SiriusDecisions Highlights Customer Lifecycle Framework For Retention, Loyalty Optimization

May 29, 2012
Published in Data Management

While sales and marketing teams focus largely on mapping out initiatives based on the buyer’s journey, many still have not addressed an untapped opportunity to measure and optimize the customer experience.

During the SiriusDecisions Summit last week in Scottsdale, Ariz., Group Director of Data-Driven Marketing, Megan Heuer, highlighted the research firm’s Customer Lifecycle Framework and underscored the framework's four phases from two points of view: the company and the customer.

B2B professionals closely monitor the buyer’s journey, but when the buy cycle ends, Heuer emphasized, the responsibility of sales and marketing is not over.

“The job of sales is pretty clear in a lot of companies,” she noted. “With marketing, not so much, so this is a really great alignment [opportunity]. The trick is to know what to do and when.”

Heuer pointed to the B2B Customer Lifecycle model, which defines stages that customers go through, as well as the supporting roles and responsibilities of sales and marketing. The model speaks to two perspectives — the company’s (the responsibility and initiatives within the customer lifecycle) — and the customer’s (to understand the experience, needs and brand perception).

“It’s important to pay attention, not just to what we are trying to say to our prospects and customers, but what our buyers need to [make their purchase],” Heuer said. “This is about how our customers will realize value from working with us.”

Heuer highlighted the following four stages of the customer lifecycle:

Deliver - This is the second chance to make a first impression. “After someone buys, you need to reassure them that they’ve made a good choice, and prove there will be value in the relationship,” Heuer said. These tactics include onboarding program offers, account plans to define relationship goals and thank you notes. “Make sure you’ve rolled out the welcome mat and the customer has walked through the door.”
Develop - Similar to a plant, customer relationships need nourishment to grow. “From a sales and marketing perspective, if you drop the ball after that welcome phase — even if you’ve made a good second impression — if you blow it in this phase, the formula for calculating customer lifetime value won’t hold up,” Heuer said. “This stage can go on for years in some relationships, so you need to develop what it means to be a customer by helping them understand what they can get out of it.” Examples include: marketing communication plans highlighting new developments, information and community-focused announcements.
Retain - This is a critical stage during which customers actualize and define the value of the relationship with the companies they’re doing business with. Heuer advised enlisting a quantitative model at a later stage in the customer relationship to compute the value a company brings to a customer. “The better job you do at the beginning to set up value expectations, the better you’re able to describe it and review it in a quantitative way to measure the value you’ve brought to the customer,” she said. “You may not get here to this phase and you might fail if you don’t understand the value of the first two steps. But if you’ve done a great job, then you’re going to have a lot easier time and can progress to stage four.”
Growth - “It’s not just about holding onto business,” Heuer added. “It’s about making the business become a partnership with you.” By ensuring a sound partnership, progressive B2B organizations develop advocacy strategies that encourage customer satisfaction and positive word of mouth. “That’s worth money,” Heuer said. “Sales and marketing can architect modeling to predict the next steps to purchase and build a reference team empowered to reach out to clients, identified as happy, to engage them with other clients.”

“When you put all of this together you have a map of the journey that your buyer goes through after they buy,” Heuer said. “It’s a continuation of that cycle. When the buying cycle ends, the rest of the lifecycle kicks into high gear. This is how you make it a race you can win!”