Customer lifecycle and loyalty program role
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The customer lifecycle or customer journey lets you identify and segment customers based on their position with your brand over time. When you can categorize customers, you can better understand how to assign your resources and how to create relevant messaging for your customers. It is also useful information for designing a successful loyalty strategy as it allows you to:
- Ensure you are delivering the right offer to the right customer at the right time
- Model the communication of your loyalty programs to any customer
- Synchronize your loyalty programs with your other marketing efforts
As there are few methodologies to use in this area, we decided to use a model with four main stages:
- Awareness
- Engagement
- Conversion
- Loyalty
| Lifecycle Stage | Description | Goal | Loyalty Program Role |
| Awareness | A person discovers a brand through Social Media, advertisements, or a friend’s recommendation. | Acquire new leads | When customers refer a friend and the invitee makes a transaction, give both (the existing and new) loyalty points. Offer welcome points for enrolling in the program and even more for just sharing data. |
| Engagement | Lead subscribes to a newsletter, signs up for a free trial, or follows the brand on Social Media | Turn leads into prospects/users of your products | Offer bonus points for the first transaction and for using your app. Ask for more details in the customer’s profile to prepare better offers. |
| Conversion | The customer makes the first purchase. Your product is worth its price. | Nurture prospects into customers | A program offers points for each transaction and bonus points for special events like 3 purchases in a month. Even if a customer is inactive, there is an opportunity to communicate with him. |
| Loyalty | The customer signs up for a loyalty program and becomes a repeat customer. | Turn customers into brand advocates | Gathered points allow for a benefit like a reward or a freebee. When customers refer a friend and the invitee makes a transaction, give them a bonus. They can invite new members to their family account and gather points together. |
As you can see, you can align your loyalty programs with each stage to maximize the customer experience. Whether an unknown person just landed on your website or you have a well-known customer with 5 years of transaction history, a loyalty program can be designed to drive actions that help your business grow.
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