The 5 Stages Of The Customer Lifecycle

February 12, 2020

Marley Wagner

Category: Customer Adoption, Customer Experience, Customer Onboarding, Customer Retention, Customer Success as a Service, Customer Success Strategy

When your customers decide to begin a relationship with your business, you are both embarking on a path in which you are responsible for delivering on the promises that your marketing and sales teams made. Guiding your customers at the right pace, with the right understanding of their business, and providing the right tools are the keys to a successful and positive customer experience.

Being receptive and vigilant about how you guide your customers requires planning and structure. And, knowing what the key components are: How do you convert strangers into customers, from customers to repeat customers, and from repeat customers to advocates who will help you gain even more customers? How do you effectively drive that process?

We’ll be the first to admit that there are varying opinions on how to visualize the customer lifecycle, though always with the hope of seeing the experience from the customer’s point of view. How do you manage your customers when they’re new and uncertain? What about those many months after they’re onboarded when they’re on their own? How do you know if they’re ready to grow, or want to leave?

Here’s our view of the customer lifecycle – we’ll humbly say it’s a pretty good place to start if you’re looking to create this critical framework.


You gotta get this right, but it’s tricky. This is the point at which your customers are getting a first impression of your company and of your service. It’s also where you have momentum coming from sales, and you don’t want to lose that excitement and interest.

The onboarding stage is the stage at which you welcome new users to your ranks, showing them that you appreciate their willingness to take a chance on you. Depending on the exact type of product or service you offer, this is also the time to help them get set up. That could mean installing the software, importing data, and configuring software to meet their specific needs.

You’ll likely have a checklist of the activities customers need to complete to be considered fully onboarded. Sometimes this is as easy as creating a log-in and getting access, and sometimes it’s a months long implementation with data integrations and project plans and lots of stakeholders.

Whether you’re doing the onboarding yourself, with a specialized team, or providing the customer with the materials they need to do it themselves, you’ll want to track how long it takes. Time to onboard is an important KPI to keep an eye on and reduce as much as possible — time spent onboarding is time that the customer isn’t actually using your product yet.


Let us start by stating that education and training is needed throughout the entire customer lifecycle, but we find it to be especially critical just after onboarding, when customers are on their own to use your product for the first time. And although your onboarding checklist may say you’ve already taught them how to use the key features, there’s a good chance that they missed some (or all) of that through the intensity of implementation.

Education can come in many different forms, and one size does not fit all. Training modalities can vary, based on the complexity of your product, as well as the learning styles of your customers. It could take the form of a how-to manual, online resource center, short videos accessible from the product itself, onDemand videos, or full-fledged instructor-led training.

Whatever form it takes, make it accessible to your customers and make sure it stays updated with changes the product team is making. Engagement rates are twice as high for trained customers as their counterparts that go it alone, so the investment here will be well worth it.


By the time customers reach the adoption phase, the onboarding work is done, the product is up and running, and new users have at least a basic understanding of how to utilize your product to help them achieve their goals. Now those users will begin incorporating it into their everyday workflows and start to get a sense of how much value you’re providing.

Hopefully you’re saving them time, hassle, and money. They’re putting their training into practice, learning the ins and outs of the product, what features they like best, and what your company represents. Of course, some of these aspects of the product and the company were in your marketing materials — that’s what drew them to you in the first place. But this is the point where they’re starting to see for themselves just how useful those features can be.

Remember, the educational part of your job isn’t over. If the customer can’t figure out how to use your product, or they don’t fully grasp just how many useful features there are, they’ll move on to other options. Quick tutorials, videos, and other educational resources will make the path to adoption easier. Your adoption rates should start to increase and your customer engagement score — a number that encompasses how much value your customer is getting out of your product — should be climbing.

This is also where you want to start monitoring usage to make quick adjustments as your client is getting their bearings. How much and in what ways are they using? Are they opening a lot of support tickets? Are your CSMs getting a lot of questions? Do they need more training? This is an active time to ensure your customers are ready to fly.


The value realization phase is when your product goes above and beyond the expectations of your end user to net them a positive ROI. Remember, there’s a reason the customer signed up for your product or service in the first place — there was a need that had to be addressed, a process they wanted to streamline, or a cost they wanted to reduce.

When a customer enters the value realization phase, it means they’ve incorporated it into their day-to-day workflow, using a wide breadth of features that meets or exceeds their expectation of what your product would do to help them. You’ve achieved the business case they were hoping for and shown them that their investment in you was worth the money.

This is the point where the customer is most receptive to cross-sells and upsells. They’re convinced that what you do is worth the money they spent on it, so your other products must be too! Your install-base marketing efforts should leverage that newfound confidence.


Value expansion is the endgame of the whole process — not only has your customer made the decision to purchase from you, but they’re so happy with your product that they’re buying more and telling friends and colleagues to join them in making the switch.

Tap into the enthusiasm of your best customers by soliciting reviews, testimonials, case studies, and even incentivizing referral programs. Recent market research has shown that the power of word-of-mouth marketing only continues to grow — potential new customers value the word of existing customers far more than your own marketing efforts. If you keep them happy and successful, your existing customers will become your best source of new customers, and the cycle will begin again.


We left renewals off this list for a reason: Renewals are an outcome of strong customer lifecycle management. Renewals aren’t a cause of good Customer Success — they’re the result. If renewals are low, it’s because something happened in the lifecycle that led to risk, (onboarding did not go well, the product was not fully adopted, they didn’t use all the features that were of value to their business, they didn’t see ROI, they didn’t care enough about it to tell their friends, etc.).

If, on the other hand, you dedicate your time and attention to making sure that customers are onboarded effectively, adopting the product, seeing its value, and becoming advocates to their peers, renewal will take care of itself, or at least with much less effort from your team.