Customer Lifecycle Marketing: Journey of a Happy Customer (Part II)
(This is the second article in a three-part series on Customer Lifecycle Marketing and will focus only on the customer journey of happy customers. The first article (linked at the end) focuses on the basics of customer lifecycle marketing.)
Think of a brand or product, or app that makes you happy.
So happy that you would gladly use it again and again and also recommend it to others?
Can you think why that brand/product/app makes you happy?
Was it the product itself or the surrounding experiences, or both? Now turn it around, consider your customer base and assess whether you can deliver along similar lines.
Making a customer happy is challenging, but we’re here to help you identify and engage better with those on the happy path to becoming your loyal customers and advocates of your brand.
So let’s dive right in.
The 7 Stages of the Happy Path in Customer Lifecycle
In this, the second article of the series, we will walk you through the journey path of a happy customer. It marks the stages in a customer’s life, from discovering a new product/app to becoming a repeat customer until they qualify as loyal customers and eventually advocates for your brand.
There are 7 life stages in a happy customer’s journey:
This is when the customer discovers a product or service that fulfils a certain need of theirs. For instance, trying a new food delivery app when the customer is hungry or a ride-hailing app when traveling from A to B, or booking a hotel via an online travel booking service while planning a vacation.
The customer may have discovered the product/app/platform through various sources such as:
Ads on traditional, digital, and social media
Through organic mentions or reviews by other users on social media apps, blog posts, vlogs, etc.
Word-of-mouth publicity through friends, family, colleagues, and acquaintances
Here, target potential customers and draw them to the product using relevant content about the product and emphasizing the value it offers. Keep the communication simple. Avoid details about advanced features. That can come later.
“During discovery (stage) focus on making an impression on your customers to drive them towards your destination (your product website or app) where they can know more about your product,” says Sagar Patil, a growth consultant, who has worked with retention marketing, CRM and product teams at brands like Flipkart and Jumia (UAE). He is also the Course Director for CELP – Customer Engagement Leadership Program – the flagship customer engagement course of hashgrowth.org.
2. Onboarding: Getting That First Impression Right
Onboarding is all about making that big first impression. Here, your customer gets to experience your product and the value offered by it for the first time. This experience can be a deal-maker (retention, long-term relationship) or deal-breaker (never try to use the product again), depending on the onboarding flow designed.
At this stage, help the customer become familiar with the product by giving details about the functioning of the product, its usage, and its many benefits. Overwhelming customers with a lot of product-related information such as add-on features can be confusing and off-putting. Identify the most viewed or used features and display details about them during the onboarding process.
A good onboarding flow should convince the customer to commit themselves to the product or app.
What does this commitment look like? Well, that is unique to each product.
It can be in the form of a good registration flow or experience for freemium products, where you allow the customer restricted access to a few features of your product which then convinces them to purchase a subscription. Apps that fall into this category include music or video streaming platforms (SoundCloud, Gaana, Spotify, Netflix, Prime Video), online news outlets (Indian Express, Business Standard, The Economist, The Caravan Magazine) audiobook platforms (Audible), etc.
These apps get the customer hooked on to the platform by showcasing some of their best features during the onboarding stage as well as the ease and convenience of use so that the customer then commits to buying a long-term subscription.
An example of an uncomplicated, hassle-free onboarding process is the SoundCloud onboarding process. On downloading the app, at first glance you know the value proposition it offers – helping you discover new music. From there, the app has a seamless, pleasing-to-the-eye interface asking you to sign up with mail which opens the disclaimer tab.
The app does request too much information except your age and gender so that it can personalize content and music recommendations. After that, choose a display name and picture, and you are ready to explore the app!
In case of India-based music apps such as Gaana, customers are also asked to choose their preferred language or languages to customize music recommendations further.
It is critical to strike the right balance between a good customer experience and the utility of the information requested here. Ask enough questions, so you are able to create a basic profile of the customer, their likes, dislikes, and preferences while making sure it doesn’t seem too intrusive.
In the above SoundCloud example, asking for gender and age along with language preferences is fine but asking them to part with personal information like address and bank account details is unnecessary.
Another form of onboarding is where you get customers ready to start experiencing your product by helping them set up their wallet, complete their KYC registration or simply walk them through the various features of the app. Examples include crypto apps (CoinDCX, WazirX), financial services apps (Scripbox), fitness apps (Cult.fit, Fitbit), etc. These apps require you to register, and also pay for their services before the customer can derive value from them.
For instance, crypto apps like CoinDCX Pro requires the customer to complete the KYC verification process before they can even let you add money to the e-wallet. KYC process includes taking a selfie and providing both an address and identity proof document scans. The KYC takes some time to be approved.
Once the approval has been received, you can then add the CoinDCX bank account as a ‘beneficiary’ to your online banking account to transfer money to the e-wallet. After this, you can start trading. The app is well supported by an offline team that immediately gets in touch with the customer to help them set up their wallet and help them start trading.
Financial platforms that require personal information are always viewed with a little suspicion, and any hiccups there can put off a customer from even setting up an account with the app. Any pain points during the onboarding processes can seriously harm the prospects and the credibility of such platforms.
3. Activation: Value Derived
Activation is the point at which the customer derives value from the product for the first time.
This stage is when the customer makes that very important first purchase. For instance, a ride-hailing company or online travel booking company would consider booking that first cab or hotel room as activation while for OTT platforms and media companies it would be buying a subscription. For audiobook/music/video streaming platforms it could be downloading that first book or song or watching that first movie post subscription as that is when the customer derives value from the product.
The activation stage is very critical because this first experience of the customer can dictate whether or not they will want to repeat their purchase in the future.
Imagine if the product is delivered on time or before it, wrapped in a beautiful environmental-friendly package with a personalized message and a short story about the product’s origins. Wouldn’t that be a wonderful first experience that the customer is unlikely to forget anytime soon?
A seamless onboarding experience followed by a successful activation process should be seen as the foundation of a long-term relationship between the customer and the product or brand.
As an example, let’s look at Fitbit, the health and fitness tracker app.
Fitbit follows a freemium model approach. During the onboarding stage, the app provides with a few free features such as access to short exercise videos.
But on activating the ‘Premium’ membership, the app opens up an entire suite of workout videos, meditation practice videos, meal logs, water-intake logs, and healthy recipes to try and even helps create a ‘Wellness Report’ that tracks health trends over a 30-day period. This report, the app claims, is credible and reliable enough for you to have a conversation with your doctor about it.
The app acts as a one-stop shop for all things health. Tangible measures such as steps taken, heart rate, calories consumed, water intake, etc all give the customer a real-time understanding of their habits. It helps them make healthier decisions. This is a big draw for customers – the reliability and ease of access to such information.
Moreover, the app interface and the content are smooth and easy to follow. The app offers challenges and adventures which adds a competitive element to the overall experience.
Given the price point at which it is retailed, a customer might gladly pay for the premium service as it is priced much below the price of the Fitbit tracker devices.
4. Repetition: Guilt Your Way into Customer Wallets
If your customer reaches this stage where they want to repeat their purchase, then you can pat yourself on the back because it is reported that nearly 80% of customers do not go beyond the activation stage.
Don’t get too carried away though because there is still a long way to go.
That the customer has remembered and recalled your product means that their onboarding and activation experience has been unique and stands out in their memory.
A memorable experience is what makes customers come back to the product/app/platform. Any change during this stage in product delivery or product performance can create a dent in the customer experience.
Consistency of product performance and personalized, engaging, and timely communication with the customer to keep the product fresh in their minds are key to the success of this stage.
For instance, one of the apps that does customer engagement best is Duolingo. Right from onboarding to loyalty and then advocacy, Duolingo plays its cards right creating happy customers everywhere. But we want to particularly highlight the push notifications that it sends to customers to get them to repeat their lessons consistently.
In a bold and risky move, the app even uses what CEO Cem Kansu calls “passive aggressive reminder”. Here’s a series of tweets posted by the CEO explaining the motive behind such a notification.
The “passive-aggressive reminder” was one of the most successful push notifications, explains Kansu in the above tweets from 2020.
The notification, sent after a week of inactivity, simply offered to put an end to all further notifications, given that the customer had been inconsistent with their daily lesson. Such a notification within a week might seem outrageous. But on the contrary, the FOMO created by this notification encouraged customers to get right back to their lessons. As Kansu explains, the notification worked because it was personal, unique, and well-timed.
Personal because it seems like a direct text from the brand mascot, Duo. The direct matter-of-fact tone of the message heightens the feeling of shame and guilt at having missed the lessons.
Unique because no brand would dream of talking about not sending notifications.
Well-timed because a week is neither too early nor too late for a reminder as lessons learned might still be fresh in the customers’ minds.
These notifications are part of an extremely personalized experience on the app. The fact that customers have come thus far to the point of repeating their behavior proves that point. Getting repeat customers is largely a function of good communication and instilling a sense of FOMO.
Make your customers believe that they are about to miss out on something good if they discontinue their association with the brand. And of course, adding a bit of guilt never hurt anybody.
5. Habituation: Make Your Brand Second Nature
This is when using the product turns into a habit for the customer so that they organically remember the brand whenever the need arises.
At this stage, the customer could even overlook slight changes in prices, delivery time, and even in basic product design as long as it delivers the value and quality it promised.
For instance, everyone has their favorite food/grocery delivery app. Post-Covid, there was a noticeable increase in delivery prices, but that did not deter customers from using their favorite apps.
The trust between the customer and the product is well-established at this point. Communicating regularly with these customers and also offering them discounts for their regular usage or granting them early bird access to new products and features can go a long way in keeping the trust intact.
The key to repeating customers to the point of habituation is to earn customer trust by delivering an undeniably superlative experience repeatedly with high levels of customer satisfaction.
Often, the most common method employed by brands to ensure repeat customers is via discounts. But remember, this could be counter-productive for your business and set wrong expectations with customers. At some point, the discounts will have to stop, and then you may end up losing some serious business.
While discounts may do their job to some extent, the right approach involves constant communication with your customers. A month or a few months after their first purchase, you could remind customers to renew or place a repeat order.
Say the first purchase was during an event, a season, or a festive occasion, then on the anniversary of that event or when a festival next comes up, you could shoot an email, WhatsApp, or SMS campaign or send push notifications reminding customers to repeat their purchase experience by buying your product again.
One of the best apps that does repetition well is Myntra. The app continues to engage with customers even after the first purchase is made. The brand engages with customers through push notifications, email campaigns, and in-app messages sent out during specific occasions.
While discounts continue to be offered on certain brands, Myntra’s strength lies in communicating with the customers constantly through personalized content that ensures repeat customers. The clever use of testimonies by influencers adds significant credibility to the brand and app.
Here, customers are happy to repeat their purchases with Myntra because they feel seen and welcomed into an intimate community of shoppers. Sending personalized emails with pictures of the latest in fashion piques their interest, drawing them naturally to the app. Further, the use of influencers through in-app videos makes for a more relatable and credible shopping experience.
Let’s look at Duolingo again. The app cleverly uses its various in-app personalities (Lily and Junior, here) to send witty messages aimed at encouraging customers to complete their daily lessons.
6. Loyalty: Exclusivity
This is the stage when the customer has become faithful to the product. Every business wishes the customer reaches this stage as it signifies the establishment of a long-term relationship with the customer and more importantly, an increase in the revenue generated by the customer.
A loyal customer doesn’t just buy more of your product but is also willing to pay a premium for it, buy an upgraded version and also buy other products or add-on features via cross-selling and up-selling. This leads to an increase in their lifetime (LTV) as well as their wallet share.
For instance, a loyal customer of an OTT platform is unlikely to drop the subscription after a rise in subscription rates, considering the quality of content available on the platform.
The loyal customer, having invested their time and money in your product, sees value in continuing their relationship with your brand.
At this stage, the customer needs to be rewarded for the time and money they have invested in the product. This can be done by offering further discounts, especially on referrals to others. Another way is to personalize content for such customers by providing them exclusive demos of upcoming features or expert articles on advanced versions of the product.
The Starbucks loyalty program – My Starbucks RewardsTM – features on most top app loyalty programs lists. Purchase and payment are both made easier through the Starbucks app in the following ways:
- Every purchase made through the app gets converted to rewards which can later be redeemed. That is frankly not new, nor restricted to Starbucks alone. But here is the kicker which truly sets Starbucks apart – you can convert the app reward points to pay at a physical store. This means if you have enough reward points to buy yourself a coffee on your app, then you can simply scan the barcode to pay using those points at any Starbucks outlet. This seamless online-to-offline experience is a winning strategy that keeps customers loyal to the brand.
- The app helps you locate the nearest Starbucks store which reduces the time spent looking for one. This is yet another wonderful feature whether you are on a road trip across the country or on your way to work. This feature makes customers believe that they are never too far away from a Starbucks store. It also keeps customers from going to a competitor brand to buy their coffee or eat food.
- You can place your order through the app and pick up the order at a Starbucks outlet closest to you. This means no more standing in line at the counter. This added to the convenience of paying using app reward points helps customers save time and provides a seamless purchase and payment experience.
- There are three levels in the program with each program offering a free drink on any day of your birth month and other benefits such as free customization, size upgrade, and more free drinks, depending on the level you have unlocked. Customers love free things, and Starbucks taps directly into this psyche which results in higher LTV and a life-long bond with the Starbucks brand.
7. Advocacy: Rewarding Customers for Loyalty
“Advocacy is to get more customers from your loyal customer,” emphasizes Sagar.
This is the highest level of customer engagement and is basically word-of-mouth publicity. It’s an indication that you have successfully created a long-term relationship with the customer and also found in them your brand ambassadors.
When a customer reaches this stage, they start to advocate the brand to everyone they know – friends, family, colleagues, casual acquaintances, etc. Even today, family and friends are considered to be the most trusted course of information on products and services which increases the likelihood of a product being tried by new customers.
It comes naturally to them to talk about your product or brand and recommend it to others knowing well that they will not be disappointed.
Such is the faith they have in your brand that they are willing to put their own reputation on the line by encouraging others to use it. This is also the highest compliment a brand can receive from its customers.
Furthermore, they are likely to post flattering, flowery reviews about your product on social media and not miss out on opportunities to talk about your product.
This is the best publicity any brand can hope for because it is organic and brings in new customers at zero acquisition cost.
One of the most successful viral customer referral programs was run by Uber when it was trying to find a foothold in the Indian market. The program enabled an existing customer to send one free ride to a friend of theirs. Once the friend completes their first ride, a free ride would be credited to the customer who referred Uber to them. There was no cap on the number of free rides a customer could get. The more the customer referred Uber to their contacts and friends, the higher the number of free rides they got.
This experience was enhanced by the availability of premium sedan cars as cabs and customers couldnt get enough. It is safe to say that this program helped Uber successfully and undeniably establish itself in the Indian market. However, the program was later rescinded once Uber had made itself a household name in India.
Another form of referral that works well with customers is the one that promises a cash component. ‘Refer and Earn’ is a common catchphrase for most payment apps. The lure of getting cash in lieu of a referral is a strong motivation. Customers would gladly recommend and refer an app to friends, family, and acquaintances and ensure that a transaction is completed by the new customer to be able to avail of the cashback offer.
The next and last article in this series will take an in-depth look at what makes a customer unhappy. We will look at the different stages the customer goes through on the Unhappy Path to being churned away and the Return Path to bring them back onboard as happy customers.
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