Predictive Segments: Customer Lifecycle Status

Customer lifecycle indeed comes from the traditional practice of CRM, in which a customer journey is mapped from the beginning (the acquisition of a new customer) until the end (customer churn), in a cyclical manner. Targeted with the correct messages and offers at each stage, visitors can turn into potential buyers, potential buyers into first-time buyers, and eventually loyal customers.

Customer Lifecycle Status (CLS) formulates different strategies for each stage and enables marketers to build one-on-one relationships with all users throughout their lifecycles to activate non-buyers and increase loyalty. In the end, lifetime value can be increased. It provides the lifecycle status of each user based on their own journey with a personalized marketing approach backed by machine learning.

Users are grouped as visitors and customers that are respectively those who have not made any purchase yet and those who have made at least one purchase. Data span of CLS is for one year and it is calculated based on the users data collected for the last one year.

Visitors

Visitors has the following user groups:

• Visitors: These users are new visitors or those whose visit frequency is above the average.
• Potential Buyers: These users are visitors who exhibit behaviors similar to those of buyers in terms of visit frequency and visit duration.
• Silent Visitors: This group consists of users who have lost their interest in visiting the website. Their visit frequency is below the average.

These users can transit from one stage into another as follows:

• If any visitor spends more time on the website or visits it more frequently, this visitor might be a potential buyer.
• If any potential buyer does not visit the website as frequently as before or spends less time on the website, this potential buyer might go back to the visitor stage.
• If any visitor does not visit the website as frequently as before, this visitor becomes a silent visitor.
• If any silent visitor starts to visit the website again, this silent visitor might be a visitor or potential buyer depending on the number of visits and time spent on site.

Customers

Customers has the following user groups:

• Active Customer: These users are regular buyers with predictable behaviors (e.g. they make a purchase once in 1-2 months). If there is any purchase pattern, CLS takes this pattern into account.
• Inactive Customer: These users are formerly active customers whose behaviors have changed (e.g. they make purchases less frequently now). These customers might be considered as customers at risk.
• Churn Customer: These users are formerly active customers who have stopped making purchases and are unlikely to return.

These customers can transit from one stage into another as follows:

• If an active customer does not make any purchase for a while, this customer might become an inactive customer depending on the purchase pattern of visit frequency.
• If an inactive customer keeps not making any purchase or not visiting the web site, this customer might become a churn customer depending on the visit frequency.
• If a churn customer is interested only in visiting the website yet does not make any purchase, this customer might go back to their inactive status.
• If an inactive/churn customer makes a purchase, this customer might become an active customer.

Use Cases

Before starting to use any Customer Lifecycle Status, we strongly suggest you take a look at the best practices!

• Keep active customers engaged, loyal and as purchasers via post-purchase or replenishment campaigns.
• Nurture inactive or churn customers back into active customers through reactivation campaigns.
• Give potential buyers incentives to nudge them to make their first purchase.
• Bring silent visitors back to the website by offering new content to them.