Interestingly, the customer lifecycle is similar across all SaaS businesses – from low-touch web apps to highly-customizable enterprise software. Customer success managers (CSMs) must understand the lifecycle in terms of their organization because they play a role in most parts.

The lifecycle can be divided into three pieces, each with three stages. Let’s dive in.

Acquisition

​During this stage, customers are looking for a solution to a problem. They may not be acutely aware of their problem, but they know something isn’t right. They’re searching Google, reading SaaS blog posts, following links off Twitter, and asking questions within their network.

Education is a critical tool here. SaaS organizations should produce content that addresses their audience’s common questions and problems. This is not the time to sell. Any sales pitch will be perceived as a barrier between the prospect and his/her solution. Recognize that people in this phase are researching, not buying.

1. Awareness

This is the very beginning of the customer lifecycle. The prospect is just beginning to realize they have a problem that needs solving. The problem may have just become apparent, or it might be a problem they were previously solving with a homegrown solution.

How customer success plays a role: Customer success managers (CSMs) are in a unique position to learn about the problems and experiences from existing customers. This information should be distributed throughout the rest of the organization. CSMs should be working with marketing and sales to tune lead acquisition strategy and messaging.

2. Consideration

Here, the prospect has accepted that they have a problem and must procure a solution. They also know the bounds of their problem, meaning they have a general idea of how it should be solved. (Example: “I have many people interacting with my company’s computer systems in different ways, so I need some type of access management tool.”)

How customer success plays a role: Again, CSMs should contribute to marketing’s content generation to create proper messaging.

3. Qualification

In this stage, the potential customer is qualifying potential solution providers. They will watch product videos, request demonstrations, start free trials, or read documentation. How the prospect qualifies a solution provider depends on the nature of their problem and the potential solutions. Prospects of low-touch SaaS products might Google for reviews, while prospects of high-touch enterprise products might have in-person meetings with salespeople.

How customer success plays a role: Through interactions with existing customers, you’ll learn why customers choose your product. Provide sales with this data so they can educate customers.

Engagement

​Engagement is the section of the customer lifecycle where prospects turn into customers. They make their decision, purchase, and take the first steps to realizing the product’s value.

Often, a successful transition hinges on the prospect’s first encounter with the product. According to Intercom, 40-60% of SaaS users never return after using the product a single time.

4. Evaluation

This stage is an extension of the Qualification stage, but far more specific. The customer is asking detailed questions, often directly to your sales or support staff. (It’s useful to have a live chat feature on your website to address these concerns.) Their questions are usually formed in terms of their own problem, business, or process. They might ask something like “Does your product integrate with this other tool that I use?”

How customer success plays a role: You should be identifying conversion-killers and working with sales, marketing, product development or any other team to eliminate them. Do customers need help integrating? Do they expect certain documentation? Solve these problems proactively.

David Lieberman, VP of customer success at Demandbase, found that introducing CS earlier in the process made prospects feel more comfortable. “During the negotiations phase, a Customer Success Manager is introduced to the opportunity and assigned to the account. Within 48 hours, the Customer Success Manager meets with the new business representative and the sales engineer to ensure that all the knowledge is properly shared. Sometimes, the Customer Success Manager is introduced to the client at this point, and we’ve found that clients like knowing there’s a dedicated team geared around driving value.”

5. Purchase

The big moment! This is when the customer pulls the trigger and gives you their payment details.

How customer success plays a role: Congratulate marketing and sales on a job well done. There’s not much else to do here.

6. Activation

At this point, your customers are ready to start using your product. They work through the technical setup and then dive into the product’s features. This is where they work through your onboarding process.

How customer success plays a role: The onboarding process is the customer’s journey to first value with the product. As a customer success professional, you specialize in helping the customer realize value, so your team will likely design and orchestrate the post-sale engagement and activation/onboarding process.

Retention

These final stages of the customer lifecycle are the meat of customer success’ role. Here you’ll continue to provide support and value. You’ll spend a lot of time taking steps to minimize churn and increase your monthly recurring revenue.

This portion of the customer lifecycle is where many SaaS organizations fail to invest properly. They put all of their dollars and time into lead generation and customer acquisition, but forget to retain and grow their existing customers. As a customer success professional or manager, most of your work will deal with these stages. It’s smart to using a scoring system to gauge your customer’s health.

7. Expansion

At this point, your customers are using your product regularly and comfortably. You have shown them the value of your service and they are growing. Now it’s time to expand their service level and transition them to a higher priced plan.

How customer success plays a role: In many organizations, customer success is directly responsible for expansions. At the very least, you are responsible for feeding sales information about customers who are ripe for higher priced plans. This information usually comes from the results of your quarterly business reviews and direct interactions with customers.

8. Renewal

As a subscription service, service periods will come to an end, so you have to be ready for renewals. Not renewing is easier than canceling for customers, so you need a strategy in place to make renewals smooth and expected if you want to keep your income predictable.

How customer success plays a role: Customer success plays a role in securing renewals in almost all SaaS companies. Even where customer success’ role is less metric-driven (in some organizations, CS might be tasked with ensuring a positive user experience, which isn’t simple to measure), it’s still recognized that customer value is the surest way to get renewals.

9. Referral

At this final stage, your customer is so pleased with the product and your service that they recommend you to their friends and colleagues. This is the holy grail of SaaS growth because these leads are far easier to close, effectively stretching your marketing dollars.

How customer success plays a role: While some customers will refer your service on their own, most need prompting. Customer success typically interacts with the customer more than any other department, so it would be your job to solicit referrals and pass those recommendations to sales.

Mapping the customer lifecycle

Understanding the customer lifecycle isn’t sufficient. You need to create a roadmap that plots the entire journey and describes how customers engage with your service at each stage. If you offer a solution to the customer at the wrong time, it’s not actually a solution.

For instance, a customer in the acquisition stage does not want to read an article that compares your service to your top competitor because they haven’t gotten that far yet. A customer in the expansion stage might want to read a comparison article, but only if the content compares your service levels.

Furthermore, a roadmap will prevent tunnel vision. It’s not unusual for customer success teams to get caught up in whichever stage directly relates to the program's purpose. If the team’s success is determined by renewals, they focus on renewals, even though the surest way to secure renewals is to help sales sell to the best fitting customers.

Use your roadmap to identify customer success activities that would strengthen the customer experience in each stage, along with metrics to measure those activities. For example, in the activation stage, you would create a robust, straight-to-value onboarding process and determine its effectiveness by measuring the length of time between signup and moment of first value. You can also use the map to identify weak points within the lifecycle that need support.

One last point: Your map shouldn’t be static. “Your customer journey maps and lifecycles will evolve as your company and customers grow and evolve,” says marketing strategist Katy Katz at Inturact. “They should be living, breathing documents that you revisit on a regular basis.”

The point of mapping the customer lifecycle is to get ahead of problems so you don’t spend your days putting out fires. By understanding where the customer is coming from and where they’re going next, you can give yourself a high level view and eliminate a lot of stress from your life.