Podcast Episode #17: KAM Customer Life Cycle

Hi and welcome to the Key Customer Growth Podcast. My name is Jermaine Edwards and I have become obsessed with customer behavior and how people and organizations win with their best customers long term. After starting, failing, and growing my own companies, 30 customer growth projects, hundreds of strategies, and the study of 50 years of customer service research, I've seen firsthand how and why organizations win, lose, and win again with their most important customers. This podcast is my way of sharing those insights, failures, principles, and strategies so you can become what I call an irreplaceable advisor, someone so valuable your customers never want to leave. In an increasingly competitive world, how do you continue to deliver unrivaled value and deepen those most important customer relationships? Join me as your customer growth guide. Your journey starts here. Hey, it's Jermaine Edwards, your customer growth guide, and you're listening to the Key Customer Growth Podcast.

And this is episode number 17, and we're going to talk about something that I haven't heard spoken about in the key account context, I'd say ever. And it's usually spoken about in marketing, perhaps sometimes from a sales context, but never really identified steps that are helpful for somebody managing a portfolio of top customers or a key customer themselves. And this thing is the customer lifecycle, in this case the key account lifecycle, and how to think about that. So a big question here is, um, how do we know what stages our customer relationships are actually at? How do we identify that? How do we think about those things? Now there are two distinctions that we can make, and The first is the individual relationships and how those work, and actually got some really great work on thinking through what we call social relationship theory and the Kanaps model of thinking through how we level up our relationships and ensure that they are sustainable and influential and ensure that they are not in a downturn, and if they are, what to do about it. So I'll come back to that in a second, but the other part is actually looking at the actual organizational relationship and how we manage that in the context of the operations of our business. How do we think about the different stages that influence the and impact the quality of work that we have and do with our customers and what they experience? So it's a really important question when we ask you, how do we know and what do we do at these different stages in our customer relationships? So Here's what we're going to do. We're going to look at just a few kind of aspects here around the customer lifecycle. What is it actually? What have we found? What does this look like? And then walk through the 8 specific stages of a customer lifecycle management that will be helpful for us to consider and really get to grips with. So let's get started with this. So within the frame of a customer customer lifecycle. That term is still quite a new term, but it was popularized in the field of marketing and spawned really through a new movement that was inspired by the customer service or customer experience industry. There are hundreds of thousands of customers, perhaps more, that use this whole idea of the customer lifecycle, and there are specific stages that have been noted and documented well by companies like HubSpot and McKinsey and, If you look at some of the research done around some of the most successful companies on the planet today, like Apple, you'll see that they have these customer lifecycle plans in place. So the whole idea is that those that have these things in place, this customer lifecycle, have, you know, can experience a lot of really significant benefits when they evaluate it well. Increase in customer profitability, strengthen their brand position, retention of key customers, your product innovation and new market access. They can really begin to tap into a new world of opportunity. However, today the customer lifecycle is defined as the steps a customer goes through when they are considering buying, using, and remaining loyal to a particular product or service. Now, this is a really great place to begin thinking about what the customer lifecycle is supposed to show us and how it might help us with our customers. But it's not where it ends, because it's especially true when it comes to the application of key account management and the elements that shape success of existing customers or existing customer management. The part of the customer lifecycle management that is most important for us to consider here is this: that successful customer lifecycle management involves the business processes an organization uses to move the customer through the customer lifecycle. So how we respond in each of the areas I'm about to share with you as an organization will contribute to the success of a customer relationship and the profitability of that relationship, else to the detriment of that relationship as well. So it can go both ways. So there are different stages in the customer lifecycle, and there are various methods that people have used to define it. I'm taking this from a particular book, a paper that I've read, and I really enjoyed, called the E-Metrics: Business Metrics for the New Economy. And this was written by two guys, one named Jim Stern and a guy named Matt Cutler. This was published right back in 2000, early 2000s. So it illustrates a really effective view of the customer lifecycle, and although it takes it from a very marketing perspective, I've given some real thought to the application, and I'm going to share with you some questions that go alongside these 8 steps that are going to be really helpful for us engaging well with our customers. So here are the 8 steps. There are awareness, knowledge, consideration, selection and assessment, buying, satisfaction, retention and loyalty, and advocacy. Now I've given you a lot of things here. I'm gonna say it one more time, then we'll go through some questions. So number 1, awareness. Number 2, knowledge. Number 3, consideration. Number 4, selection and assessment. Number 5, buying. Number 6, satisfaction. Number 7, retention and loyalty. And number 8, finally, advocacy. So how do we think about these 8 areas? So for advocacy, let's start at that place, then we'll move through awareness. So the core question here is, how are we creating customer champions? That's the core question around advocacy. So if we think about any kind of thing that we do with our business, we need to think about about what are all these activities intended for us to begin to create for and with our customers? What's the intention of it? Yes, we want them to be successful, to achieve specific goals, but for the business, what is our intention? Yes, for them to purchase products and services from us profitably and consistently, but ideally what we want them to be are customer champions, people who have a desire to stay with us long-term because of the inherent value value we bring and because of the unique advantage they get from our relationship. So ideally, we want to become, and I've said this many times, the kind of organization our customers never want to leave. So this means for us that our customers proactively and openly supporting us and is turning that relationship into a place, a platform for them sharing their own voice. So we become a platform for their voice. And our voice of the relationship becomes like that they are willing and really open to sharing with other people. So how can we begin? Well, let's give you one thing to start with in terms of just advocacy in the, in lifecycle management is look at how you're tracking engagement and satisfaction with customers across departments, not just the customer itself and a bunch of contacts that, you know, like you, and go right across the business. Every part of that customer that has interaction or is impacted by what you do needs to have some kind of evaluation to understand exactly where it is. Now, a lot of people would say NPS is a great way to think about this, and it's a good starting place. I'd look at some integrated procedures where you're looking at multi-faceted pieces of data to really ensure that you're looking at behavior accurately, not just from a statement, but from a series of behaviors that you can identify as being your lead indicators to the loyalty that you actually want from your customers. And I could talk more about that, and maybe in another episode, but that's advocacy. How are we creating customer champions? Then we have awareness, and the big question here is how do we position our value? So really important. So again, the function of our engagement with our customers is yes, for them to purchase something from us profitably and consistently, also for them to be advocates for us, but we also, in order to do that, need to position our value well. And so And we think about this idea of value. I speak a lot on this and actually very passionate about it. Without value, credibility and influence with any organization is lost over time. Without value, credibility and influence with any organization is lost over time. So we need to position it in our daily activity. We cannot take for granted that our customer knows the inherent value they get from our relationship. They are aware at all times of the impact that we have on their business. Business, it just isn't true, and they won't always have visibility. So we need to position our value. So number 1 thing we could do is simply bring the value to the customers, bring it to their attention, share their story and how you contributed to that story of success. So that's awareness. Number 3, knowledge. Let's have a look at this. And knowledge is how are we educating customers on insights from their business. Now, one thing I've come to realize that is very powerful, and it's within the value framework that we use in Customer Mastery, and it's understanding this principle. The principle is this: that we know more about our customers than they do about themselves. Why? Because we are interacting not just with multiple people, departments, but we're seeing how they purchase and we're seeing the use case, meaning the problem that we're trying to solve for them. We're seeing how they respond to that and how they interact with the tools and things that we give them to achieve those things. So because of that, we have some great insight that would enable them to either achieve a goal faster, get more value from what they're doing with us already, or maybe even create something brand new that would give them some kind of a different advantage in their marketplace. So, we have a bunch of stuff that we may have never explored with the customer that we know about them. So, question is, hey, what do you actually know about your customers today that your customer would benefit from knowing? What is that? I bet you could probably come up with 3, 5, 6, 7, different things you could bring up. With every organization I've done this with, we've come up with no less than 7 or 8, and that is significant. And just, I mean, just one, having one or two is good enough for a customer, but have 7 or 8 on average is phenomenal. So that's definitely something you should do. That's around knowledge. And so let's move on to consideration. This is number 4 here, consideration. So the whole idea of consideration is how are we connecting our customers? So two of the most powerful forms of influence is social proof and authority, and both are connected to when others talk about what you do and also when others point at the results of what you do. So this is really important. So we can have a range of different things that we use to do that— customer meetings, customer forums, customer events— but the question is here is how are you telling the story of results with your customers? How are you doing that, and how are you connecting those stories with other customers? What we want is validation that I'm still in the right place. We want to know, customers want to know, are you still relevant to me? Are people choosing you? Are what we doing really the best of what we could actually have, and is it really going to give us the future consistent results we're looking for? We're always asking these questions, whether or not it's, you know, yearly or every 2 years, we are going to ask those sets of questions, particularly where something changes in our marketplace or within our business. It tends to disrupt or interrupt our patterns of regular positive thoughts of providers, and we can very quickly think negatively about the people we're working with, who in a circumstance really comes up and disrupts our thinking or our paradigm or our comfort level. So how are you currently telling the story of your results with customers? How can you share that with other customers? Again, let's move on and we'll look at now selection and assessment. Now, selection and assessment is— the core question here is, how are we making ourselves easy to choose as a partner? And this is really interesting because I often I don't think it's a question we've often asked. We talk about, you know, how do we, you know, position our value. We talked about these particular aspects, but how do we make ourselves easy to choose? Well, there's a number of ways we could do that, but I'm just gonna give you a couple of things to consider. So we must evaluate if a customer relationship is actually right to continue investing in. That's the first thing. And if not, we need to communicate why to the customer. So I'm not saying that every single customer you have to pour all your heart, soul, and life into. Not all customers are created equal, and sometimes the key customer you begin with may not be the right place or right organization to move on with, with the same level of investment. It does happen. So we have to honestly evaluate how easy we are for our customers to do business with as well. What does that look like? Where are we heading? Where are they heading? So we need to begin to ask some much harder questions, perhaps. About where we are with a particular portfolio of customers, a particular organization, a customer, and then ask, you know, how easy are we to work with? How good is our communication? How does our customer feel about our interactions? Questions like that will get us started. Next, we have buying in the change management cycle, in the customer lifecycle management, and Buying has a core question: How quickly are customers getting results from purchase? Now, this is super important. The whole idea of value realization or purchase realization or buying impact, whatever those terms you might want to say yourself internally or what you hear internally, it doesn't really matter. What matters here is: Are your customers getting results fast? Now, fast can mean different things for different industries, particularly because of the expectations of implementation. Depends on the complexity of that. But I believe personally that regardless if your product or service is super, super complex and takes, you know, 6 months to implement, along that journey, there are quick wins that you can give a customer. It doesn't matter what it is. I've not come across a company yet, and I've worked with biomechanical sciences, engineering companies, technology companies, not come across a company yet where we haven't found the opportunity to give a customer a win within 30 days of a purchase. So, a couple of questions to consider here, or just a single one to begin with: What is your contribution to the result for the customer? What's your contribution to it? And once you've understood that, What are the things that you're doing exactly to help realize that result? So really get fairly granular here. What are the specific things that you're doing in order to get them to that result? Because what you'll see in identifying those particular steps is that there are small wins that the customer needs to see, or you're helping them see, in order to get them to that result. An example being, if you— the result for the customer is to have a specific technology built that will help them to significantly reduce costs and speed up and reduce wait times for a customer, you know, wanting to, you know, get a quote. Then we know up until that point there'll be some testing, there'll be perhaps, you know, a beta of a particular product, there'll be collaboration, there'll be design things that go in. Each of those different elements requires some kind of thought around what advantage are we creating or what, what is the actual output that we're creating for the customer here. And so if you can identify that, you'll be on your way to knowing how quickly you can actually get results for your customer after they've purchased. Okay, let's think about satisfaction as number 6, or so I should say Number 7, satisfaction. Big question here is how good are we at the post-purchase experience? So this is where customers typically— companies typically fall down. They have a plan for the first 6 months of implementation, but nothing after that. They fall down. And so we need to have a route to market with our customers, an onboarding sequence, even if they are a customer of ours. That lasts 12 months after purchase. It needs to be that long. And the reason for that is oftentimes implementation just takes longer than we expect, not necessarily because you can't do it faster, but actually adoption for an organization can often be much slower, 3, 5 times slower than we expect. So we need to be thinking about how good are we at managing that process so that the post-purchase experience is fantastic for those who are using the product or service. So ask yourself some questions for your department. What is your role in the post-purchase experience? What improvements can you make to the experience? What are the role of the different departments in your business to the post-purchase experience? How can we improve those things? What kinds of things can we improve? Why might we improve that? What impact might it have for the customer? There's so many great questions you can ask, and iteratively you can make these changes you can almost immediately, in some cases, change and transform the way a customer sees you. All right, so last but not least, retention. So the big question under here is, how are we managing loyalty? So it's not just about advocacy— are we creating customer champions?— but how are we managing loyalty in that process? So what do we mean by this? Well, ultimately, all the activity we engage in is designed to keep our most important customers. Year after year. Yes, we want them to be— to purchase things profitably from us. We want them to do it consistently, but we want them to actually stay for the length of time which we know honestly we can serve and support them in achieving specific goals, whatever that time period is. So the fully coordinated approach you take as an organization matters. To really need a fully coordinated approach as an organization to really get managing Lottie well. Because Lottie is both a function of management and magic. So the management piece here is what is happening underneath, foundationally, operationally, things out of how they working. And it's functional sort of magic. So it's the whole idea of How are we making these experiences stand out? And those go to the individual context of, of every single person playing their part. So what is your personal customer satisfaction score? Most customers don't have that, you know, on the individual level. What is your role in customer loyalty? Everybody in business should be asking that question, but you can ask it for yourself so you can increase your impact in that area. How do your current relationships with all stakeholders impact your long-term loyalty? So what is— how does that impact the way the business sees you? If you have a particular relationship or non-relationship with someone, does that have some kind of impending impact on how they view you long term? It could well be. I've seen it happen. So we've gone through all of those different areas. So we know, just as a recap here, the whole 8 areas of the customer lifecycle management here for CAM From a CAM perspective, we have advocacy. How are we creating customer champions? Awareness. How do we position our value? Knowledge. How are we educating customers on insights from their business? Consideration. How are we connecting our customers? Selection and assessment. How are we making ourselves easy to choose as a partner, or how are we ensuring that we have the right kind of customer there? Buying. How quickly are customers getting results from purchase? Satisfaction, how good are we at the post-purchase experience? And finally, retention, how are we managing loyalty? Now, if you've really liked this, please listen to it again. I know I can ramble a little bit, but I really enjoy this topic. If you have any questions, just hit reply and just send my team a message, or me directly at jedwards@jermaineedwards.com. I'd be happy to take your questions. But also, I also provide a link, and I want you to read the blog as well, which I provide a little more detail in how to think through these different ideas. But apart from that, wishing you well and also wanting you to pursue mastery in your customer relationships, your customer value, and in customer loyalty, and really become the kind of advisor your customer never wants to leave. I'll see you in the next episode.

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