1. Lifecycle
to Lifesaver:
C o - a u t h o r e d b y:
Emily Bintz & Chris Salmon
How It Builds Profitable Relationships with
Your Customers through Relevant Communication,
Especially in A Down Economy
650 Century Plaza Dr., Suite 120 • Houston, TX 77073 • 281-821-5522 • www.adplex.com
An Introduction to Lifecycle Marketing
TM

2. Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
2
Timely
communication
with individual
customers
based on a
high degree of
relevancy
Accelerate
the desired
customer
behavior
Maximize
sooner, the
lifetime
Value of the
customer
The purpose of this white paper is to explore what lifecycle marketing is,
how it could potentially benefit your organization, and considerations for
implementing your own program.This white paper will provide you with the
following insights:
• Introduction to and the foundation of lifecycle marketing;
• Why it matters – the potential benefits to your organization in implementing a lifecycle
marketing strategy in today’s economic environment;
• Where lifecycle marketing will work well and conversely, potential pitfalls;
• Visibility into the various strategic approaches to lifecycle marketing;
• Considerations for operationalizing your own lifecycle marketing strategy and program.
Welcome to direct marketing 2.0: Lifecycle marketing is an evolution of commonly
held direct marketing practices that leverages customer behavioral patterns to enable
organizations to more effectively communicate with each customer.
It is based on an in-depth knowledge of natural customer behavioral dynamics and
motivational triggers to predict what customers will do next, combined with the knowledge
of what you as a marketer want customers to do to drive revenue.
How, you may ask, is this different than other forms of marketing strategies that you may
be using right now? Do not confuse lifecycle marketing with efforts such as customer
relationship management (CRM) or loyalty marketing, as:
• CRM encompasses an enterprise-wide framework which organizations use to aid
interactions with customers and prospects. By definition, CRM is more operationally
focused, so that the customer perceives the organization as one entity.
• Loyalty marketing is primarily focused on growing and retaining customers via a tangible
value proposition for the customer. It uses hard or soft benefits and incentives to
economize and emotionalize value with an organization or brand.
In contrast to these marketing principles, the premise behind lifecycle marketing is:
Introduction to Lifecycle Marketing: The Premise

3. At its core, lifecycle marketing is a customer-centric approach to strategic
and purposeful communication. The end game is no longer about what
the brand can do for you as a marketer (i.e. heavy reliance on brand
equity to realize marketing objectives). Rather, it represents a paradigm
shift into the realm of what you can do for the customer! In a competitive
marketplace and in today’s economy, customers are more likely than ever
to switch brands based on price. Building a strong relationship with each
customer, based on their personal interaction with your organization,
could be the differentiator that protects your revenue stream. In order
to build that relationship, you must focus on your customers’ needs and
wants, and not just on what you want from your customers.
Lifecycle marketing is based on the principle that past behavior predicts future behavior.
What does this mean? It goes beyond the accepted customer profiling, segmentation, and
targeting that legacy direct marketing principles are based on. Instead, it employs past
customer behavioral activity data to determine what is likely to happen in the future with a
similar customer and sequence of events. It engages a customer from their first interaction
with a brand through to their last interaction and provides a communication strategy for
each key interaction the customer demonstrates throughout their lifecycle.
The foundation of lifecycle marketing revolves around the fact that no two customers
or customer experiences are exactly alike, nor will they happen at the same time, and
they are shaped by past experiences with the brand. Therefore, customers need to be
communicated with as individuals, triggered by their actions. Make no
mistake - segmentation and profiling are still key elements and
will provide the insight you will need into what is likely to
happen with customers exhibiting certain behaviors.
The difference is that each customer will receive
communications at different points in time based
on those behaviors, or the lack of a behavior.
You must also identify which sequence of
customer activities is most beneficial or
profitable to your organization. By identifying
which path you want a customer to take to
maximize their value to your organization, you
can then devise a strategy that guides them along
this path and timeline. The knowledge of which
path is most advantageous comes from thorough data
analysis, which we will discuss in the next section.
The Foundation of Lifecycle Marketing
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
3
Talk to
each
customer
See Improved
results
Provoke a
behavior

4. • Collect and analyze customer purchase data - trends and purchase patterns
• Append external sources of data (such as demographics and psychographics)
to supplement gaps and provide further insight for customer behavior predictability
• Create predictive models based on purchase history – remember, behavior predicts
behavior.
• Ensure that you can track all post communication customer responce activity and that
data feeds back into the customer database
• For more advanced implementations:
• Link data from the customer service system into the customer database
(inbound/outbound call disposition data, etc)
• Collect customer opt-in, or communication preferences
Lifecycle marketing is based on a combination of the
following five key areas working together to maximize
the value of each customer to the organization:
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
4
DATA
• Customer history - where are they in their own experience with the brand? You will
speak to a first time purchaser differently than a repeat customer.
• Recency and frequency of purchasing - understand when they are shopping and
how often
• Know the customer - what makes them tick, what makes them transact; understand
why they are shopping
• Know what will make them happy and what will make them leave
• First time purchaser vs. repeat purchaser - understand the customer’s mindset at
different points in their experience
• Identify the natural triggers the customer may follow – understand what previous
purchases, behaviors, or interactions have been shown as a predictor of specific
future purchases, behaviors, or actions
• What will motivate them to return or, conversely, what will cause them to disengage?
understand the key milestones and associated timelines in the customer’s experience
that make or break the relationship
• Develop a communication strategy based on the above insight into customer behaviors
and the most profitable series of events
• Time communication in relation to the customer action – be sure it’s relevant!
• Ensure communication supports response tracking to enable measurement and testing
Customer
Behavioral
Knowledge
Motivational
Triggers
Communication
• Validate the predictive models – do they actually predict behavior with a high degree
of accuracy?
• Validate the triggers you believe to be key in the customer’s experience
• Validate customer propensity to change behavior based on communications – up until
what point can behavior be modified?
Testing
1.
2.
3.
4.
5.

5. By leveraging this customer-centric approach, the marketer can identify the demonstrated
behaviors that indicate or predict the likelihood of a subsequent customer action and take
action to modify it, or we can simply benefit from the knowledge.
Example 1: A product-based lifecycle communication
A customer purchased a product at a grocery store. We know
from past customer purchase data that 85% of customers who
also purchased that same product then purchased a specific
other product on their next visit. Logically; therefore, you have
an 85% chance that this particular customer will come in to
the grocery store and purchase this subsequent product.
As a marketer, what do you do now that you’re armed with this
information? There is a correct answer, but without knowing
what the specific objective is and testing based on that, there
could be many options from which to choose. For example,
the correct answer could be one or a combination of the
following:
A. Incent the customer with an offer for the subsequent product so that they come in
sooner and therefore realize the revenue sooner.
B. Inform the customer that the subsequent product is available without an incentive, since
they are likely to purchase without discounting.
C. Wait to see if the customer comes in and purchases the subsequent product, and
if they don’t, then send them a communication with an incentive for the product to
encourage an additional trip.
There are lots of other choices to address this specific situation as a marketer. However,
the point here is that there are options available to realize incremental revenue or realize
revenue sooner than if action wasn’t taken. As a marketer, once you’re armed with this
behavioral customer data, you can explore the best options to take advantage of that
knowledge and to further your organization’s goals.
Example 2: A timeline-based lifecycle communication
A customer visits a dry cleaner for the first time and spends $30. Past data shows that
previous first-time customers who spend between $25 and $50 typically return to the dry
cleaner within two weeks. So what do you do if the customer has not returned in two weeks?
How long do you give them before you reach out to them? Refer back to the data - it will
tell you. In this case, we know that customers who don’t make a second purchase within
four weeks of their initial purchase rarely return to the store. You would be well-suited to
communicate with this first-time purchaser if, at two and a half weeks, he has NOT returned.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
5

6. A communication should be triggered to let the customer know that:
A. You have noticed their absence and want their return business; and/or
B. You will incent them to return.
Keep in mind that these are extremely siloed examples of a bigger picture, but represent
what is meant by guiding a customer through their experience. If they are not following the
path that generates maximum results for your organization, you must take action to correct
their course. In order to do this, you must know your tolerance for customer behavior – how
far outside the desired path will you customers go before you communicate with them to
try to affect behavior? Testing will be required in order to determine how much leeway you
will give customers to act outside of the desired path and to identify when it is too late in a
particular stage of the lifecycle to still impact a certain behavior.
Dialogue… NOW
As you probably noticed from the previous examples, one of the pillars of lifecycle
marketing is that it is based on communication with the customer in a time-sensitive
environment. Imagine, if you will, a new customer goes into a grocery store and makes
a purchase for the first time. There is no point sending that customer a ‘Thank You’
or ‘Welcome’ message three to six months after that first visit. Essentially, the window
to communicate these messages has passed, and therefore, the communication
is no longer relevant to the customer. The same can be said for the vast majority of
customer interactions. There is a defined timeframe for which lifecycle marketers have to
communicate a specific and relevant message.
Also, notice that this section is not called ‘Communication… NOW ’. Lifecycle marketing, in
its purest form, is based on a dialogue with the customer, demonstrating to them that you
know who they are, have acknowledged their interaction with you, and that their business
really matters to you.
So What Does This Mean as A Marketer?
By combining data, customer behavioral knowledge, an understanding of motivational
triggers, and knowledge from testing results, the marketer can then develop a robust
communication strategy based on a behavior (or the lack of a behavior) and provide the
customer with a message that will be relevant and therefore:
• Resonate with the customer because it’s based on the customer’s specific interaction
with the organization;
• Engrain the organization further into the customer’s purchase habits and keep the
organization top of mind, and;
• Promote a response that achieves business goals.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
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7. Why it matters – the potential benefits to your organization in
implementing a lifecycle marketing strategy in today’s economic
environment
Simply put, because it works!!! In today’s economic environment, lifecycle marketing
affords marketers an opportunity to optimize their marketing budget. Additionally, there
are very tangible competitive, customer, and process-driven benefits to implementing a
lifecycle marketing strategy.
Marketing Efficiencies
By understanding customer behavioral patterns and applying that insight to marketing
efforts, it realizes marketing efficiencies that result in incremental sales. Focusing marketing
dollars on customers who are not already following the desired purchase path and letting
others take their course ensures that little marketing is wasted on sales that would have
occurred organically.
Start Small,Think Big
Any lifecycle marketing program is a living, breathing, dynamic solution. Depending on
what your situation is, there is a wide range of lifecycle-based marketing principles that
you can apply. The possibilities are endless! For example, in today’s unstable economy,
a lifecycle marketing program will allow you to focus your marketing dollars only on the
desired customer behaviors that matter most. Whether your focus is to retain certain
customers, increase value of existing customers, or even win back lapsed customers,
a lifecycle strategy can adapt to whatever the business objectives require. As market
conditions change, the level of investment can change as you ramp up communications to
cast a wider net and reach additional customers by incorporating more behavioral triggers.
Even with limited historical customer data, you can still leverage the principles of lifecycle
marketing, just by knowing your business and the experience your customers have with
your organization. A simple “thank you” after a first purchase is the start to a good lifecycle
communication plan.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
7
Little Intervention Needed
Moderate Intervention Needed
Significant Intervention Needed

8. Holistic and Sustainable Approach vs. Quick Revenue Infusion
It is very easy to fall into the pattern of being reactive to short-term marketing objectives.
We’ve all fallen victim. Lifecycle marketing, on the other hand, offers a holistic and proactive
approach interacting with your customers and the value they can bring over their lifetime,
not just in the next few weeks or months. It’s to this point that lifecycle marketing is a
sustainable strategy. For every demonstrated key interaction (or lack of one) the customer has
with your organization, there is a communication opportunity designed to speak specifically
to that and to what you would like for them to do next. What is the real benefit of this? Read
on!
The Sweet Spot
As relevance of communication increases, so does ROI. Why? It’s a combination of factors
working in concert:
• By utilizing existing customer data to predict the
likelihood of a behavior, what you’re communicating
resonates more with the customer and responses are
higher;
• Not communicating to and wasting marketing
dollars on customers whose behavior is not likely
to be impacted by marketing communications,
no matter how relevant;
• Reducing or eliminating communications to
customers already exhibiting the desired behaviors.
The combination of these factors will eliminate
needless marketing expense, while maximizing the dollars you do spend, resulting in a
higher ROI.
Predictable Over Time
As you learn the behavioral patterns of your customer base and develop a communications
strategy around that, coupled with knowing the impact you can have, you will be able to
forecast with greater accuracy the incremental revenue you can bring to the business. In
addition, you will eliminate the need for the quick hit revenue-generating campaigns that
provide limited visibility and results predictability. If you operate in a reactive environment,
future goals and objectives may be unclear. This situation suggests that implementing a
lifecycle marketing program may be to your advantage.
Improved Relationship with the Customer = Improved Customer Lifetime Value
More and more as you demonstrate to the customer through relevant and timely
communication that you understand their needs, and that their business matters to you,
your relationship with that customer will grow. Essentially, this will foster a ‘top of mind’
mentality for the customer with regard to your organization, and the customer will become
more loyal as they become more engaged. When a company communicates with a
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
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L H
H
ROI
RESPONSE
M
a
s
s
Ta
r
g
e
t
e
d
Lif
e
C
y
cl
e

9. customer based on their individual and personal interaction, the customer feels known,
understood and appreciated. The end result is that you will get more ‘share of customer’,
(a concept that is born out of the fact that customers shop several competing brands and
therefore share their value). A major upside to this new, closer relationship is that during
economic times such as these, where every customer counts, you will be better positioned
than your competition to retain your customer base and maintain and even grow revenue.
Where lifecycle marketing will work well and conversely,
potential pitfalls
As the title to this white paper suggests, lifecycle marketing can certainly be a lifesaver.
Indeed there are many benefits to implementing such an approach, as documented in the
previous sections. However, there are also limitations where lifecycle marketing is just not
the best fit. To this point, there are situations where lifecycle marketing will work well, and
situations where it will not work well:
Any company in any industry that has customers and meets the above requirements can
apply some form of lifecycle marketing strategy. Industries such as retail, banking and
financial services, insurance, and service industries such as telecom, cable and airline,
are particularly ripe with opportunity. Other industries may have less frequent customer
interactions, but the opportunities are still there. Just think about what matters to your
customers and take advantage of opportunities to communicate with them at those key
milestones.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
9
• Data infrastructure exists to support the
foundations of the strategy
• The customer makes multiple
transactions over the course of their
interaction with the organization
• The organization exists in a competitive
or commoditized environment, where
customer relationships can be a key
differentiator
• Customer volume exists to support the
investment
Situations Where Lifecycle Marketing Will…
…Work WELL …NOT Work WELL
• The purchase cycle spans over a long
time period
• No historical customer data exists*
• No data collection process exists*
• The organization lacks commitment to
the program – there is no enterprise-wide
buy-in
• The organization has poor operational
compliance
* Note that these two barriers can be overcome relatively
easily. The others represent more severe barriers

10. The Various Forms of Lifecycle Marketing Programs
Hopefully by now, this white paper has provided sufficient insight into the benefits and
applications of lifecycle marketing, and you’re beginning to think about how you might apply
it to your situation. As with any marketing solution, there are varying levels of implementation.
Outlined below are three general levels of implementation. Based on your organization’s
existing data and desired commitment, you can choose the model that works best for you. It
will likely evolve over time as you become more sophisticated in your data collection, analysis,
and application of the lifecycle marketing strategy.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
10
Basic Level Intermediate Level Advanced Level
Lifecycle marketing replaces the
majority of ongoing marketing efforts
Purest form of lifecycle marketing;
Incorporate customer feedback and
preferences with purchase data to
maximize message relevance and
increase likelihood of desired response
Segment customer base into six major
segments & sub-segments based on
RFM, product mix & enterprise-wide
customer feedback (all in/outbound
customer interaction points):
• New Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
• Young Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
• Active Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
• Churning Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
• Returning Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
• Inactive Customer
o RFM
o Product mix
o Enterprise-wide customer
feedback
Multi-channel depending on customer
preferences
Highly personalized and dynamic
content based on previous interaction
and desired next interaction
301+
Daily delivery (not batched) – truly
individualized
Data segmentation and delivery is
automated
Strategy
Approach
Segmentation
Examples
Channel Strategy
Personalization
Number of
Behavioral
Triggers
Communication
Timing
Automation
Begin to transition existing marketing
efforts to lifecycle marketing, as it becomes
more integrated into your approach
Incorporate additional information,
including products purchased, to
develop even more relevant and timely
communications
Segment customer base into six major
segments & sub-segments based on RFM
& product mix:
• New Customer
o RFM
o Product mix
• Young Customer
o RFM
o Product mix
• Active Customer
o RFM
o Product mix
• Churning Customer
o RFM
o Product mix
• Returning Customer
o RFM
o Product mix
• Inactive Customer
o RFM
o Product mix
Single or multi-channel (email, direct mail,
etc)
More detailed segmentation, increased
number of triggers, and more frequent
communications enables higher relevance
51-300
Bi-weekly batch delivery
Data segmentation is automated
Used to supplement existing marketing
efforts
Communicate with customers based
on fundamental levels of interaction;
Grounded in customer data collection
and analysis
Segment customer base into six major
segments based only on RFM (Recency,
Frequency, and Monetary values):
• New Customer
o RFM
• Young Customer
o RFM
• Active Customer
o RFM
• Churning Customer
o RFM
• Returning Customer
o RFM
• Inactive Customer
o RFM
Single channel (email, direct mail, etc)
Limited by level of segmentation and
frequency of communications
1-50
Monthly batch delivery
None

11. As you can see, there is a wide degree of variance in the level of sophistication and
organizational involvement from the Basic to the Advanced approaches. Hopefully this
demonstrates that just about any organization with customer interaction can begin to
implement a lifecycle marketing program and reap the benefits of more relevant customer
communications. In the next section, we’ll discuss key areas of consideration as you begin
to think about implementing your own lifecycle marketing program.
Considerations for Operationalizing Your Own
Lifecycle Marketing Strategy
Start with The End in Mind
There are several elements that need to be addressed before you start to operationalize
your own program to ensure that it will be supported throughout the organization. The first
and foremost is your business or marketing objective. At a very high level, what do you
want to get from a lifecycle marketing program? And, more importantly, is that objective
quantified so that you can setup for success? For example, if you are looking to...
• Maximize spend from existing customers;
• Improve retention rates; and/or
• Lift spend with new customers,
...by how much are you looking to move the metric for each criterion? Once you have
decided what your objectives are, there are several significant operational aspects that you
need to take into account.
Enterprise-Wide Involvement – Is It Needed?
Yes and no. The need comes down to what kind of program you are looking to implement—
you don’t have to jump in with both feet. In fact, it’s recommended that you don’t.
At the most basic level, enterprise-wide involvement is not necessarily needed to get
started. All you need is customer contact information – mailing or email address – and
some type of purchase data. It can be as simple as knowing when a new customer has
made their first purchase with you. Begin your lifecycle marketing program by sending a
“thank you” postcard (with or without an offer) to them.
As your program grows, the key to the long-term success of any lifecycle marketing
strategy is ensuring that you have enterprise-wide buy-in and support. The best lifecycle
marketing program in the world will not work if customers have a consistently bad
experience with your organization. From the CEO to the receptionist; from IT to marketing,
each department and each employee must be aware of and understand the strategy that
is being used to communicate with customers. By focusing each communication on the
customer experience, you will hopefully set the example that everything that is done on a
daily basis also must focus on the customer experience.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
11

12. Continuous Improvement
You’re not going to ‘crack the code’ right off the bat. As with
most forms of direct marketing, one of the most fundamental
approaches to any implementation is the incorporation of a
testing strategy, or learning agenda. This is true, especially
in lifecycle marketing, since it’s based on a continuous
communication flow.
If you’re not sure where to start, think about the process your
customers go through when interacting with your organization.
What are the intuitive key interactions? Select one or two
potential triggers and begin to test if they really matter. Take a
statistically significant subset of the customers in the lifecycle
stage you have identified and send them a communication
(your test group), while leaving the rest of them alone (your
control group). Be sure to design a program where you can track and measure your
responses! Then, simply compare the results of the test group vs. the control group. If they
are statistically different (with a more positive result on the test group), you have found your
first key trigger! Build upon that, and then begin testing the next trigger, and so on.
Internally Driven, Externally Managed?
Perhaps you don’t have the human resource bandwidth to implement a lifecycle marketing
program, but you’re still interested. Working with an outside partner could be the solution for
you. External partners, such as Adplex, can help devise a strategy, implement and track the
results of a program, and provide actionable recommendations and insights to further your
organization’s specific goals.
Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
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13. Lifecycle To Lifesaver: An Introduction to Lifecycle Marketing
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About The Authors
Chris Salmon, Director of Strategic Marketing
Chris has over 10 years of experience working in different marketing capacities. With
perspective into both client-side and agency-side; Chris has a holistic marketing
background in direct and interactive marketing. He has a strong foundation in the
development and management of loyalty/retention and acquisition/lead generation
marketing programs for retail clients. Throughout his career, he has worked with
financial (American Express, Alliance Data, and Metris), telecom (AT&T, Cingular), and
pharmaceutical (Merck-Medco) B2C and B2B clients.
Emily Bintz, Director of Strategic Marketing
Emily is a marketing professional with 9 years experience in product marketing and
management, account development, and holistic marketing program development and
execution at both B2B and B2C firms, notably Xerox, Time Warner, Comcast, and One
Communications (telecom). With a full understanding of financial analysis and short and
long-term goal setting, her specialties include: Customer Lifecycle Marketing, Customer
Retention & Loyalty Programs, Analysis and Strategy Recommendations, Product
Marketing, and Customer Communications. Emily has a BA in International Business and
Spanish from Grove City College (PA) and an MBA from Sam Houston State University (TX).

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TM
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