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Customer life cycle

The customer life cycle considers the stages and economics of a customer relationship, from acquisition and onboarding through service, retention and possible exit. Costs and revenues can vary substantially over time, so an isolated first-sale margin may misrepresent the relationship. Estimates should recognise retention uncertainty, support needs and timing. It differs from the product life cycle and from simply assuming every long-standing customer is profitable.

Worked example

A contract incurs a large onboarding cost but may earn recurring contribution for several years if the customer remains and service costs stay within the forecast.

Common mistake

Do not treat forecast future renewals as certain or ignore expensive customers because their sales revenue is high.

Where it appears in your exams

QualificationExamRelationshipPeriod
ACCA APM Supporting September 2026–June 2027
ACCA PM Supporting September 2026–June 2027