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Stages is a way to define the lifecycle of a contact. Create stages based on your marketing stages, and move your contacts from stage to stage.
To create a new stage, go to the stages menu identified by a tachometer. Click on the new button and fill in with you relevant data.
Notice MSM uses 'weight' for stages, this is a way to balance your contact's stages. When moving contacts from stage to stage, this will make sure a contact doesn't go back to previous stages.
Use a campaign to move your contacts from stage to stage. When creating your campaign choose a Move Contact to Stage action. So if a contact has been sent an email, or has opened an email, you can select to change the contact's stage based on any campaign criteria.
It is not possible to move a contact to a stage which has a lesser weight than their current stage. For example if they are currently in Stage B which has a weight of 50, you cannot move them to Stage A which has a weight of 25.
Create a lifecycle widget in your dashboard based on segments to also view what stages contacts are in.