Is your business as focused as it should be on customer retention? You may have heard statistics that it is 5 to 25 times more expensive to find a new customer than it is to keep a loyal one. What’s more, an increase of 5% in customer retention can lead to revenue increases of 25% to 95%, according to the Harvard Business Review.
Of course, new-customer acquisition keeps your business growing. But there’s little dispute that customer retention and customer win-back should be an important part of your lifecycle marketing strategy. Customers who have purchased previously tend to buy more over time. Repeat customers also tend to refer your brand to others, and the more they buy, the more operational costs drop with each purchase.
When you consider a customer’s lifetime value, you’ll see that it pays not just to keep customers but to keep the right ones. A solid customer win-back strategy can help you accomplish that.
What Is a Customer Win-back Strategy?
It’s pretty clear that customer win-backs are just as important as new-customer acquisition — maybe even more. Your win-back strategy should first look at your customers’ needs and pain points, to create content that delivers a personalized experience. A win-back strategy should include multiple touchpoints to make an impression and remind customers why they loved your brand.
You may need to address perceived shortcomings as you work to win back customers. Coupons and promotions can help sweeten the deal if cost was a concern. New product lines may help attract attention. To drive customers back to your brand, you first need to determine why they left.
How to Develop an Effective Customer Win-Back Strategy
Your customer win-back strategy should begin with one question: “Why did they leave?” Only then can you plot the right path to win them back.
Sometimes, customers leave because they “age out” of your product. A business that sells infant clothing lines, for instance, may have a higher rate of customer churn than one that sells bathing suits for adults, which people need year after year.
However, people also stop buying from a brand for other reasons that are ripe for win-back. For instance, they might believe your product or service:
- costs too much
- doesn’t meet their needs
- isn’t as good as what competitors offer
- does not provide a good customer service experience
Customers may also leave because you simply didn’t stay in touch, and they forgot how much they liked your brand. These especially, represent good prospects to target, because they didn’t have any issues you need to address. A simple coupon or an email showcasing new products may do the trick to win their loyalty.
Tactics to Win Back the Right Customers
Once you’ve explored the reasons people leave, you can work on personalizing the experience and using the right tactics to win them back. As with any marketing campaign, you want to determine where they are in the sales funnel and tailor your outreach to meet them there. With customer win-backs, though, you have an edge — because you know that at one point they were interested enough in your company to buy.
As with any lifecycle marketing strategy, you want to generate the right content and deliver it at the right time through the appropriate channels, which can range from email and SMS to organic and paid social media.
Use Email Marketing to Catch Attention
Email marketing remains one of the most cost-effective means of outreach; it tends to drive approximately 20% to 30% of revenue for e-commerce businesses. Make sure to use an enticing headline to pique the recipient’s curiosity. You might include news of a new product launch, a coupon or special sale or even a link to an on-site eCommerce quiz that can help them determine what they might like to buy and subtly remind them how your products are a good fit for their needs.
Leverage Retargeting via Social Media Ads
People spend so much time on their favorite social media platforms. Using paid advertising and retargeting can jog their memory about why they loved your brand. Showcase some of your best-selling products in an ad on Facebook to gain attention. Use personalization techniques and look-alike marketing to show past customers items that are similar to and maybe even better than their past purchases.
Reach Customers Where They Are With SMS Marketing
With inboxes filled nearly to capacity, SMS marketing tends to see higher open rates, experts say. Eric Jung, an SMS marketing expert, says his clients see a 20% to 25% click-through rate via SMS, compared with about 2% to 3% from email.
If you have a brick-and-mortar business, you can use geo-targeting to send a text with a coupon when a former customer is in your area.
Build Brand Loyalty to Win Back Customers
Loyalty and rewards programs are a great way to retain customers. Some of your former customers may still have loyalty accounts but haven’t used them in some time. Show them what they are missing in terms of loyalty discounts, sales and promotions. Create a fear of missing out through positive customer reviews and stories of satisfied customers who earned free merchandise or extra discounts.
Rely on a Full-Service Agency to Develop Your Customer Win-back Strategy
A full-service marketing agency can help you develop your customer win-back strategy and deliver the content you need to reach your customers at multiple touchpoints. Understanding why your customers left is the first step. After that, you’ll want to narrow down the strategy to those who are most likely to return and determine where they are now in the sales funnel.
From email marketing campaigns to social media, SMS, and blogging, Hawke Media’s team has the expertise to drive your customer win-back strategy at every level. Learn more about us here.
Sources
HubSpot.com – Here’s Why Customer Retention is So Important for ROI, Customer Loyalty, and Growth
Harvard Business Review – The Value of Keeping the Right Customers
Forbes – Does It Still Cost 5x More to Create a New Customer Than Retain an Old One?
Bain & Company – Prescription for Cutting Costs