Customer marketing | Customer retention | Customer segmentation | Article

The realm of the existing customer is where customer marketers have the most impact. So when customers leave, a part of the customer marketer's responsibility is to try and get them back! This is where customer reactivation marketing comes in.

This article with go through:

This guide will help you set up a strategy for your own existing customers.

What is customer reactivation marketing?

Customer reactivation marketing focuses on two elements. One is to win back customers that have lapsed or churned. The other is to prevent this churn from happening in the first place, but, more specifically, to prevent lapsed customers from churning a second time.

The customers that are involved in this process are ones who have previously expressed an interest, purchased a product, or subscribed to your service but have since gone inactive or stopped paying for the products you provide.

What are the benefits of re-engaging customers?

There are many benefits to re-engaging customers, such as increasing your customer base, and the ability to target customers who already know who you are (and may have even spent money with you before).

Your approach to this type of customer must be personalized and specific to them and their history with you. Doing so provides benefits like:

Higher probability of success

Engaging in a reactivation campaign is a far easier way to ensure a steady revenue stream and customer numbers. Selling to existing customers is far easier than marketing to new ones; the success rate of closing a sale with existing customers is 60-70%, a massive increase from the 5% success rate with new customers.

This isn’t to say that acquiring customers isn’t important, as they’re still a part of a company's growth. Rather, this is to showcase how important it is to not neglect your existing customers, even lapsed ones.

Customer reactivation is easier than customer acquisition, so why not make space for it within your existing strategies?

Reduce customer acquisition costs

Speaking of customer acquisition, did you know that it costs up to five times more to try getting prospective customers on your side than it is to retain and reactivate the customers you already have?

On top of that, convincing a new customer to make a second purchase has a 27% chance of success, which then increases to 54% with a third purchase. These changes go up each time a purchase is made.

So, why waste your valuable time and money when you already have a dedicated customer base who knows who you are and your value to them? Customer reactivation is just the process of giving these same customers a little nudge in the right direction.

Increased revenue

Customer reactivation marketing isn’t only a good way to save money on marketing and making sales, but can actually increase revenue too. Inactive customers are people who have already used your product or service before, and may even have been longstanding and loyal customers.

Engaging with these customers is more likely to produce the same behavior. Once they’ve begun purchasing with you, they’ll likely fall into the regular habits that they had with you before.

Strengthening client relationships

Lapsed customers are not only good sources for growth when you successfully re-engage them but are also an invaluable source of information on your current practices throughout the customer lifecycle.

Plus, reaching out to these customers is a fantastic way to show that you noticed they were missing, and care about them.

Gain competitive intelligence

Another great way these types of customers can help is to give you insights into where you went wrong, or what you’re missing. Reaching out may not get them to come back to your company, but you can ask why they left in the first place.

If your competitor is offering something you aren’t or a feature that made these customers change vendors, this is vital for you to know. Then you can make the changes to fix it.

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How do you get your customer's attention?

Seeing as these customers no longer frequent your websites/social media/stores etc, they may be more difficult to get a hold of than before - but not impossible. Here are a few options:

  1. Contact them directly: Sometimes the simplest answers are the best. Send them an email letting them know that you’ve noticed their absence. And don't forget to ask them to come back!
  2. Advertise on similar platforms: Algorithms used by places such as YouTube and Instagram do a good job of personalizing ads depending on the user. If previous customers see your brand in this marketing campaign, it may jog their memory of how you helped them in the past.
  3. Content marketing: Another way to increase the awareness of your brand is to do some content marketing. These can be events, blogs, a podcast, and more. This style is not as targeted as the others, but goes a long way to getting your name out into the space which will be picked up by new and existing customers alike.

What are some different ways to use your customer's data to target them?

Using the options above, you now have to decide what kind of content will catch your customer's attention enough for them to return to you. Most often, this comes in the form of direct contact and offering them specific discounts or programs that’ll make it worth their while to keep buying from you.

Reactivation email campaign

Knowing that your customers have lapsed in their regular spending habits, means that a variety of things have happened to change this habit. Some of it may be out of your control like lifestyle and budget changes, and some may not, like having a new competitor that offers something you don’t.

So, the first thing to do is to go directly to the source with email marketing. To get re-engagement, make sure your name is seen, and the easiest way to do that is to go directly into their inbox. This way, you can provide them with special offers directly. You can also ask them why they’ve stopped buying from you. If you know why, then you can more quickly solve the problem.

The second thing to do is to consider what changes you can make to reduce churn based on the trends within the answers. Use email campaigns to keep these people updated on any changes you make, and keep your name in the conversation when they think about the types of products or services you provide.

A quick tip: Make sure the subject line of your email is engaging and immediately eye-catching. It’s likely that these customers are already receiving emails from you but not opening them, so make sure the call to action is simple but immediately enticing.

Offer a special promotion

When it comes to budgets, there are offers you can make to help sweeten the deal when they return. The most common version of this is to offer a percentage discount.

Also, don’t be afraid to use the purchase history of the customer to personalize the offer, and give them some recommendations that might reignite their interest.

Loyalty programs

Loyalty programs are another great incentive for people to both return to buying from your brand and remain loyal to it as well. This is perhaps a better option in the long term, as the offer you give these customers relies on them making repeat purchases.

This doesn't have to be anything big (like loyalty cards at coffee shops), or you can go full out by offering them early access and unique discounts. Think about your customer base and consider which option may work best for each segment.

Read more on customer segmentation in our article below:

Ultimate guide to customer segmentation.
Customer segmentation is a tool used by businesses that sorts and categorizes your existing customers by certain characteristics. This tool has a multitude of benefits, which we’ll be going over in this comprehensive guide.

Learn to let go

One of the most important things to understand when it comes to reactivation marketing is to respect your customer’s boundaries. Reaching out to customers that have lapsed is a vital part of maintaining growth, but with this process, you are going to find there’re customers that aren’t interested in keeping up a relationship with your brand.

Take the steps we’ve outlined above but be aware of your customer’s responses to this outreach. If they’re not interested in returning to your brand and aren’t interested in providing feedback, then respect that option and let them know they can opt out of your contact list.

The one thing worse than lapsed customers is negative reviews, so don’t give them a reason to complain!

Simple strategies for reducing customer churn

If your churn rate increases, this can have a catastrophic impact on your short and long-term goals. Therefore, you need to consistently measure appropriate metrics to mitigate the risk of customer churn and solidify your customer retention rates.

This article focuses on:

💭 What is customer churn?

📈 How to calculate customer churn

💰 Why is low customer churn important?