All marketers have heard it before: acquiring a new customer is usually more costly than getting an already-acquired customer to repurchase.
But given that we all know how valuable repeat customers are, it’s surprising how little effort many online retailers put into re-activating customers that are at risk of lapsing, especially those who have been great customers in the past. In the world of customer relationships, retailers’ approach should be more Rick Astley and less Ariana Grande.
With 61% of consumers frustrated that their loyalty is not recognised – the loss of existing customers is something that remains an issue for retail marketers.
Losing a few customers here and there is part and parcel of running an online store, but by using advanced strategies to win back lapsed customers, online retailers are missing out both an opportunity to re-align consumers to their brand and increase revenue.
This blog post aims to provide an overview of how you can use advanced tactics in your emails to win back lost customers and provide them with tailored content that reminds them your recognise their importance as a shopper with your brand.
The answer isn’t always simple as there are a few things, beyond your control, that may cause a customer to lapse. Here are some examples:
Their circumstances/interests have changed: they’ve left the country, you’re a golfing equipment retailer and they’re not into golf any more, they used to buy presents for their partner but their relationship status has changed ( ).
They’ve changed email address and have signed up for a new account: this can cause duplication, which can be frustrating but you can begin to address this by with the right tech.
They bought something because of a great deal you were offering: they’ve purchased with you but they were never really that engaged with or interested in your brand.
Your emails might be falling into their junk mail folder: this means that your emails are not being seen, so can’t be engaged with. A great way to remedy this is putting an ‘add us to your address book’ CTA in your emails.
Other reasons may include:
They’re a gift shopper and buy from you only very occasionally.
They had a bad experience with you for whatever reason and have decided not to come back.
Your product offering has changed, and they’re just not that into you anymore.
Your marketing messages just aren’t doing it for them.
While some of the above may be things that you can’t control, where you can take ownership is the win-back campaign you use to get lapsing customers re-engage with your brand. A bad customer experience? If customers have great experiences with you both off and online, they are more likely to stick around and also more likely to forgive your brand for any mishaps because of it. Unclear marketing messages? This is where perfecting your win-back strategy comes in so you can deliver clear, concise and relevant content to entice them back in love with your brand.
How to identify a lapsed customer
The definition of a lapsed customer will vary from retailer to retailer, based on factors like their product offering and sales cycle. For example, for a mattress retailer the definition of a lapsed customer may not come into play for years, whereas a beauty brand may define a customer as lapsed after only a few months.
One way of identifying the moment you should consider a customer ‘lapsed’ or ‘at risk’ of lapsing is using a method called ‘Order Gap Analysis’ which we cover in depth in this blog post. OGA calculates the average time between all the consecutive orders made by each customer, leaving you with an average time it takes your repeat customers to repurchase. The result can be used to define when your win-back strategy kicks in.
A note on offline data: if you sell both online and offline, it’s important to ensure that your win-back strategy is based on activity on both channels. Simply basing your win-back strategy around online activity may result in you sending a confusing message to a shopper who regularly shops with you offline.
With a full view of each customer’s behaviour, interactions and transactions with your store, you can craft tailored messages to shoppers that makes them feel seen and encourages them to come back and spend with you again. So, what does a good win-back campaign look like?
What a good win-back email campaign looks like:
We’ve taken a look at some of the causes of your customers lapsing and by making a few alterations – advancing your tactics that step further by using data to create content specific to your customers – you can create campaigns that will encourage them to come back to you.
1. Personalise the contents of the email
Lapsed customers – more than any other group – may need more convincing to come back and shop again, so ensuring that the contents of your messages to them are spot on is key.
By including images and items specifically relevant to that shopper, you re-align them with your brand and remind them of why they loved you in the first place.
It’s important to consider the lifetime value of your customers and go the extra mile if they have been a consistent high spender with you. This can be achieved by segmenting your customers based on their CLV or ‘VIP status’, and crafting a campaign that befits them.
Depending on whether you want to send a series of emails or just the one, you can also include an incentive – such as a discount – to encourage them to make a purchase of the recommended items.
2. Consider cross-channel
For those who aren’t engaging with your emails, you can take your win-back campaign cross-channel.
Although getting a customer to open an email is a good start, the contents of that email will make or break whether you win them back or not. Here are some different approaches to the contents of lapsed customer emails – dependent on the customer, you may want to create a campaign workflow that involves a few of these examples to get them to come back to you.
A win-back offer email
Give lapsed customers an unmissable incentive to encourage them to get back buying, this can range from discounts to non-monetary perks.
What we love about these campaigns:
How these campaigns can be advanced:
An offer follow-up email
If a lapsed customer doesn’t respond to your offer by coming back and purchasing, you may want to either:
send them a follow up email to remind them about the offer (making it time limited to create urgency can be a good tactic or send them an even better offer than before (though this risky, as customers may get wind of your tactic and keep holding out for better offers).
What we love about this campaign:
How this campaign could be advanced:
What if a lapsing customer is still active on your site?
If a customer has been browsing but not buying, personalise emails with products and categories that they’ve viewed or shown an interest to encourage them to make a purchase, much like Dollar Shave Club:
And what if a lapsed customer is not active on your site?
This is the step before the final step before you start sending a re-permission email. If your once-active customer has stopped visiting your site or opening emails, it’s important to remind them about what they’re missing.
What we love about this campaign:
A re-permission email
This type of campaign should be treated as a last port-of-call in win-back campaigns, checking in with your customer as to whether they still want to engage with your brand emails.
The below examples highlight great ways to give that last push to encourage a customer to engage or ask whether they would prefer to unsubscribe (keeping you GDPR compliant).
What we love about these campaigns:
Don’t just shrug your shoulders and let your lapsing or lapsed customers ride off into the sunset: put them onto a dedicated win-back email workflow until you win them back. Once you’ve decided what time frame constitutes a customer being deemed ‘at risk of lapsing’ or ‘lapsed’, segment your lapsed email campaigns for better results. You could segment by:
When it comes to the contents of the email, try experimenting with one or more of the following:
Your customer’s journeys should feel personalised from start to end and whether they’re at risk of lapsing or a frequent spender. Your win-back emails need to be more engaging than ever if they’re going to meet their goal of persuading shoppers to come back. Using what you know about the individual customer to personalise each message improves your chances of winning a lapsed customer back around.
Take the first step toward smarter customer marketing