You probably know that acquiring a new customer can cost up to five times more than retaining an existing one. Is there anything more frustrating than when a customer becomes inactive or seems to lose interest in your business? Even when this happens, you fortunately have a 60-70% chance of success of selling to them again. In comparison, your potential success rate for selling to a new prospective customer is just 5–20%.
So, how do you successfully re-engage inactive customers? You need to have a carefully considered reactivation strategy formulated and marketing incentive programs in place. By offering rewards when your inactive customer takes a specific action, such as re-starting their subscription or completing a new purchase, you have a much higher likelihood of winning them back.
Previous customers are 50% more likely to try a new product. But you can’t win everyone back — you need to focus your attention on individuals who are most likely to become active again. If a customer doesn’t fit your ideal criteria or has a low lifetime value — use your budget, resources, and time wisely and just let them go.
Use the data you already have on customer behavior to show you who is most likely to return to your business. Review your data and take a note of your most valued past customers. Look for:
Increasing customer retention by just 5% can increase your profits by as much as 95%. Personalized incentives are a great way to bring previous customers back to your business and retain them. Customers leave for all sorts of reasons — including pricing issues, poor customer service, product or service limitations, and more. To target them effectively, you need to tailor your incentive to match the individual.
To run a solid incentive program and win back your customers, you need to take the following into consideration:
Incentive programs are a great way to win back and retain customers. 75% of consumers say they favor companies that offer rewards. In addition, the more personalized the reward, the better — 56% of customers stay loyal to brands that understand them. Sending the perfect reward with hyper-personalized content is a powerful way to make your customers feel seen and appreciated by you.
When you leverage a platform such as Aklamio’s Customer Incentives Platform, incentives can be sent out to the right customers at the right time. When you use a fully-managed platform like Aklamio’s, you no longer have to monitor manually — saving you time and helping you optimize your marketing budget. When you use an incentive platform, you can:
When you make a reward immediately available to someone, at the right time and on the right channel — you increase the likelihood they will accept it. You can add an expiry date to create a sense of urgency, further increasing the chance that they’ll accept your reward — using urgency can increase your chance of making a sale by up to 332%.
Monitor the results of your incentive program to help ensure you’re using your resources efficiently. Choose a platform that gives you access to the following: robust tracking and deep analytics to monitor performance and understand incentives, marketing campaign contribution, customer lifetime value, and ROI. Monitoring a variety of key metrics will help you assess how effective your current rewards program is and how you can best optimize it.
The more relevant data you have, the higher the likelihood you can improve your results. Continuously test and optimize your incentive programs using the valuable data that they generate. Test variables like reward value or timing to find the right elements for a favorable conversion rate.
At Aklamio, we believe that incentive marketing programs can form an important part of your marketing mix. These programs aim to keep customers engaged with your brand through the use of offers and incentives. But since it’s simply unrealistic to expect every single customer to stick around forever, incentive programs can supplement your marketing efforts when customers need a little extra nudge.
As we explored in the opening of our post, it costs five times less to retain a customer than it does to win over a new one. But some customers will require work on your part to become reengaged with your brand and continue to buy from you now and far into the future. By focusing on the right inactive customers and offering personalized, targeted rewards, you can start to win back your past customers — improving retention rates and increasing your revenue.
Curious to learn more how Aklamio can help you? Please reach out to us here.
May 20, 2022
May 17, 2022