Increasing sales is often associated with gaining newer customers, but customer acquisition statistics show it is much easier to sell to your existing clientele. It costs at least five times more to gain a new customer than it does to sell to an existing one. This is why a lot of businesses are putting their focus on customer loyalty programs.
The goal of a customer loyalty program is to maintain existing clients by ensuring they are happy with a brand. Once someone has made a purchase from your company, you should have a lot of valuable information to market to them. Gathering a list of your existing clients should be a simple process, and in most cases, a process you can easily automate from your point of sale system.
Once you have a list of all your existing clients, you will notice this list can be segmented into active and inactive clients. To be able to make a clear distinction between the two types of customers, it’s necessary to figure out what is the average lifecycle of an active client. The lifecycle of a customer will depend on the type of products or services you offer. In most cases, companies can determine how long their products will last and in turn how long it will take for an existing customer to make a new purchase.
To give you an example of how an average customer lifecycle can be calculated, think about companies that sell auto tires. These companies know the expected lifespan of a tire’s tread is three to four years. This means a tire company can expect their existing clients to purchase a new set of tires every three to four years. Once a tire company has their existing customer list, they will be able to separate it into smaller groups to market to appropriately.
There are many different retention strategies you can implement to engage your existing clients, and loyalty programs are a great way to do this, but what about those clients who are inactive or dormant? Before you count them as part of your company’s natural churn percentages, try these five steps to re-engage them.
1. Define who those inactive customers are. As we mentioned previously, you can segment who customers are depending on specific timeframes that are based on their buying cycle. Once you have this list, there will be additional segmentation you will be able to do. If you have collected information about what they purchased from you, you can group them by product. This will help you tailor a meaningful approach to re-engage them.
2. Determine why they left. A good way to find out why a customer is no longer using your products is with a survey or even with a simple call. Some companies start these phone conversations by saying they are part of quality control program and would like to find out how the products are working out. Another way to start these conversations could be by calling people to update their existing contact information. Whatever approach you choose, the important thing is to be able to reconnect and find out if you can address their reason for leaving.
3. Set up a contact strategy. Once you have reached out, you should be able to determine which of these customers is open to being engaged again. If so, you can add them to your monthly mailing lists for printed communications, text messaging strategy, or even a personalized message tailored specifically for them.
4. Develop a “win back” offer. There are many different offers you can test when it comes to winning back your inactive customers. For example; offer exclusive discounts for returning customers, or provide a free trial for a newer product. If you have segmented the group of inactive customers by products purchased, you can conduct A and B testing with your offers and to each group offer something different. This will allow you to see which offers perform the best.
5. Take care of your newly re-engaged customers. Now that you have gained the attention of some of your inactive customers, it’s time to focus on their needs. Use different strategies to show them you are grateful for their time and business and always deliver a positive customer experience. Some companies use personalized postcards to thank clients for their business. Others use loyalty programs that accumulate points and offer rewards every time the customer makes a purchase.
Find out more about reviving inactive customers by contacting American Speedy Prinitng Marketing Print Mail. American Speedy Printing offers a variety of business services to help your company grow. Together we can establish strategies that support your business goals. Contact American Speedy Printing to discuss the options available to step up customer loyalty, retention, and re-engagement programs!
Joe is passionate about helping SMBs. He’s spent the last 30+ years building the American Speedy Printing Marketing • Print • Mail – and sharing best practices and marketing trends with his customers. Through research, in-person visits and this blog, he hopes to engage with and empower local business owners and marketing professionals.