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If you want to discover the awesome possibilities of customer reactivation, you have come to the right place!
That’s because in this article we are going to explain how to reactivate past customers that haven’t bought in a while, and give you helpful examples and proven strategies to help you win back customers.
What is customer reactivation?
Customer reactivation is a form of marketing that engages customers to purchase again. For a variety of reasons, an inactive customer is someone who has not purchased from you in a given time frame, often times 1 year or more. A customer reactivation marketing strategy can (re)inspire a buying decision.
So what exactly is customer reactivation and how do you do it?
That’s exactly what we are going to explore in this article.
Let’s get started!
Dictionary.com defines reactivation as; “bring back,” “induce,” and “reawaken.”
In a business sense, this action aims at winning back the loyalty of someone who used to be a customer.
But what does reactivation really mean?
Reactivation means you are re-engaging a customer who has not made a purchase in a while to come back to your place of business, your store, your website or wherever you conduct transactions.
In most cases, this means you want to reactivate a buying habit with this customer, to come back to doing business with you.
For example, maybe you own a restaurant and the customer saw other people who were seated long afterwards but still received their food before the customer who was seated first.
This upset the customer and they decided not to come back.
Again, this upset the customer and they decided not to come back.
For a very insightful, fairly famous article on this topic, you are encouraged to visit:
I’m the Nice Customer … Who is Never Coming Back …
Anyway, whatever the reason, and regardless of the typical and sometimes unique buying cycle that is unique to your industry, the customer once was a regular buyer, and now hasn’t returned in a given time frame.
This means the customer has become inactive and your business needs to implement a customer reactivation strategy.
As we go deeper into how to fix this, it is worth your time to review why customers become inactive as outlined in this helpful article:
6 Reasons Why Customers Stop Buying
In business, customer reactivation focuses on nudging dormant customers to resume product or service purchases.
Sounds like a simple marketing campaign, doesn’t it?
Well, it's not always easy.
Remember, each customer has a different reason for why they have not come back. Maybe they are upset with your service, maybe a bad product, maybe they have no money left, they may have found a better deal elsewhere or maybe they moved.
For optimal conversion rates, your customer reactivation strategies should take a somewhat personalized approach. And sometimes this takes time to find the right message.
Fortunately, and depending upon the size of inactive customers, there are many wonderful technologies available to you today that can help.
Generally, the most popular customer reactivation strategies use at least 1 of these forms of communication:
But how do you choose which form of marketing communication to use?
As a general rule, and for highest conversion rates, use the communication that the customer is most comfortable using.
This is where modern marketing tools are tremendously helpful. For a growing list of some of the best marketing tools every marketing pro should be aware of, visit:
What Are the Best Marketing Tools?
One of the first tools that will be your go-to for this strategy is a simple Excel or Google Sheets document to review your customer data.
At this phase, it is extremely helpful if you have reviewed this tutorial:
Recency, frequency, money | RFM analysis
The purpose of the RFM analysis is to properly segment your customer list.
And that is what this first business analytics and marketing metrics lesson is all about.
Assuming you have a customer list, here’s a very simple way to start. Here’s what you do:
If you do not have a customer list as is the case with many brick ‘n mortar businesses and retail shops, you need to start one immediately. In the meantime, you can still use the core message in this article to win back customers with a little creativity.
To make this far, far easier on yourself, it is highly suggested that you first clean up your customer list.
Here is a suggestion on how to do this.
Here is a starting point and how you should manage your customer list at all times. It is normal to update your regularly. At a minimum, update your list once a month or once a quarter, if it's not already automated as a result of your eCommerce solution or CRM.
Break your customer list into these 4 segments:
This is a super simple basic structure to help you get started and stay on top of your customer segmentation and reactivation strategy.
Let’s now get into some real-world actual examples of customer reactivation marketing campaigns. These are real campaigns that we have recently done so you can model them for your needs.
Let’s now run through three simple reactivation campaign examples.
To start, here is a recent campaign focused purely on customers that have not ordered in over 1 year.
This example is from a very successful online seller in the wellness industry.
Here’s what we did:
For all the details on this customer reactivation campaign and a template for you to follow, you are encouraged to visit this helpful article:
This Common Marketing Mistake Could Be Costing You Millions
Important note: If you are looking to reactivate the most numbers of inactives and increase lead flow in order to fill your sales pipeline, figure out how to use the word “Free” in your offer. For some helpful examples on how to do this, visit:
How is “Free” used in marketing? (5 clever strategies)
The next customer reactivation campaign example is for a company in the food business. This campaign simply went to all customers who have not purchased in more than 365 days.
We sorted all the customers in the database and found all the people who have not bought in more than 1 year.
This left us with a considerable number because the company does a high volume of lower priced transactions (< $50) in a highly competitive niche.
Here are some basic expectations:
Let’s do one last example for a service-based model with far less numbers in the database.
It is very normal for a service-based business to have less than 1,000 customers in the database. This is especially true for larger price points, “high frequency” of service and if the business has less than 5 years of history.
So, the customer database for a service-based business model may break down like this:
So, your customer reactivation strategy will focus on the 550 past customers who have not purchased recently.
Because 550 is a lot to manage for a company that is probably a small service-based business, you would want to carefully review the list to define your reactivation strategy.
You will want to segment this list into the most recent buyers (1-2 years, 2-3 years, etc), buyers who spent the most money with you, and buyers who did the most transactions with you.
In this case, it makes sense to do a combination of phone, email and direct mail.
For example, here a real world, sample customer reactivation marketing plan:
If you run a landscaping business you could visit the old addresses with some marketing materials and a media kit and (re)build some rapport. They may be different people that live there as your past customer may have moved, but this represents a wonderful bridge to re-activate a relationship or create a new one.
Additionally, you could call the most recent past buyers and tell them you’d love to do a free consultation to review their property to see if there are any maintenance issues that need to be taken care of.
These two strategies are extremely easy and can be used in basically every service- based model.
These are just simple strategies to get you thinking. But this is what works and our marketers do every day.
In fact, if you are looking for a fantastic career opportunity you could literally make a wonderful career out of specializing in developing customer reactivation strategies. For more information on exactly how to do this and more, you are encouraged to go here.