Losing customers can damage your revenue, stymie your business growth and demoralise your team. But if your CRM shows a steady trickle of lost customers with each passing month, don’t worry – you’re far from alone. In fact, a recent impact report from SugarCRM demonstrates that UK customers encounter an average customer churn rate of 33%. That’s a third of all your business, and a serious drain on revenues. If you’re serious about growing your business, you need to take active steps to win back customers who have lapsed.
The good news is that many of these lost customers are still lukewarm prospects and some will be ripe for conversion. A customer win-back strategy can supplement your efforts in customer acquisition and retention leading to stronger customer relations that form the foundations of sustainable growth.
Here, we’ll look at 7 strategies that can help your business to re-engage with lost customers without putting a huge dent in your profit margins.
1- Ask lost customers why they lapsed
When businesses lose customers, their top priority should be to identify the reason why they lapsed. Sugar CRM’s survey indicated that 74% of respondents left due to a negative customer service experience. But this is by no means the only reason why customers and businesses part ways. Customers may also lapse because:
They can get the same items cheaper from a competitor
They can get a more convenient or frictionless customer experience elsewhere
They perceive a decline in the standard of the products you offer
Your price point is no longer affordable for them
They perceive a lack of value for money
They disagree with or don’t know enough about your brand values
Of course, you’ll never know why customers lapsed until you ask them directly. Launch an email win-back campaign that offers customers a discount on their next order if they’d be willing to fill in a short form explaining why they left and what you could do to change their minds. Add a popup to your online store that activates when customers abandon their shopping cart at checkout asking them why they’re abandoning their purchase.
The more data you can get from the most reliable source, customers you’ve lost, the more equipped your business will be to demystify the problem of customer loss and implement a viable win-back strategy.
2- Offer an incentive to return
A coupon code or gift card attached to a win-back email campaign may be effective in soliciting a response. But it may not necessarily lure customers back for the long haul. So, what can you do to incentivise customers to return?
You can repair your relationship with customers by apologising for letting them down, owning any mistakes you have made and being as transparent as possible about the measures you’re putting into place to resolve their issues.
This may include additional customer service training for your team, changes to the products or services that you offer, or revisiting your customer experience and eliminating friction at and before the point of sale.
Showing customers that you care about and are prepared to address their needs can help them to feel valued and win back some of the goodwill that your brand may have lost.
3- Revisit your loyalty programme
A loyalty programme is not only a useful customer retention tool, but it can be a great way to win back customers who have lapsed. When making contact with lost customers, it may be worth inviting them to share their feedback on your loyalty programme.
Customers may not be aware of your loyalty programme, or may not feel that it gives them enough of what they value. Gamification of your loyalty programme can help you to increase engagement with it, while a broader range of offerings can ensure that customers that use it get more of what matters to them.
4- Revisit your customer personas
Many customers lose touch with brands because they feel as though their offering, branding and marketing are no longer relevant to them.
With this in mind, it may be worth revisiting your customer personas to make sure that your operations and offering are still aligned with the needs, anxieties and aspirations of your target market. Sometimes, businesses can become so subsumed by the realities of daily operations that they lose track of what matters to their target markets.
5- Create a more personalised user experience
According to Sugar’s report, 83% of marketing leaders attribute their high churn rates to a lack of communication and relevant messaging. This makes creating a personalised customer experience a top priority for businesses that want to win back lost customers.
There are many ways in which you can personalise your customer experience, especially if you are an e-commerce merchant. Successful strategies may include using behavioural targeting software to make personalised recommendations or using personalisation to generate unique offers and discount codes for customers based on their purchase history.
Personalisation can also open up excellent cross-selling opportunities while increasing your value proposition with unique bundle deals based on customers’ history and preferences.
6- Use content marketing to build rapport and add value to your brand
Building brand values can be a very effective way to win back lost customers. But there’s more to building brand value than offering discounts, cross-selling and upselling. Businesses need to look beyond the sale to see how they can support customers outside of their experiences with the brand.
Content marketing can be a very effective way to do this. If you want to build stronger relationships with your customers, creating your own content should be part of your marketing strategy. Blog posts, podcasts, white papers and ebooks are all great ways to establish your knowledge and authority while positioning your brand as a helpful resource. Just make sure that your content marketing strategy is aligned with the needs, goals and pain points of your customers.
7- Offer more flexible payment options
Finally, in these economically tumultuous times, your price point may be a reason for lost customers. That is not, however, to say that you should slash your prices in an attempt to win back customers. Instead, you may benefit from offering more flexible payment options like Buy Now Pay Later. Working with third parties like Clearpay can enable your customers to make purchases that they might otherwise have missed out on without paying interest on the purchase.