HAVE you ever heard of the “5x rule”? It costs five times more to acquire a new customer than to keep an existing one. While this legendary stat is timeworn, its sentiment still rings true. Recent research by Demandsage revealed that businesses lose 10 to 25 per cent of their customers annually. Yet, with proactive strategies, companies can keep up to 84 per cent of their customers, directly driving increased sales. And given that 65 per cent of revenue typically comes from existing customers, preventing churn is essential for financial stability.[1]

Ask yourself:

• How well do you truly know your customers?
• Have some fallen off your radar? If so, why and how can you win them back?

The first step towards sales growth is understanding customers’ spending habits, seasonal trends, and engagement patterns. Knowing when and why they disengage will empower you to re-engage them effectively and keep your business thriving. Read our two-part Sales Growth series [will also link to p2 here but can’t just yet] on how you can effectively re-engage with your lapsed customers and retain your current.

Identify Inactive Customers & Decide Who to Target

Start by reviewing your CRM or invoices to find customers who haven’t engaged with your business recently. Who hasn’t bought from you in the last year? Who hasn’t opened your emails or newsletters? Prioritise targeting those high-value lapsed customers, e.g. those who previously had the highest spend but have more recently declined. This could be through email, phone calls, or personalised messages, including time-limited offers to attract them back to spend with you again.

Discover Why Customers Left

It is crucial to understand why customers disengage to win them back. Was it due to changing needs, unsatisfactory service, or a company closure? Uncover why they left through direct outreach, customer surveys, or conversations. Use customer feedback to tailor your re-engagement strategies.

Run Re-engagement Campaigns

Tailored, customised experiences drive results – 60 per cent of consumers are more likely to return after a personalised interaction. To effectively reconnect with lapsed customers, combine multiple approaches for maximum impact.

To re-engage lapsed customers:

• Pick up the phone: Call your lapsed customers to re-establish the relationship. Share updates on new products, improvements, or offers that interest them. Use the conversation to confirm that your point of contact within the business is still correct, ensuring your efforts target the right decision-maker.
• Send customised emails: Follow up with tailored emails featuring relevant offers, updates, or news to keep the conversation alive and show you’re invested in their needs.
• Address past concerns: Highlight improvements to your products or services that resolve any earlier issues or barriers, showing that you’ve listened and adapted.
• Invite reconnection opportunities: Rebuild trust by inviting them to workshops, open days, or loyalty programmes, creating opportunities for meaningful engagement and fostering stronger relationships.

You can rebuild trust and encourage repeat business by proving your worth and addressing their needs.

Practical Tips & Actions

• Segment Your Audience: Divide customers by behaviour or engagement level to deliver targeted messages.
• Offer Incentives: Use discounts, special offers, or exclusive deals to encourage spending.
• Leverage Automation: Use tools to send timely, relevant communications based on customer actions.
• Ask for Feedback: Regularly seek customer insights to refine your approach and improve satisfaction.
• Track Metrics: Monitor retention rates, customer churn, and re-engagement success to measure impact.

Check out part two of our series, where we discuss strategies to retain your current customers. We discuss how you can keep your data accurate and up-to-date, targeted communications you can develop suitable for your customer base, as well as how you can continuously nurture long-term relationships.

[Copyright © 2024 Angela Kunawicz & Blueberry Marketing Solutions. All rights reserved.]

[1] Customer churn is the percentage of customers who stopped using your company’s product or service during a specific period. It’s a key metric in customer retention, as reducing churn can significantly affect your business’s bottom line.