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Reactivate lapsed customers

Implementing a strategy to re-recruit previous customers is almost always a highly cost effective exercise because conversion rates are usually comparatively high (in comparison to rates for recruiting cold prospects).

This is often because:

  1. The lapsed customer has simply forgotten about your business, or
  2. Their new supplier isn't as good as they were hoping.


Understand why they left you in the first place

This study by RightNow Technologies shows that 73% of customers leave because of poor customer service.

A study by the Rockefeller Corporation found that 68% of customers left simply because they felt that the company didn't care much about them.

So how do you win them back?.

  1. Carry out a customer service feedback survey, find out why they stopped buying and assess their future needs.

  2. Decide where you should focus your time and budget.
    • Are all lapsed customers the same? Or does your segmentation indicate that some are worth more focus and investment than others?

      For example, which have the characteristics of your most profitable customers?

      Define the audience that you plan to target.

    • Is a new product/service more beneficial to a particular group?

      There is usually data to differentiate the best prospects among enquirers and lapsers from the worst. These are the ones to re-solicit.

  3. What could tempt customers back?.
    • Test different offers/incentives and propositions that may be particularly relevant.
    • Offer a financial incentive (usually a % discount) specifically for past customers (and include a time limit).
    • Contact them when you have a new service to offer them.
    • Use the seasonal calendar to create promotions; Christmas, Easter, Back to school etc and communicate these to lapsed customers.
    • Examine their purchase history – recommend another of your products or services that is relevant to their last purchase.

      Don’t bombard them with offers. 

    • Think about where you should focus your efforts.

      For example a weekly email to a person that bought something from you a year ago is more likely to annoy than win them back.

    • Try to stimulate dialogue.

      Try to identify what customer services missed. With a dialogue in place you may be able to tempt them back with new offers or better services, or at the very least, improve the situation for your existing customers.

  4. Be honest with them.

    Tell them that you're aware that they haven't bought for a while and that you'd like them to come back.

  5. When do you stop trying?
    • Analyse the reactivation campaign results to determine when to divert budget to more responsive prospects.

  6. For larger clients implement a Customer Exit Management programme.

    Very often when a customer moves to a competitor they quickly become dissatisfied.

    A good Customer Exit Management programme should bring them back.