The Cost of Pride
Often, companies don't make win-back campaigns a priority because of pride. To make it successful requires an organization to really listen to customers' feedback, which for many is completely unpleasant. It may in some cases mean having to admit being wrong or possibly even apologizing. At some point, you might be put in a position where you need to humbly ask for another chance. In fact, the whole idea of going back and digging up a virtual graveyard full of ex-customers looking for a possible pulse might just seem a bit lame and unglamorous. It may test your pride. More accurately, it may test your ability to swallow it. America's business legends rarely got to the top on a diet of swallowed pride but, then again, they probably had a gentler market and an easier product to sell. If you can get past this silliness about pride, I can give you a reason to take up the tools of a gravedigger.
Compelling Reasons To Act
There is a critical and compelling fact that must be shared in order to more successfully prove that lost customers are not all dead opportunities. Too often, companies simply assume that the reasons customers defect are beyond their control and, therefore, it is impossible to attract the customer's business again. However, studies have consistently shown that up to 70 percent of deserting customers have no special, identifiable reason for leaving, and many may be willing to return if simply asked for their business again.
I repeat: Up to 70 percent of your inactive customers may have no special reason for leaving your world and it might only take a simple invitation, with no other change or investment, to turn them into an active customer once more. If you're not certain, that kind of knowledge is called a "compelling reason to act."
Who Is Worth Revisiting?
As you begin to sort through the customer database trying to pinpoint who your zero customers are, you'll need guidelines for categorization. You may find success with the following method.
First, perform a sweep to eliminate those zero sales customers who are not at all worth revisiting. If you couldn't make them happy before with your very best sales, service and pricing efforts, you aren't going to make them happy now. This time you walk away. Also remove the slow-payers and those with special circumstances that kept you from making a profit on your transactions. Next, consider breaking those that remain into degrees of difficulty (12 months without a sale, 24 months without a sale, etc.). Each grouping may receive variations on one central promotional program.
Requalify And Reconnect
When you reconnect, you will need to do it with true enthusiasm. Avoid uninspired form letters or anything that appears to be second rate. If possible, reach out in a truly unique fashion. Reconnect with a distinct and exciting purpose, done in such a way as to demonstrate the value they'll feel when your relationship is restored.
Any of the following could be a reason to connect or the basis of a well-designed win-back campaign:
• Announce a new pricing system.
• Show off a new display policy.
• Introduce new products or services, and try using cross-selling/upselling techniques.
• Survey inactive customers' opinion. (Isn't this the group to ask about your performance anyway?)
• Invite them to a spectacular event.
• Offer them something special and unique that will bind you together.
Inactive Customers Can Turn Golden
Re-engaging inactive customers through a concentrated win-back campaigns allows you to optimize the investment you made earlier in the customer life cycle. (You are not starting completely from scratch). As subtle cost savings kick-in each progressive year, customers can become more profitable over time, even if your margins are unchanged. Long-time customers tend to refer you more as goodwill is restored and often increased. As comfort levels increase between supplier and customer, you enjoy greater efficiency in both selling and servicing the account. With more time together, customers tend to chase less price discount possibilities. Profits can climb and customers can turn golden if you re-ignite inactive customers at the base profit margins you previously enjoyed.