In the competitive landscape of ecommerce, customer churn is an unavoidable reality as customer loyalty requires an incentive or reason to exist. Even the most successful brands see once loyal customers fade away – it's a natural part of the customer lifecycle. However, these lapsed customers represent a significant drain on your revenue and limit potential growth. Reacquiring them can be a challenge, but it's a far more cost-effective strategy than focusing solely on new customer acquisition.
This is where understanding your customer's behaviors, alongside personalized win-back campaigns and flows, can increase your customer lifetime value (LTV) and help build better, longer lasting relationships between your brand and customers.
Let's define win-back campaigns as targeted, strategic efforts to re-engage customers who haven't made a purchase in a significant amount of time (usually 3-6+ months in order for them to be classified as lapsed).
Think of them as a second chance to rekindle the relationship and bring those once-loyal customers back into the fold. The key to success here? Personalization. Generic blasts won't cut it. your approach has to show lapsed customers that you remember them, value their business, and genuinely want them back.
The following article covers how to define, identify and win-back lapsed customers for e-commerce brands.
While attracting new customers is crucial for ecommerce growth, neglecting lapsed customers leaves untapped revenue on the table. Before getting into how to win them back, it's essential to understand why they might have drifted away in the first place.
Here are some common reasons:
Feedback plays an essential role in helping figure out which of the above reasons apply to your customers. Direct surveys, analyzing past behavior (browsing patterns, purchase history) and reviewing existing feedback (positive and negative) all provide valuable insights that help you...
Tailor Re-Engagement: Craft win-back campaigns that directly address potential pain points and reignite a lapsed customer's interest.
Prevent Future Churn: Feedback data can reveal trends. Do many customers lapse after a particular time period? This could indicate a need to adjust your onboarding or retention strategies.
Improve Customer Experience: Analyzing negative and lapsed customer feedback pinpoints weaknesses in your brand's offerings or customer journey. This data allows for improvements that increase customer lifetime value (LTV) and reduce churn across the board.
A generic win-back campaign won't really cut it in today's competitive ecommerce landscape. To reignite interest and boost your customer lifetime value (LTV), personalization and making sure messages resonate is key.
Remember, lapsed customers need a valid reason to come back – show them that you understand their needs, value their past business and are genuinely interested in winning them back as loyal customers.
Targeting lapsed customers based on key data points lays the groundwork for highly effective hyper-personalized campaigns. The more detailed data you have on a customer and their journey with your brand, the more likely a message is to resonate on an individual and personal level.
Some useful segments here would be -
Go beyond basic greetings and generic offers to truly win back hearts (and wallets).
True hyper-personalization or however close you can get to it, across your outreach makes every lapsed customer feel understood and valued and gives them a genuine reason to come back.
Here are use-cases of hyper-personalization being implemented well -
Pro tip - Having a "brand ambassador" or someone from your team reach out, as an individual with their name in the email, will help a considerable amount in making your efforts seem genuine.
LTV.ai helps you achieve this exact personalization (location, previous feedback, personalized product recommendations, personalized coupons etc) across your email list to make customers feel valued and increase owned channel sales by 10-25%.
The next step for cutting through the noise and staying top-of-mind with lapsed customers is utilizing a multi-channel and multi-faceted approach that goes from Email to SMS and back.
Combining Email and SMS (especially with a brand ambassador or personal shopper on both) gives your brand more touch-points, enhancing trust and increasing the likelihood of your messages being seen and acted upon.
Here's how to approach an omni-channel strategy:
Personalized Email: This is your space for a comprehensive re-engagement effort. Capitalize on the hyper-personalization strategies outlined earlier:
Strategic SMS Follow-up: A few days after the email, send a short, impactful SMS to provide a gentle nudge. Keep the core message consistent with the email's offer, but tailor the language for the SMS format.
Here are some approaches to take for this SMS follow up -
The key here is to avoid repetition across email and SMS. Use both channels to create a conversation that draws them back in, showcasing your brand from different angles and maximizing opportunities for engagement.
Even without immediate action, this multi-touchpoint persistence reminds lapsed customers you're still there, building brand awareness that can pay off later.
Your win-back email subject line is crucial for grabbing attention in a crowded inbox. It needs to spark curiosity, urgency, and demonstrate the personalization within.
To get your creativity flowing, here are a few examples of subject lines in the context of winning back lapsed customers -
Demonstrate Genuine Care
When you put yourself in the mind of a lapsed customer, you'll learn that all you would need is to know that a brand truly cares about you, is concerned and wants to improve your experience. Even if this isn't enough to get you to convert, it will mostly be enough for you to reply.
The most efficient ways to show your brand genuinely cares are as follow -
A well-thought-out sequence that implements the strategies discussed is key to winning back lapsed customers.
We recommend running a dedicated win-back campaign on your lapsed customer for 4-6 weeks, with 2-3 emails per week. If a customer remains inactive after this period, consider removing them from your email list.
Here are a few example sequences to provide inspiration:
Sequence 1: Feedback-Driven
Sequence 2: Direct and Personalized
Throughout the campaign, send valuable follow-up emails with content related to past purchases (style guides, product care tips), or testimonials showcasing happy customers.
Important Note: Tailor the frequency of your sequence based on how long the customer has been lapsed. More recent lapses may require a faster cadence, while longer absences may need more space between emails.
Track the results of your win-back campaigns carefully, analyze open rates, clicks, conversions, and any feedback received. Use this data to refine your subject lines, email content, offers and the overall sequencing for even greater success over time.
LTV.ai runs hyper-personalized reactivation sequences on your lapsed customers, that change depending on each customers independent journey and lifecycle, to win back 1-5% of your entire lapsed customer list.
Reactivating lapsed customers is a vital strategy for ecommerce brands seeking to maximize customer lifetime value (LTV) and sustainable growth.
While customer churn happens, a strategic approach focused on understanding the reasons behind churn, segmenting your audience for targeted messaging, hyper-personalization and utilizing multi-touch campaigns is essential to bring these valuable customers back into the fold.
Remember, it's not just about regaining a sale; it's about rebuilding trust and fostering a lasting relationship with those who have shown an interest in your brand.
A leading menswear brand, Ministry of Supply, was having issues with the relevance of their emails and thus not being able to truly connect with and convert all of their customers, despite detailed segmentation and triggers.
To combat this, they tested out LTV.ai to see how the addition of AI into their marketing stack would impact their repurchases, customer loyalty, customer satisfaction and LTV. The results were better than expected...
The overarching goal was to re-engage customers that hadn't purchased in 180+ days but had made at least 1 purchase with the brand historically.
These lapsed customers were incredibly valued individuals that had been lost by Ministry of Supply and they wanted to show them they cared and wanted them back.
LTV.ai sent a sequence of 5 text-based emails from a "brand ambassador" dedicated to these lapsed customers, mentioning variables like their physical location and previous feedback and offering personalized product recommendations based on their previous purchases.
These emails also featured dynamic coupon code usage, meaning customers only got coupon codes if they were proving incredibly difficult to re-engage. When coupons were offered, they were hyper-personalized ("AMY15" for 15% off) and varying levels of discounting was testing for different customer segments (some got 10% off, while others got 25% off).
LTV.ai's AI also held conversations with customers over email, to nurture the relationship and help guide them towards the next purchase that would be perfect for that one individual.
LTV.ai's impact was impressive:
🟢 $0.91 revenue per unique lapsed customer
🟢 +9.93% conversion rate
🟢 11.59% of total brand revenue driven by LTV.ai
🟢 20x ROI
Apart from this, LTV.ai also:
🟣 Sent hyper-personalized text based emails, with personalized product recommendations, that customers loved
🟣 Held 100's of AI driven conversations over email to nurture customer purchases
🟣 Only offered coupon codes when necessary to maximize margins
🟣 Gathered tons of feedback directly from customers to stop future churn before it occurs