Blowing Up Your Dormant Database
Look, inviting people to the party and getting them to show up is the hard part, but getting them to stick around and "drink" is another activity altogether. Standard reactions such as offering tons of coupons and discounts will work to reactivate a percentage of customers but certainly not all.
Retracing how you got them to the party in the first place all the way to last time they crossed your doorstep can say a lot about why they may have disengaged. If you aren't looking at this data, you may be missing critical clues. Provoking them to get off square one and get re-energized means digging deeper to understand who/where they are and chiefly what they care about (and don't care about as the case may be).
Got a database? Well I say, "Hook up the C-4 and let's blow it up!"
If you ever studied architectural demolition or controlled explosives, you know the shrapnel and particles that fall out from the structure are akin to the "DNA" of a building. From the kind of cement to the depth of the rebar, those "guts" of the building are quite telling of its history. The "guts" of your data (upon explosion, of course) are no different and likely tell you a few things. In those particles you see demographic data, purchase frequency and pattern formation of engagement, AOV (Average Order Value), LIV (Line Item Value), self-segmentation of interests (as available), opt-in status and other ad hoc info.
So now what?
You should view this "shrapnel" of data nuggets as a way to look at your database in a mathematical and analytical way. (Close your eyes and repeat after me, "There's no place like a spreadsheet, there's no place like a spreadsheet ...")
This very co-dependent and cogent style of reactivation development allows the work and the "math" of the data and detail to tell the story through analytical theory as well as offering a critical eye to significant and statistical patterns.
The most important step in Reactivation is, naturally, the work that must happen first. You need to put on the anthropologist's gear and dig deep into your database looking for specific data and patterns. You should break out your segmentation into a few select theorems of study:
- Profile Differentiation
- Choices by Consumer
- Time Between Purchases
The next step is plotting customer information into a mathematical equation based upon attributes. We use our 9-box Quantitative Matrix of Customer Value/Attributes by which we apply formulaic scoring consisting of customer frequency, customer value and attain a very objective and value-driven view of activation.
Lastly, you should create validated segments utilizing supporting evidence and other analytical factors to make a very comprehensive segmentation plan.
By applying predictive scores to dormant customer files before fielding a reactivation campaign, you can prioritize toward greatest likelihood of response -- not just "who" but "how."
However, knowing exactly "what" to say to these different groups of customers is paramount.
In many cases the message you send a lapsed customer is just as important as the segmentation work that is done to find them. As you know more about your customers you devise a plan that will reach out to them in a method that they will respond to.
Personalization is a significant component to the messaging process as well as a potential lynchpin to success. A formulaic approach to understanding value and spend in relation to reactivation is to determine what value you place upon the customer. For example, if a lapsed customer is potentially worth $100 in average order value and you want to send a compelling offer, how much should you spend to push out that message and over what kind of time frame to covert? We use a simple formula to calculate the complex value per push based upon the total value of the list and the incremental revenue they represent.
Treating your lapsed customer in the same segmented way you care for your active customer is a key activity to make the most of your reactivation budget.
Additionally, going in the other direction, you need customer purge guidelines. In other words, how patient are you? How long do you give a "nudged" customer for reactivation? At what point do you finally purge them out? Lastly, at what benchmark financially do you "give up" on reactivating that consumer?
Now what channels will you use (should you use) to get in front of them? You need to come up with a comprehensive strategy that will incorporate marketing levers and content strategies to maximize your particular audience utilizing their needs and behaviors. Creating an encompassing display media and social media strategy along with outbound communication and search is just one of hundreds of combinations you should be considering.
The excavation of yesterday's dormant customer can become today's active customer by simply investing the time and attention (and the right strategy, of course) to the effort. Think of it this way: A building can implode in just moments but what is reconstructed in its place can be of greater value and can last a lifetime.
"You just gotta' ignite the light, and let it shine ..."