Do Re-engagement Campaigns Pay Off?

It happens to all of us. A significant part of our list does not open our e-mail marketing messages. Whether it’s 50 percent or 80 percent of your list, non-responders are a reality of our business. Yet, most e-mail marketing experts never publicly share strategies or thoughts on how to re-activate these non-responders. Sometimes I wonder why.

In my day job, I’m faced with significant revenue goals for two different companies. While the revenue I receive from my best customers (and highest e-mail responders) is great, it isn’t enough. Often times, vendors bombard me with pitches to look outside of my list to try to acquire new customers. I ignore these calls 90 percent of the time. After all, I’ve been brought up to believe that it costs much more to lure a new customer to share their most personal information with me and opt in to my messaging than it does to re-engage a customer who, at one time, believed my brands offered something of value. Doesn’t it?

After years of being a die-hard fan of re-engagement, I took a deeper look into the time and cost associated with re-engaging a non-responder vs. acquiring a new customer. It was a great eye opener.

Here’s what I did:

I started out by looking at base costs. At one of my companies, we e-mail people who have opted in to a newsletter once a week. Including the management time, creative design time, and deployment costs, this effort costs me $1.33 per customer message per week.

If 30 percent of my list never responds to my e-mails, this means I’ m spending over $100,000 per year on people who are no longer interested in what I have to say. Could that $100,000 be better spent if it is redirected to list growth efforts? After all, isn’t it true that 30 percent of all of our lists go bad each year anyway?

Then, I looked at the results of re-engagement efforts. Here, I came up short. It seemed that no matter what I tried, birthday e-mails, special offers, re-engagement surveys, etc., my results were hitting such a small percentage of my list the return wasn’t there.

From the looks of it, re-engagement of non-responders seemed like a lost cause. Then I looked at investing the same amount of money into new growth efforts. Just like a diet, I discovered there’ s no miracle program. (This shouldn’t be news to you.) Instead, I found that I could lose my money faster than I could turn around if I wasn’t careful. For sure, the rate of quality growth did not match the rate of loss.

So, what should a smart e-mail marketer do? The answer lies in the original prospecting of the name and the profiling associated with it. Instead of looking for fast and large list growth or costly re-engagement strategies, focus on the first 90 days of messaging. If your customer doesn’t actively respond to your e-mails on a consistent basis over the first three messages, or the first 90 days, she’s likely showing signs of being a non-responsive customer and should be placed on your risk list.

Turns out the smartest investment lies in making your on-boarding process as strong as possible. It could be the best way to re-engage a customer before she even knows she needs it.