Reactivation Campaigns: Reviving Your Long-Lost Customers

Over the past two years, I’ve written a lot about customer acquisition and retention, focusing on customer experience, customer service, and personalization. Today I’d like to cover customer reactivation.

I got an email message from MY UPS.COM (a site I’d written about last year as a good “my” site). It’s obviously aimed at customer reactivation, but it makes every mistake imaginable. Let me explain…

Rule No. 1: Never Let Users Expire

Why would you ever let your users “expire”? The only possible reasons I can think of are technical: Your database has so many users (and so many dead users) they are slowing up the system or taking up too much space. Let’s think about these two possibilities.

If your database is full of mostly dormant users, you are doing something drastically wrong. Your worries should not center on how much space these users are taking up but why your company’s services and products are failing to prove useful to most of your clients. Figure that out, as it is a more pressing problem than what do to with all those dormant names.

If your dormant users are taking up too much space in your database, talk to your technical folks. I wish I could be a fly on the wall when you ask you technical team, “Why doesn’t our database scale large enough to accommodate a large user base, active or not?”

If you are a small to midsize company, you should be building out your technology to handle two to three times your expected load. The whole point is to grow your business, right? You should never reach “capacity.” If you do and can’t afford to add more technology to handle more users, revisit your business plan. A business strategy in which you lose money when you add more users is not (in my humble opinion) a good one.

Rule No. 2: Remind Users Why They Liked Your Products

There is one undeniable fact about all the dormant users in your database: At one point they signed up and were interested. Maybe their needs have changed and they no longer need your services, but I am sure they still have needs. Maybe they aren’t aware of your other services (that might fill their current needs). Or maybe they’ve simply forgotten about you.

Use whatever knowledge you have about them (their previous transactions, their customer segment, etc.) to craft an email that addresses their needs. Remind users who you are and what your value proposition is. Remind them why they used to look to your company, and tell them why they should look again. The more personalized this email can be, the better.

Remember peoples’ needs change. Don’t make the email so personalized and narrowly focused you address only what they used to do with your company. Their needs have probably changed, and you must consider that. Take a look at what they used to do, and see if you can make any guesses about what they would need now. Financial institutions spend a lot of time figuring out a customer’s changing needs over a lifetime. Do you?

Rule No. 3: Encourage a Dialogue

In a previous ClickZ column, I said email is a dialogue, not just a one-way communication. You should always encourage users to talk with you. A lot of knowledge can be gained from talking with your dormant users. Sending out a survey (that some of your dormant users might answer) will help you find out several important things: Why they originally signed up, what made them stop using you, who they use now, what their current needs are, and so on.

A simple survey might help unlock some important knowledge about your customers’ needs — the needs you aren’t serving well. It could be your user experience is so bad you are simply alienating the customers who want to use your company but are frustrated trying. Find out by asking them!

To encourage a conversation, never send an email message with “do not reply” as a return address. Always give users a way to talk to you. Users get very turned off at the idea of “I can talk to you, but please don’t talk to me!” If you are dealing with dormant users, you should be thrilled to hear from them no matter what.

A Worst-Case Example

Now that I have addressed three best practices for customer reactivation, let’s look at a company that got it completely wrong — MY UPS. (Apple did something similar after I bought an iPod.) Here is the email I received, unedited (except for the dashes I used to replace my username):

Due to inactivity, your MY UPS.COM User ID — is set to expire on Wednesday, July 02, 2003. To keep your registration active, please log in to prior to this expiration date.

If you have forgotten your password please go to the MY UPS.COM forgot password page to reset it.

This is a system generated email, please do not reply.

This email breaks every rule I just explained. Guess who won’t be reactivating an account? MY UPS.COM’s reactivation campaign isn’t really a reactivation campaign at all. It’s merely a note saying, “So long. Have a nice life.”

What Works for You?

Is customer reactivation a problem for your company? Have you found good techniques for reactivating customers? Send feedback for this column with your top reactivation strategies.

Until next time…


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