Today, when businesses are facing the heat of increased competition, rising advertising costs, and marketing strategies becoming obsolete even before hitting the floor, it really makes sense to invest in dormant leads than to look for new. Customer retention is the most pragmatic investment that a company can make. Depending on which industry you are in, acquiring a new customer is anywhere from 5 to 25 times more expensive than remarketing an already acquired one.
You have already spent a considerable amount of time and resources in getting leads, you would not want to do it all over again. Considering research done by Frederick Reichheld, increasing customer retention rate by a mere 5%, can proliferate the profits of a business by 25 to 95%. Although it is always recommended to capture more of the market however, once you have already subjected your business to the trouble of gaining a new customer, it is advisable to cherish them first.
Dormancy of a customer can be for a number of reasons, and it does not always translate into your business being considered uncompetitive by them. It is a misconception in the business world that only strict business language should be followed by negotiating a deal with a client. Empathy work wonders when everything else is failing!
Try to know what put them off and how it can be reversed. Giving a personal touch to your communications might help in reviving the lost treasure.
The established businesses already have an inside-sales and marketing team, which shoulders the responsibility of customer retention. However, small businesses are more often stuck in the whole process of customer retention, and why not? This is just their starting.
Thus, we have mentioned some plain-sailing tips for small businesses on how to target dormant customers.
Identifying a dormant customer is an intricate task. If you are not aware of your businesses’ average purchase frequency, you might end up wrong targeting them. There are two types of customers – who purchase frequently and the ones who purchase in varying intervals. The past data might be able to help you figure out your dormant customers.
Why did they leave?
Once the identification is done, get to know why they left.
The ‘why’ of their dormancy will help you devise ‘how’ of your remarketing strategy.
- Did your pricing turn them away?
- A bad or poor quality service?
- Or they need a more personalised touch?
Once you have the database and their reason to turn dormant, it should be an easy affair to hit the right spot. Do not over market your services, as many businesses do. Personalisation of your services, is what past studies have revealed, work best in this scenario. Offering them something, which you do not usually offer to everyone will certainly make a profound impact. After all, it is all about going the extra mile to retain them.