Alternative Marketing Strategies For Customer Retention And Reactivation

While companies look for new strategies to compete with other brands, many forget existing strategies that have a positive impact on sales and marketing. Though customer acquisition is important, retention and reactivation can help broaden the customer base majorly. Retaining existing customers is a much cheaper option than acquiring new ones. Market research has shown that it costs close to 6-7 times more to acquire a new customer than it takes to retain existing customers or reactivate dormant ones.

Most businesses target customers through emails, but many have not tapped into a valuable tool available in the market – the SMS. According to the Annual State of Marketing Report 2017 by Salesforce, 68% of businesses use mobile campaigns, whereas 20% plan to use it in the next two years. However, on the consumer end, statistics show that in 2017, 37 million customers had chosen to receive marketing SMSes. It is predicted that by 2020, 49 million customers will opt in for SMS marketing.

SMS falls under the top 4 most-adopted tactics of mobile marketing. This medium of mobile marketing is an easy method to engage existing customers and keep them coming back for more.

Customer engagement

While many businesses use email to engage their customers, much of it gets lost among spam and tons of other content-heavy emails. SMS is a much easier method of sending out only the relevant information needed to inform the customer of new offerings, discounts and sales. SMSes can bear the link required to help direct the customer to the targeted page.

Reaching the Masses

All mobile phones are equipped to receive SMSes, whether it is a smartphone or not, and whether it has a data plan on not. Mobile users don’t need to download any application either. This becomes especially valuable in developing countries where a large base does not have data packs or smartphones.

Increased Level of Read Messages

While many emails go unread, many advertisement banners go unnoticed and many pop-ups are ignored, SMSes have a high read and response rate. The SMS open rate stands at 98% whereas response rates are at 45%, according to various reports. Emails see only about 20% open and 6% response rates. The reason can be attributed to the high volume of emails one receives nowadays.

Reactivating Dormant Customers

Customers become dormant for various reasons. While for some customers, it might be a personal reason, for others, it could be purely business related; meaning that the firms approached might have been asked.

• Analyze and Segregate – Organising and cleaning up data is a consequential step in the process of reactivating customers. Once dormant customers are segregated, one needs to understand why customers left, what went wrong, and how to fix it.
• Reach out – Calling customers to come back is the simplest way to reactivate a customer. A simple SMS saying, “We miss you. Enjoy 20% off on your purchase” can jolt life back into the customer’s journey. Ensure that customers can respond quickly and easily. It’s key to include a sense of urgency by including “Limited Offer” or “Expires on…”

Considerations

For SMS marketing to be successful, one needs to carefully consider the limitations and drawbacks of the channel. Like any other channel, SMS is not free of flaws. If not used correctly, campaigns can fail to deliver the expected results.

• Marketers must take into consideration the cost per message, as this is usually higher than email campaigns. This is because mobile operators will charge a premium for using their services. When used aptly, the cost of the channel will be negated by the results of the campaign.
• Furthermore, SMS campaigns must also follow consumer privacy best practices. A company that uses this medium must provide simple opt-in and opt-out processes. Once a customer has provided personal contact information while making a purchase, it shouldn’t be misused by spamming them. Instead, tactful ways should be used to keep the customer engaged.
• In addition to all this, the focus should be on important information that provides value to the customer at the right time and allows them to take action on the ones they are interested in.

It is essential to keep SMS strategies dynamic to adapt to the different stages of a customer’s journey and to evolve as the market evolves.