Making Your Customer Base Active

“The single most important thing to remember about any enterprise is that there are no results inside its walls. The result of a business is a satisfied customer.” – Peter Drucker

If you don’t have a satisfied customer base you can be sure that you will need to spend loads of resources trying to acquire new ones, since your current customers will leave. Anyone in business has probably learnt, the hard way sometimes, that it is 6 to 7 times costlier to acquire new customers. You might as well keep your current customer base active – engaged and interested.  Irrespective of size, no company can afford to lose customers given the tight margins, furiously competitive market and continually rising costs.

The rise of multiple communication channels has only added to the strain. Every company has to now compete with their many competitors over a larger spectrum and leaving out or being inactive on even one channel could make this struggle harder. Omni-channel communication has made it tougher for companies to attract and sustain the interest of the current customer base that exists and also potential ones. The toil and mêlée does not end with just attracting the attention of the customers – it takes as much effort and time, to keep the customer base active through emotional bonds and engaging experiences. Missing out or leaving it idle for even a short time and the negative effects will immediately be perceivable.

Companies must not only focus on acquiring new business, it is important yes, but must put concerted effort into keep the current customer base active and happy, thereby creating loyalty and profitability over time. It is not comprehensible as to why companies would let their customer base become inactive by ignoring them. Research has revealed that customer churn could be as high as 50% if the customer base is allowed to remain inactive for a period of 5 years and worse still is that there are some companies who have let this happen. The losses equal millions of customers and as much in lost profits and earnings.

Isn’t it shocking then that companies still are not doing enough to keep their customer base active or at least looking at reactivating the dormant ones. Such companies would do well to pick up on cues and actions of companies that are adept in keeping their customer base active and re-activating customers that became dormant or went away for some reason. These actions must become a priority for companies to sustain their growth and profits. Given the volatility of the market, it is no surprise that companies are wary of investing in an exercise of making the dormant customer base active again. It is seen as high-risk that may not yield results and they would much rather spend on acquiring a new customer base. Ignoring the reactivation of a customer base can prove to be highly detrimental for any business. Research says that even a cautious estimate of the chances of success with ‘reactivated’ customers is around 50% more than in trying to gain new customers.

We discussed that companies can gain from accessing, analysing and using customer data. Customer information is an invaluable asset for companies. Through this data companies can understand how to keep their current customer base active and also analyse why some customers have become dormant. Using the current information they would be able to formulate strategies, methods of communication and the approach to use with both sets of customers. The data will provide valuable insights into both current and past behaviour and customer activity, thereby making it simpler for companies to put in place the most appropriate communication content.

While making attempts to reach out to dormant customers, companies need the customer data to determine which customer base they should target in terms of a higher possibility of conversion. It makes sense – since there will be considerable effort, time and money required and as mentioned the death grip of the market – increasing competition and decreasing profit margins – ensures that companies take calculated risks that would have a higher possibility of increasing the ROI.

Along with keeping the current customer base active, it is necessary to dig deep and reactivate dormant customers and the data available allows this to be possible. However, rather than immediately acting on this data and beginning to target ‘seemingly’ profitable customers, companies must first reach out to a handful of customers only. Based on the experiences of this ‘test’ companies can tweak their methodology to ensure better results when launching a full-blown campaign to regain customers. It will be important to follow the same pattern of communication with each individual dormant customer – and this is where ‘historical’ data comes handy.

Whatever channel and method a company uses to keep its customer base active and also to reconnect with customers ‘who went away’ or are inactive, the result should be a positive impact on the bottom-line. Companies that can smartly and continually leverage all the communication channels now at their disposal will be able to have greater reach to keep their current customer base active and also be able to reactivate the dormant ones. The situation is scary and shaky and it is up to companies to pro-actively protect their customer base and keep away the ever-hungry competitors just lying in wait to grab what companies neglect even for a short period of time.

It may seem tedious and painstaking to continually focus on keeping the customer base active and also ‘reawakening’ the dormant customer base but undertaking both these tasks is vital to the success of any company, irrespective of size, stature and history. Companies can use ‘historical’ data for customers relating to transactions, buying behaviours and patterns to understand how to keep them active and also what made some of them become inactive to start with.

Segment both the groups and use a part of each group to test the methods you would like to put in place for achieving both the goals. Ensure that you can determine the customers preferences, the kind of offers that interest or interested them, the channel of communication they prefer to use and whether trying to reactivate a certain customer or segment is required. The fact is that the customers may have become dormant either because your company’s products and offerings no longer matched their needs or as a company the customer moved to a different field of operation and hence their requirements changed. The product your company sells might also have something to do with dormant customers – for example if you sell cars, it is unlikely that one customer will make too many repeat purchases often, whereas if you sell photocopy paper and you have a shrinking active customer base, then you would need to address the problem.

When trying to keep your customer base active or reactivating the ‘quiet ones’, the communication your company sends out must be relevant, engaging and memorable. While this is true of all communication, it needs even more care and focus when getting customers to pay attention and remain with you or come back to doing business with you. The process requires patience and diligence given that customers may not immediately respond to communication given their business preoccupation and or their lack of interest if they have become dormant. The companies that give up soon, are most definitely losing out on business and practically handing over extra revenue to their competition. Reach out to both your active customer base and dormant customer base and establish or re-establish a relationship that is mutually beneficial and valuable to you and them.

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