Viden
//Monday d. 26.11.18

Guide: How to get started with your customer win-back strategy

Share article

Written by Peter Jakobsen

Increasing the number of subscribers is an essential part of running a subscription business. As sales increase, sales costs also tend to become sky-high. Therefore, it can become necessary to find alternatives to classic sales activities.

In the media industry, it has been the publishers’ sales strategy, for decades, to contact former customers in order to “win” them back. This activity is called a win-back activity or strategy.

In fact, about 60% of the retraction of customers is due to win-back, which means that the industry (hypothetically) would be dying, if it wasn’t for the win-back activities.

Besides being both a more effective and a cheaper method than attracting new customers, customers from win-back activities tend to have a longer average lifetime-value, which creates a strong foundation for a sustainable sales activity.

The purpose with the following guide is to demonstrate that by using four data points only, you will be able to develop an effective win-back campaign. You can get started with the campaign in a just few hours, and it will be on-going effort in creating value for your business.

 

Customer Win-Back is the 6th element in the subscription model from the book “How to build a subscription business”. The book is written by Subscrybe’s CEO, Morten Suhr Hansen, and can be downloaded for free, here.

Segmenting win-back customers

In a digital everyday-life, we have access to all sorts of data points. These data provide insight that we have never dreamt of before. They allow everyone to create tailored “one-to-one communication”. However, as a result, consumers often become incapable of making a decision – they simply have too many options in purchasing situations.

We tend to overcomplicate segmentation, communication and campaigns, which implies that development of these types of campaigns will take too long and we don’t make it in time.

If you are a world champion in segmentation and practical use of data already, the following will seem a bit trivial.
However, if you are in the starting phase, it would most likely provide a good starting point for optimising your sales strategy.

The four data points
To begin with, it is necessary to find the data points, which create the foundation for the segmentation:

  1. Which contact information and permission do you have on the customer? (Mail, SMS, telephone etc.)
  2. When did the customer relationship end?
  3. How long was the customer active?
  4. Which products (subscriptions) did the customer have, when they cancelled their subscription?

When you find the data, you need to define what we call ‘segments’. These will make it easier for you to optimise your communication.

Start with some clear definitions:

  • When can you define a customer as a win-back customer? For instance, you can determine that 24 months after cancelling their subscription, the customer must be treated as a new customer, since the relationship has expired. However, it is important to bear in mind that there are laws regarding storage of customer data, which must be respected.
  • How rapidly will you contact the customer? Does it make sense to make contact already after one week? Perhaps, perhaps not. Consider this in relation to your general knowledge of your business.
  • How often will you contact the customer? It is important that the customer doesn’t experience the contact as spam.
  • Decide how often you want to contact the customer, so it doesn’t end up being annoying.

After this, it is time to divide your former customers into “win-back segments”. By doing this, you become even better at targeting your communication. In addition, you can prepare for possible challenges that may arise in the dialogue with the customer.

Use the following as a starting point:

  • Time since cancelling the subscription (e.g. 3, 6, 9, 12 months)
  • Time as customer (e.g. trial only, less than a year, more than a year)
  • Product group (e.g. basic, medium or large package)

Notice: In some business models, it would be more obvious to use revenue, profit or similar as basis for prioritising. In that case, it could also be a parameter in the abovementioned.
In the more complex model, behavioural data will be the starting point for segmentation, but we will come back to that when we have the basics in place.

 

 

The example above illustrates a win-back segment in which the customer cancelled his/her subscription six months ago. This is common to all customers in the segment just like that they have all been customers for more than a year as well as customers in “Product group 3”. These criteria are variable and especially “classification” should be conducted in line with parameters that are relevant to your business model.

This is just the beginning

With this guide, you are ready to start your win-back strategy. However, notice that the more data you can use, the better you can tailor the communication and execution towards the individual customer. The crucial factor is that you solely rely on useful data and that you don’t wind up in a situation where the segmentation becomes too complex.

In addition to segmentation, there are multiple steps on the way to optimising your win-back activities. In the following, you can see an example of areas that should be kept in mind when working with win-back.


If you are interested in the idea of winning back lost customers, there are many options. Besides segmentation and communication, there are several different tools that you can use.

If you wish to know more about win-back and subscriptions in general, don’t hesitate to contact me at pj@subscrybe.com.