April 2009
What's the usual advice for reactivating past customers?
Send 'em a special offer with a discount, right?
Yet this strategy produces underwhelming results for most health and wellness businesses.
Why? Well, here's why health and wellness businesses lose customers:
About 70% leave because they never felt connected to your business
About 15% leave because your products and services missed the mark
About 10% leave because they got a better price or better terms and conditions elsewhere
(The remaining 5% died or moved away.)
Now you see the problem with a special offer: it only attracts the 10% who weren't happy with your prices. And these aren't even the customers you should invest in reactivating. They'll leave again, as soon as they find a better offer.
Instead, invest in winning back the customers who really WANT your business to succeed for them.
Winback is an everyday task - not an occasional initiative when your revenues are falling short.
Below, we explain the two principles of successful customer reactivation programs and give you a list of targeted reactivation tactics:
Principle #1: Customer feedback is an everyday priority
Getting structured, formal customer feedback should be a scheduled daily priority for your management team.
Why? You'll develop a customized profile for your business of why your customers leave. Then, you can create purposeful customer retention and winback action plans based on that profile.
Email surveys are cheap and efficient, but they're not always as effective as a live conversation. So pick up the phone and actually talk one-on-one with a sample of customers, too.
And don't overlook simple tools like suggestion boxes and comment cards.
Combine all the data from different sources. Analyze it to find patterns. You'll use these patterns to choose appropriate winback tactics.
(A common mistake: surveying only former customers, instead of getting ongoing feedback from current customers.
This is like ignoring your high fever, chills, cough and shortness of breath until you're finally hospitalized with pneumonia. Retention is cheaper and easier than reactivation, so do your business a favor and get feedback from your existing clients and members early and often.)
Principle #2: Winback is not one-size-fits-all
Customer reactivation is not a one-size-fits-all project.
First, customers leave for different reasons:
Choose reactivation techniques that target those specific reasons. We've got a list below of sample reactivation techniques for each of the most common reasons customers leave health clubs, wellness centers, yoga studios and conventional, complementary and alternative healthcare practices.
Tip: If you use email feedback surveys, you can easily send a highly targeted reactivation communication specifically to those people who said in the survey that they weren't happy with your group fitness programs, or felt your staff wasn't very friendly.
Second, choose different reactivation tactics based on recency:
For example, Life Time Fitness sent winback discount offers to people who hadn't been members for over two years. When that much time has passed, a "what's new here" email and invitation to a free and useful seminar (not a sales pitch) is probably a better place to start.
On the other hand, you want to know right away why a regular customer isn't stopping by anymore. Are they mad? Are their feelings hurt? Lost their job? Has their schedule changed? You can potentially address some of these reasons immediately, especially if they start to reveal a pattern that's true for numerous customers.
TARGETED WINBACK TACTICS
1) Didn't feel a sense of connection with your business
Your goal here is to create a sense of community and a feeling that each customer is recognized as an individual, not just a punch card or barcode.
To encourage a sense of connection:
- Send an email newsletter, not just hard-sell email marketing promotions
- Include customer questions, answered by other customers<
- Tell customer stories - not just "good news" fluff, but real-life examples of how people overcome challenges or seize opportunities
- Share customer and client pictures on your website
- Send a press release about your "customer of the month"
- Invite customers to online or in-person events that they'll find valuable
- Host events that encourage customer-to-customer connections, not just customer-to-staff connections
- Celebrate achievement - client milestones, maintaining progress, annual customer anniversary
- Create marketing promotions that encourage current customers to reach out to former customers
- And of course, continually soliciting formal and informal feedback from customers - and taking action on it - is an excellent way to make your customers feel like they're truly valued by your business.
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