We spend a lot of time talking generally about how direct mail APIs can make workflows more efficient. But it’s often easier to show than to tell, which is why we launched this series. Last time we looked at acquisition for CRM marketers. In today’s entry, we consider retention and reactivation for subscription-based businesses.
There’s a reason the subscription model is rapidly becoming the holy grail of the tech economy. The magic word is ‘recurring’: recurring value to a customer while creating a steady source of recurring revenue.
However, businesses built around subscription models are particularly susceptible to churn. Customers who feel they have little skin in the game are likelier to hop off their subscription, guilt-free. That’s why it is essential to curate a strong experience for each and every customer.
You can leverage different channels of communication to maximize customer satisfaction and therefore minimize churn. Otherwise all the money spent on acquisition is flushed after just a few months, instead of serving as the activation cost for a lifelong partnership.
Currently, we see many subscription-based customers focus on large batch direct mail acquisition strategies, and while they are crucial, they neglect retention, lifecycle and reactivation workflows. For subscription businesses, direct mail is a silver bullet. Don’t leave it in the chamber!
Direct Mail-Based Subscriber Retention
On the lifecycle side, marketers are already using emails and SMS messages. Savvy marketers know to apply digital methodologies like automatic triggers, deep segmentation, and ROI tracking. But only at the bleeding edge do we see direct mail complementing these efforts.
It’s all about ROI. To recoup acquisition spend, direct mail should be set up and triggered at key lifecycle events for subscribers. As soon as someone signs up and makes a purchase, for instance, a postcard personalized with 1st purchase information that includes discount offer on a second purchase should be automatically triggered.
With an API approach, deep customization is effortless. HTML variables allow easy individualization, making customers feel special and engaged with the brand. It’s absolutely crucial you don’t restrict follow-ups to just before renewal. By leveraging personalized DM, you can make clear your company is excited to work with the customer and not just with their wallet.
To build truly omnichannel retention workflows, map the key touchpoints in your customer lifecycle. Then reach out across mediums to build a relationship and consistently engage each customer. Keep them consistently “warm”, not oscillating between “cold” and “hot”. Variability invites churn. If your customer feels you’re just happy to take their money, it’s game over.
Direct Mail-Based Subscriber Reactivation
On the flip side, say a customer leaves. It could be seasonal (poor timing), they may have had a bad experience with your service, or they could just be busy. Relevant, timely reactivation is key. Even if you only reactivate a small fraction of churning customers, you can still recoup most of the costs of the entire acquisition campaign. With segmentation and an API approach, it’s easy to reach out to customers with exactly what they need to see.
If a customer makes the conscious choice to churn out, independent of interacting with your service, there should be an automatic trigger in place. We’ve found customers that trigger a personalized reactivation postcard at key moments, when the customer is falling out of the funnel, not only incentivize the customer to re-activate their subscription, but effectively give the company an opportunity to re-engage the customer. It’s all about providing a compelling branding experience and offer to catch their attention and interest with your brand.
If someone churns out thanks to a poor support experience, there should be a different automatic trigger in place. Using an API, you can set an automated trigger that causes a postcard to be sent to a customer whenever a poor Zendesk score is submitted by the customer service team. Companies that focus on including humble messaging and an attractive offer to remedy the support issue find that they reduce churn, create an event for another purchase, and keep long-term customers.
Subscription-based businesses need to make a mindset shift vis-a-vis direct mail. Maintaining relationships and keeping customers is just as important, if not more so, than acquiring new ones.