Dear Growth Molecules: If A Customer Churns What Can I Do To Win Them Back?
In the competitive world of B2B and B2B2C SaaS, customer retention plays a crucial role in driving business growth and success. However, losing customers is inevitable, but it doesn’t have to be permanent. This is where customer success managers (CSMs) can step in to execute win-back campaigns, which aim to re-engage and win back churned customers. It is an effort worth considering: according to a study by Marketing Metrics, the probability of selling to an existing customer is 60-70%, while the probability of selling to a new prospect is only 5-20%. When the cost to acquire a new customer is 5-25 times more than it costs to keep a current customer, driving a win-back campaign is an economical way to secure revenue.
In this blog post, we will explore the key strategies and best practices that CSMs can employ to create and execute effective win-back campaigns, increasing the probability of the revival of customer relationships and the growth of the business.
Understanding the Importance of Win-Back Campaigns:
Win-backs are important: 45% of subscribers who receive a win-back email will go on to open future emails from your brand. More emails opened, the greater the chance of a conversion. Win-back campaigns are an essential component of any customer success strategy, as they present an opportunity to revive lost customer relationships and increase revenue. By focusing efforts on customers who have churned, CSMs can potentially convert them into long-term, loyal customers once again. Moreover, the cost of acquiring new customers is typically higher than retaining existing ones, making win-back campaigns a cost-effective approach for SaaS businesses.
Segmentation and Targeting:
The first step in executing successful win-back campaigns is to segment the churned customer base effectively. CSMs should consider factors such as the reason for churn, length of relationship, and potential value to prioritize their efforts. According to Hubspot, the most effective strategies for email marketing campaigns are subscriber segmentation (78%). By categorizing churned customers into segments, CSMs can tailor personalized messages and offers that address the specific needs and pain points of each segment.
Crafting Compelling Messaging:
Once the segments are defined, CSMs should focus on creating compelling and personalized messaging to re-engage churned customers. In the same Hubspot study, message personalization accounted for the next highest effective strategy (72%) for email marketing campaigns. The messaging should highlight the unique value proposition of the SaaS product and demonstrate how it can address the customer’s pain points effectively. By showcasing the improvements or updates made since the customer’s departure, CSMs can reignite their interest and instill confidence in the SaaS offering.
Leveraging Multiple Channels:
To maximize the reach and impact of win-back campaigns, CSMs should leverage multiple communication channels. This includes email marketing, social media platforms, targeted advertising, and even personalized phone calls or video conferences. By diversifying the channels, CSMs can increase the chances of reaching the churned customers and capturing their attention. It is crucial to ensure consistent messaging across all channels to maintain a unified brand image and provide a seamless customer experience.
Monitoring and Measuring Campaign Performance:
To gauge the success of win-back campaigns, CSMs should establish key performance indicators (KPIs) and closely monitor the campaign’s performance. Metrics such as conversion rate, response rate, and revenue generated can provide insights into the effectiveness of the campaign. By continuously evaluating the results, CSMs can identify areas for improvement and optimize future win-back efforts.
Win-back campaigns present a valuable opportunity for CSMs to re-engage churned customers and drive business growth in the B2B and B2B2C SaaS industry. By implementing segmentation, crafting compelling messaging, leveraging multiple channels, and monitoring performance, CSMs can create and execute win-back campaigns that have a high likelihood of success, ultimately fostering long-term customer relationships.
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About The Author:
Sabina is the Operating Partner at Growth Molecules™, a consulting firm that helps B2B SaaS companies simplify customer success with actionable processes and scalable programs. With a 20-year career in global CS and CX, Sabina is known for building teams from start-up to grow-up, for scale via client adoption, expansion, retention and loyalty programs. She has earned her MA in Communication & Leadership from Gonzaga University, and her BA in Public Relations from the University of Southern California, and is co-writing a book about working moms in technology.