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Retention Versus Reactivation

It costs more to acquire a customer than to retain one.

This old adage holds true across most businesses, but is especially true in highly competitive environments. There are various methods to retain customers, but let's focus on the two main phases of keeping a customer active: retention and reactivation.

First, let's take a look at retention. This process begins as soon as the first purchase is made by the customer. Remember, your best customer is a competitor's top prospect, so maintaining the relationship from the beginning is easier and more cost effective than waiting until they've begun to stray. Strategies and tactics in this phase consist of targeted relationship, support and cross-sell messages that are timed according to the purchase cycle and engagement level of your customer base.

The second stage is reactivation. As customers move further away from your forecasted repurchase window, they are now, once again, prospects rather than lapsed customers and your 1:1 messaging needs to reflect this transition. Research has shown that the purchase process normally includes both emotional and rational phases. Depending upon the product, the emotional phase is usually in the awareness and consideration period, with the rational phase coming into the process prior to, during and just after the purchase. This process reverses itself as customers fail to reengage and become inactive. Thus, emotional messaging should increase as time passes, bringing the emotional content of your brand campaign into your 1:1 communication program as a customer approaches inactivity.

The relationship between a brand and a customer is similar to any other relationship; you need to continually capture the heart and mind of a customer and 1:1 provides the perfect opportunity to deliver the best message for that process.