February 14, 2009

Lapsed Buyers And E-Commerce

Most businesses have a lot of lapsed buyers. These are customers who have not purchased in thirteen or more months.

In catalog marketing, there are many established best practices for marketing to lapsed buyers. Catalogers frequently bump their list up against the co-ops, mailing a 24 month buyer (one who hasn't purchased in the past two years) who recently purchased from a competitor. And this strategy works. Catalogers can profitably mail and reactivate customers who have not purchased in five years.

Ok, now you're an e-commerce business leader, one who doesn't believe in the fossilized version of direct marketing employed by traditional multichannel merchants. The customer hasn't purchased in twenty-four months, and does not have a mailable e-mail address.

How do you encourage this customer to shop with you again? In other words, how do you create demand with a customer, a customer you choose not to contact with traditional direct marketing?

This is our future ... and we need to be thinking about how to deal with it.

6 comments:

  1. Well, if you really do not want to send something by mail, you could try to do an email append to get the email address for lapsed older buyers... although, we have not had much success with reactivating this way. I am interested to hear if anyone else has some better ideas!

    Great blog by the way!

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  2. You hit on one of the challenges that I deal with when working with our online pureplay friends. These folks basically have e-mail as their only outbound communication method, and e-mail has limited effectiveness only with really recent, active customers.

    So as an industry, we have a challenge --- we need to invent methods for building relationships with customers who have not purchased with us in a long while. This isn't easy to do!

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  3. derek.newman4:37 PM

    Kevin,

    Are we sure that the ROI of attempting to reactivate lapsed customers is worth it?

    I assume that generally speaking the average value of a reactivated lapsed customer lies somewhere between a current, loyal (habitual) customer and a new customer. Are there industry metrics to support this? Is the value industry specific?

    If you rely on constant acquisition (as we do) then wouldn't I be smarter to let the people who have tried us and left just move on?

    Cheers

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  4. Derek --- no, we're not sure that the ROI is worth it. Your assumption is a good general rule, however, and has been validated in almost every Multichannel Forensics project I've worked on.

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  5. Well it’s not an easy task to gain lapsed buyers or customers, but we can try some methods like posting an advertisement about the juicy discount offers, online promotion and good promotion on social media platform, these methods will defiantly grab your customer attention.

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  6. One of the essential fashion ecommerce website features that need to be installed from the very start is the ability of websites to capture customer data information (captured with permission, of course) and use it to grow the business. CRM should be embedded in any ecommerce website and should be dealt and used with care.

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