How to Reactivate Past Clients – Part 1

Posted by nancybaki on April 9, 2019

 

 

 

 

 

 

 

 

Reactivate stale or past Clients can bring you new customers…. Most businesses ignore them, successful businesses learn new ways to get them to recognize you as a market leader.

 

Remember that it’s 6-7 times more expensive to acquire a new customer than to keep an existing one

 

When trying to re-establish relationships with past customers, some customers will be comfortable and feel as if they just conducted business with you yesterday while others will wonder why you went to the trouble of contacting them.

 

Who is a reactivation candidate?

To reactivate customers, you need to be attentive to the process. First, to determine which previous customers to reactivate, define what reactivation specifically means for your organization. Most companies define reactivation candidates based on their lack of response to previous marketing efforts. The typical sequential marketing efforts that an organization may follow begin with acquisition, then proceed to resell / upsell / cross-sell / downsell, retention / competitive defense / selective attrition and then reactivation.

How do you differentiate between customers who require selling and retention efforts from those who require reactivation efforts? First, and most obviously, if you know that you’ve lost your customer’s business, then you’ve probably exhausted your sales and retention efforts and can assign the customer to your reactivation group.

If you don’t know whether you have lost your customer’s business, make inquiries. If you find that it’s too expensive to keep in touch with customers, then analyze their buying history (e.g., length of time since last purchase, number of prior purchases, length of time between purchases and average order size) or apply industry averages to determine who might be a reactivation candidate.

 

Whom do you select for reactivation?

Before designating customers as reactivation candidates, determine whether you have their correct contact information. Exclude past customers who have outdated information that cannot be updated through third-party sources.

Also, review any customer service or third-party data you have on reactivation candidates and categorize the reasons for lost business as “controllable” (e.g., shipped wrong product two weeks after promised delivery date) or “uncontrollable” (e.g., moved from retail area). If you’re to blame for the failed relationship, determine whether there is value in re-establishing it.

Once you select your reactivation candidates, segment this group and test offers before spending money to reach them all at once. If possible, use lifetime value to determine which segments may yield a higher return.

 

When do you conduct reactivation marketing?

Reactivation is not a one-time event for when times are tough. Reactivation should be an ongoing activity prioritized among other marketing efforts.

Once you have customers who meet your reactivation requirements, execute a reactivation campaign. (See “Reactivation Letters” in the Sales Letter Library). With response history, you can develop a reactivation response model to determine the optimal timing and frequency of your reactivation efforts. For example, a model developed for a health products cataloger might show that the company maximizes its marketing dollars when it tries to reactivate past customers with a buy-one-get-one-free offer after these customers fail to respond to three months of discount offers following their initial purchase.

When you accumulate significant response history from your reactivation marketing efforts, build a model based on RFM analysis (recency, frequency, monetary) or data attributes that predict purchase propensity. A life insurance company might build a model based on age, number of children, marital status, income and interest rates to determine the likelihood of a previous term insurance customer buying a variable life policy.

 

What do you say to customers you want to reactivate?

People change over time and so does your business, so when you’re thinking about marketing to past customers, consider that your customers’ needs and preferences, as well as your business focus, may have changed.

Profile customer’s to create more personalized communications for each segment. Use past data such as RFM information and, if possible, append reliable third-party information that will enhance your customer understanding. For example, you might use third-party information to determine each customer’s age, family situation and income. Then you could send targeted communications to various segments depending on these data attributes as well as results from an RFM analysis.

In conjunction with customer profiling, make an in-depth determination as to why the relationship ended in the first place. Was it something you did? If so, you might have a manager or high-level executive make a personal call to “high-value” customers.

When communicating with reactivation candidates, use the information you have about them in your marketing communications to show your desire to have them back as a customer. Also, if your communication is asking the reactivation candidate to call a person at your company, create a group of call specialists trained to handle reactivation customers.

 

Investing in acquisition vs. reactivation.

Acquisition and reactivation are both investments designed to yield profitable customer relationships. When deciding how much of your marketing budget should be allocated to each effort, calculate the ROI on reactivating old customers versus acquiring new customers.

Whether reactivation involves less of an investment than acquisition depends on the extent of your data analysis, data enhancement and list rental costs. It’s generally true that with customer data available for analysis as well as past customers’ familiarity with a company’s name and product or service quality, reactivation efforts yield higher response rates and higher profitability than acquisition efforts do.

 

Make the first move.

Most organizations focus on acquisition, sales to current customers and retention. They see little opportunity in marketing to people who failed to respond to their offers. These organizations, however, are typically not customer-focused.

Instead of trying to understand why a prior customer is no longer responding, they assume that the customer is the problem in the relationship. The dynamics are similar to that of a person who refuses to talk to another person unless the other person reaches out first. Start looking at your past customers and commit to reaching out and re-establishing a relationship that is valuable to both sides.

 

In my next blog I will show you the 8 Steps to Designing a Reactivation Campaign, stay tuned.

 

If you need help reactivating stale clients, try our FREE test drive to gain access to our resources and tools, or you can also contact me directly.

Check it out at www.BestEntrepreneurSolutions.com/guidedtour

To Your Success,

Nancy Baki at Best Entrepreneur Solutions

www.BestEntrepreneurSolutions.com

Tax Benefits for Your Business

Posted by nancybaki on March 29, 2019

 

 

 

 

 

Mind Your Own Business!

The concept of minding your own business means that while you are grinding away at your day job you need to be investing in your future and minding your own business. Pretty soon you’ll be able to walk away from that day job and mind your own business full time.

The best way to do this is through the acquisition of real estate.

Let’s take a quick look at where you are losing all your money-taxes. Taxes have been around since 1913 in the U.S. and 1917 in Canada (even earlier in England). While the original intention was to only tax the wealthiest of the population, obviously that’s trickled down to the masses, including those in poverty.

Now, keep in mind the more money you make the more taxes you pay. The wealthy know a way of getting around this-form a corporation. Corporations offer tax benefits and protect you from lawsuits. To learn more about this talk with one of our business coaches or your attorney.

We’ve all heard the golden rule of: Pay Yourself First.

But, many of us don’t do it. Until you learn and put this rule into effect, you won’t have any chance of getting out of the rat race. What this rule does is force you to come up with more income to pay your expenses.

There are some key areas of finance you should learn about, taking classes is one of the best ways to do this. Here are the basics you should learn:

Accounting

It pays to know how to read financial statements. When acquiring businesses or assets you need to quickly see the financial standing of the company you are acquiring.

Many grown adults do not know how to balance a balance sheet. In the long term, this knowledge will pay off for you and your business.

Investment Strategy

This skill will sharpen with experience. Talk to investors and observe how they play the game.

Market Behavior

Know the laws of Supply and Demand. No business owner can do without understanding these basic principles of the market. Bill Gates saw what people needed. Open your eyes to opportunities. Look at what sells and who buys.

Law

Do everything you can to grow your business within legal boundaries. Know your corporate, state, and accounting laws.

Once you know these areas of finances you can make them work for you. The rich practically invent money. You have to know where to find a great deal. Let’s continue with real estate. Look for houses in trouble or find the court in your area that handles foreclosed, police impound or other real estate situations. You can either renovate and sell or rent for residual income.

So, essentially there are two main types of investors:

  1. Those who buy pre-packaged investments
  2. Those who create their own investments

You know which are the most successful. In order to be one of those people you need to know what to look for and how to respond.

You must:

  1. Find a good deal other people have missed.
  2. Raise the capital needed for the transaction.
  3. Put together a svelte team to execute the plan.

There is risk involved in every acquisition. The goal is not to avoid the risk, but to respond to the risk with confidence and a steady hand.

If you need help identifying potential money-makers, where to get the capital you need and how to put together a smart team, try our FREE test drive to gain access to our resources and tools.

Check it out at www.BestEntrepreneurSolutions.com/guidedtour

 

To Your Success,

Nancy Baki at Best Entrepreneur Solutions

www.BestEntrepreneurSolutions.com

5 Big Mistakes You Can Do That Will Kill a Deal With a Big Fish Client – Part 3

Posted by nancybaki on January 11, 2019

 

 

 

 

 

5 Killer Mistakes – Part 3

The last 2 posts covered the first four of the killer mistakes you can make that will not only make you lose your fish, but possibly your entire company. Today we’re going to talk about the fifth killer mistake: Up Cash Creek Without a Paddle.

Even when business is good there’s still a change of running out of cash flow. You have to always be prepared for a slow in sales or a surge in expenses. One of the keys to balancing your cash flow is to get your clients to pay on time. This can seem like a nightmare, but is absolutely essential to a successful business.

Here are some tips to speed up the payment process:

  • Always send invoices on time and adjust your records for potential audits.
  • Learn how the client processes payments on their side and find out precisely where to send invoices.
  • Find out who’s in charge of processing orders and payment, so you know who to contact if needed.
  • Have a follow-up procedure in place, just in case.
  • As a last resort, call your contact to ask questions.
  • Always make sure your invoices are correct before sending them out.

 

You also need to make sure your cash flow is protected. You can do this by:

 

  • Always know which accounts need paid and when.
  • Negotiate with your suppliers for the lowest cost possible.
  • Have a bank contingency plan in place.
  • Build your own inventor network.

 

These are all great ways to protect the cash flow of your business and prepare for fish transitions and slow sales. These last few lessons are all about finding and catching your big fish clients. These clients are essential to your success and your need to take the time to work through each of these steps carefully and correctly for the best success.

If you need help with any step of the process of catching your fish or subsequent big fish clients, try our FREE test drive for access to a wealth of great tools and resources as well as our business coaching and consulting.

Check it out at www.BestEntrepreneurSolutions.com/guidedtour

Next time we’ll talk about the last of the killer mistakes and how to combat it from hitting your business hard.

To Your Success,

Nancy Baki at Best Entrepreneur Solutions

www.BestEntrepreneurSolutions.com