When a customer has cancelled their subscription, there’s a window of opportunity to win them back. If effectively capitalized upon, you can save your monthly churn rate and keep the customer aboard ship.
For CSMs, a win-back campaign is a vital strategy used to re-engage customers who may have previously churned or ended their relationship with our company. By targeting these former customers, CSMs aim to persuade them to return and continue their previous relationship with the company.
The data and strategies in this article is from our ultimate churn-busting resource: The State of Customer Churn. Nab yourself a copy here.
What is the importance of win-back campaigns?
The importance of win-back campaigns cannot be overstated. They offer a cost-effective way to recover customers who have already shown interest in your products or services and have already been acquired. Instead of focusing solely on acquiring new customers, win-back campaigns leverage your recently churned customer base to reignite interest in your product.
In light of this, we wanted to know the full extent of win-back campaigns, including whether organizations carry them out, at what point they run their win-back campaigns and the most effective win-back strategies.
The current landscape of win-back campaigns
We were surprised to discover that 72.9% of participants in our survey don’t have a win-back campaign in place for customers.
| If the company has a win-back campaign | Percentage |
|---|---|
| Yes | 72.9% |
| No | 21.7% |
Upon further inspection, we learned that 36% of these win-back campaigns take place at the point of cancellation, and a further 28% of win-back campaigns are carried out one-month post churn.
Less than one-third (24%) of win-back campaigns take place three months after the customer has churned, with 8% happening six months post-churn, and a measly 4% of win-back campaigns happening a full year after the customer churns.
| Time | Percentage |
|---|---|
| Point of cancellation | 36% |
| One month post-churn | 28% |
| Three months post-churn | 24% |
| Six months post-churn | 8% |
| One year post-churn | 4% |
Our expectations continued to be shattered as we found out that those with win-back campaigns had a higher monthly churn rate (6.9%) on average than those without win-back campaigns (6.4%).
Now, there are several reasons why win-back campaigns are unsuccessful,​ and timing is a huge factor in their efficiency. For example, if a customer has already moved on and found a replacement product or service, then a win-back campaign is unlikely to be successful.
Other reasons win-back campaigns can be unfruitful are due to a lack of personalization, ignoring the root of churn, or overselling.
Grace Gupta
Effective win-back strategies
For the CSMs who did conduct win-back campaigns, we asked them to identify which strategies they found to be the most effective. We’ll go through a few of them in detail now.
Acknowledging issues and offering solutions
When exploring win-back solutions with our survey participants, we found that the most popular win-back strategy amongst CS professionals was to acknowledge any issues and offer solutions, pulling in 37.5% of the vote.
This strategy combines emotional appeal (acknowledgment and empathy) with practical solutions, addressing both the rational and emotional aspects of a customer's decision-making process.
Strategy approach
So how do you go about approaching this strategy? Let’s go through the steps:
Identify lost customers
As with any win-back strategy it begins by identifying those you need to target. Begin by analyzing customer data to find out who has stopped engaging.
Research reasons for departure
Now you’ve got your nifty list of customers you’d like to try and reengage, you’ve got to find out why they dropped off in the first place. You can go about this is two ways: Data analysis and outreach.
For data analysis, look at the places in the customer journey where customers began to disengage. Look at the type of products the customers were previously engaged in, but have stopped using. These kinds of data points will give you an idea of any larger issues with your customer journey.
To look at any more specific issues, or moments of disengagement that don’t have a clear reason, reach out to customers through surveys ex-customers or review feedback to get more qualitative feedback on why these customers left.
Personalize your approach
Now it’s time to get specific to each individual customer. Think about whether you can segment the reasons for disengagement into different pathways to tailor messaging more specifically.
Acknowledge the issues
For more unique situations, you must make sure to directly identify and address the problems that caused them to leave. While some losses will be out of your control, the majority won’t, and the simple act of taking responsibility for any mistakes on your part goes a long way to getting customers back on board.
Present solutions
Now, one of the worst things you can do is get to stage four of the strategy and stop there. An apology without action behind it is meaningless. So when taking responsibility for the issues that caused the initial disengagement, your next step is to explain how you’re fixing (or have fixed) the issues brought up.
Offer an incentive
The next step is to sweeten the deal for these customers. Offering discounts or exclusive offers is really a strategy in and of itself, but providing a special discount or exclusive offer to your reengagement pathways is a quick win.
Follow up
If they don't respond, a reminder might be necessary. The aim of this is to not sound pushy - this reminder isn’t an time-bound “get the offer while it lasts” type of message. It’s a message to let them know that you are still thinking about them, and want to keep the offer moment for them as long as possible.
Gather feedback
And finally, remember to close the cycle by gathering customer qualitative and quantitative feedback once you’ve actioned any changes based on the reasons for departure previously identified. Ask returning customers about their experience to prevent future churn.
Daniel Shimoni
Offering upgrade/reduced tier options
The second most common strategy our participants used was offering upgrades or reduced tier options, at 20%. This strategy recognizes that one-size-fits-all solutions often don't work in customer retention.
By offering options, you're more likely to find a sweet spot that encourages customers to return while also potentially improving their long-term value to your business. Lets take a look at the strategy as a whole:
Strategy approach
Segment churned customers and analyze customer data
As with the previous strategy, begin by grouping and analyzing customers based on their previous patterns and reasons for churn.
Design tailored options
As with creating pathways when acknowledging issues, you should create upgrade packages that specifically address and support the customer needs not currently being met. There’s also an opportunity to develop reduced tier plans with essential services at lower costs.
Craft personalized messages
Don’t just throw an offer out there without explaining why the offer is there in the first place. Use messaging to highlight benefits of new options relevant to each customer.
Reach out
And, with messaging comes actually choosing the right communication channels. If you have a customer who doesn’t open any of your emails, why would you reach out to them on email? Unless you have god-like copy, someone who doesn’t use email won’t see your offer at all.
Present options clearly
If you’ve got a customer who has several reasons for leaving, make sure to explain both upgraded and reduced tier choices. Emphasize value proposition of each option specifically based on the individual customer needs.
Offer a limited-time incentive
Unlike when handling more difficult customer issues, upgrade and tier options are mostly suitable for customers who had smaller issues or are not engaging due to external factors like budget restrictions. Due to this, it’ll work well to also add a sense of urgency with a special discount or bonus for quick action.
Provide easy reactivation
Make sure you keep it simple! The biggest thing to put a customer off is to make the act of reingagement long or annoying. As you already have their customer details, take the opportunity to simplify the process to resume service or switch plans with one click of a button.
Follow up
Again, sending a reminder if no response is received is a good idea as long as you’re not nagging. Adding some more urgent copy works for this strategy (unlike the previous one) because it’s targeting a different kind of customer need.
Collect feedback
And finally make sure to collect feedback on this strategy. Ask returning customers about their reengagement to help refine future strategies.
Do win-back strategies actually work?
Now after all this, it may feel like taking a step back to ask if win-back strategies actually work, but it’s an important question to ask.
Surprisingly our report found that 72.9% seemingly staunch opposition to win-back campaigns was illuminated by our CS experts. We asked them whether 72.9% of respondents not having a win-back campaign was surprising, and, in their experience, whether win-back campaigns are usually successful.
Win-back strategies can be effective, but their success varies depending on various factors such as industry, product type, and the reasons for customer churn. The effectiveness of these strategies is a topic of ongoing debate among customer success professionals.
As Melanie Lawn, Chief Customer Officer at Forecast, points out:
"Having a win-back campaign is one part of what CS can do. I haven't seen huge results from win-back campaigns, but I think it depends on the sector, offering, pricing and CS approach. I believe it is one of many 'CS plays' to include in your CS strategy."
This perspective highlights that while win-back strategies can be valuable, they should be considered as just one component of a broader customer success strategy. Their effectiveness can vary significantly based on the specific context of the business and its customers.
Some customer success professionals have found more success in other areas. For instance, Michelle Wideman, Chief Customer Officer at Silverfort, shares:
"I've had more success in going after closed/lost opportunities with prospects."
In some cases, focusing efforts on prospects who didn't initially convert might be more fruitful than trying to win back customers who have already churned. While win-back strategies may not always yield dramatic results, they can still be worthwhile for several reasons:
- They provide valuable feedback about why customers leave
- They demonstrate to customers that their business is valued
- Even a small percentage of successful win-backs can be profitable, given the lower cost of retaining a customer compared to acquiring a new one
- They can provide insights to improve retention strategies for current customers
While win-back strategies can be effective, their success is not guaranteed. They should be viewed as one tool among many in a comprehensive customer success strategy, and their implementation should be carefully considered based on the specific context of the business and its customers.
Looking to talk more about win-back strategies? Need some peer stories and tips to help get yours off the ground? Join the Customer Success Collective Slack channel with 5,800+ members and counting!
Customer success collective insider
Thank you for subscribing
Level up your customer success collective career & network with customer success collective experts.
An email has been successfully sent to confirm your subscription.
Follow us on LinkedIn
