Click each section of the Venn diagram below to find out more  Reactivation (repeat win), retention (keep), acquisition (win), cross-sell (develop), up-sell (develop) and experience (reason) are the real drivers for strategic customer marketing and increased profits.
Focus marketing effort where it matters! Start with re-activation - on high value inactive customer segments. Why? As an example, if you have 50,000 customers, of which… 10,000 are active (purchase last 12 months) 15,000 are in-active (last purchase 12 - 24 months) 25,000 lapsed (last purchase 24+ months) Average order value = £50, Average orders per annum = 2.5, GP margin = 30% Then by re-activating 10% of in-active customers plus  5% of the lapsed, you will generate… 2,750 of what are in effect 'new' customers £343,750 of additional turnover £71,937 GP - after allowing 10% marketing cost (£34k)
Even if you already run a re-activation strategy, it is well worth examining the reason for churn - probably due to an 'experience' and also look for ways to improve that strategy using for example, value-driven segmentation. To help, you use our latest dynamic Re-activation/churn 'what-if' calculator.   Call +44 (0) 1733 890790 if help needed.
Reactivate (repeat win) If you find that a customer on your file no longer does business with you, maybe you should try to reactivate them. The ability to try to reactivate/win back lapsed customers assumes that you have systems that actually monitor customer’s activity or inactivity. The whole idea of investing in customer knowledge indicators is to create a base of trusted information on which you to make decisions. Reactivation can only be achieved if you have the relevant measures and customer understanding on hand. Think of lapsed customers as those that you could win back if you have the right value proposition and their attitude to you is not negative. Top Retention (keep) Customer retention is one of the best ways of ensuring the survival of an organisation. However, hand in hand with the recognition of the need for customer retention is the need for customer analytics. What does the customer value about the way you treat them or supply a service? What value for money do they receive? A customer knowledge indicator must be built to identify the customers you actually have, the customers you want to retain and what they actually value. If the 80/20 (or 70/30) rule applies, then retaining the wrong customers will help destroy a company’s profit very quickly. If retention is important and identifying the right customers is one of the most important things a company can do, why is it that not all companies are doing this? Well without customer knowledge it may be almost impossible to identify your customers in any unique fashion let alone calculate some metric regarding their short or long-term value. This may be one of the reasons companies have been pouring money into call centres as a means of servicing their customers and "doing CRM" rather than the really tough alternative of actually addressing the real need for a corporate CRM policy and customer knowledge. Top Cross-Sell (develop) The desire to sell more products/services to existing customers has been an extremely successful way for many to grow their business. Over the last few years, many mergers and acquisitions have been founded on the concept of cross-sell. However, merely saying you will cross-sell does not make it happen. Successful cross-selling is based on extensive customer knowledge and many organisations have found significant cost savings in their use of customer data. They have reduced their cost of sale and also their cost of customer acquisition. Top Up-Sell (develop) The idea is to help your existing customers perceive the worth (sell) of a higher value product/service than the one they currently have. Very simply you move someone from one product to another of higher value. By moving your customers up through your range of services (and products) with different margins and bundles can benefit both parties. Over the lifetime of a customer, they may move from one income band to another and their needs, desires and ability to pay will change. The fact you can predict behaviour through the use of customer data, the knowledge that can be extracted from this with the right tools, and human interaction is a means of improving the bottom line. To be successful requires the organisation to focus on customer behaviours and life-cycle patterns. Most successful up-sell models are based on providing real value to the customers and also form part of any organisation’s retention strategy. Migration is an extension to Up-Sell.  Migration strategies should be considered where you wish to promote a new version of a product your customer previously purchased.  Life-cycle also comes into play and can be used to determine the best timing to suggest an offer to migrate to a replacement model, take a software upgrade, switch to a replacement service package, etc.  Top Acquisition (win) In many respects, acquisition has always been the way companies built their business. Without acquiring customers, you don’t have any to retain. The many voices that talk about acquisition in the past tense seem to have forgotten the basis of all business - you need to acquire the right new customers and retain the right existing customers. In some industries where there are few suppliers, you may already have some kind of relationship with 99 percent of the market, but there are always other markets and other niches for the creative. Acquiring the right customers for those that have customer knowledge indicators is a task of identification. By identifying the profile of your most valuable customers and those with the greatest future value potential, you can recruit more that share their profile. If you don’t have customer knowledge indicators and functioning CRM philosophy, it is more hit and miss. Market research helps but is not sufficient. Organisations that have invested in a customer knowledge targeting system have a built-in advantage and unique differentiator over their competitors - the information they have collected, collated and mined on their existing customers! Remember that there are number of alternative channels for the potential customer to buy your goods, and some may involve the choice to interact with a real human being. To attract the right customers; use the information you have. Often as not, what a customer did yesterday, he is likely to do today - so find more that will act like him. Top Experience (reason) Any and all customer experiences can and do create both positive and negative feelings. We live for experiences that are positive and try to avoid the negative. Our experience of a service or a product is intrinsically bound up with how we value the relationship, the transaction and our perceptions of the company we are interacting with. If perception is reality then the customer experience leads one to comment, "I will see it when I believe it." The customer experience is all. If a customer has a bad experience, they might give you a little more rope, but the experience is remembered. For example, when something good happens you tell three or four people and when something bad happens you tell 12 or more. The customer experience must be something the organisation invests in - both at senior management level and throughout the organisation. In some instances one bad experience is enough to drive a customer away. Modelling your good customers then treating them badly is a recipe for disaster.  Top Click here to see how to analyse your data with the Targeting Workbench Technologies4Targeting Ltd., Geneva House, 3 Park Road, Peterborough. PE1 2UX. United Kingdom  Tel: +44 (0) 1733 890790  Fax: +44 (0)1733 890799  Web: www.technologies4targeting.co.uk  Email: info@tech4t.co.uk Tech4T also partner with marketing and IT service providers to deliver data-driven solutions to their clients