Direct mail is mostly renowned as a customer-acquisition tool, but if you’re not also using it as a reactivation tool, then you’re missing out on a significant opportunity, especially when it comes to your lapsed customers. Direct mail therefore offers a tangible and personalised approach to reconnect with these individuals, providing a unique opportunity to rekindle relationships and boost customer loyalty.

• Who Are Lapsed Customers?
• Importance of Retaining Customers
• Why Use Direct Mail to Engage Lapsed Customers?
• Benefits of Using Direct Mail Strategies for Engaging Lapsed Customers
• X Direct Mail Strategies for Engaging Lapsed Customers
• What Does Successful Reengagement of Lapsed Customers Look Like?
• Why Work With a Direct Mail House?
• Ready to Re-Engage Your Lapsed Customers?

Who Are Lapsed Customers?

Lapsed customers are individuals who have previously engaged with your business, through purchases or interactions, but have ceased to do so over a certain period. The duration that defines a customer as "lapsed" varies across industries and businesses, depending on purchasing cycles and customer behaviour patterns, however identifying these customers is the first step in developing effective re-engagement strategies.

Importance of Retaining Customers

Retaining existing customers is important as it is often more cost-effective than acquiring new ones. Loyal customers are already a ‘warmed’ audience and tend to make repeat purchases, refer others, and contribute to a stable revenue stream. Moreover, they are more likely to try new products or services and provide valuable feedback. While businesses need both acquisition and retention, data suggests that acquiring a new customer can cost 5 to 25 times more than keeping an existing one, and research from ClearlyRated shows that up to 65% of total revenue is generated by existing customers who spend about 67% more than first-time buyers. Therefore, by focusing on customer retention, businesses can enhance profitability and foster long-term success.

In today's competitive landscape, ignoring lapsed customers means leaving significant revenue on the table. Studies from Bain & Company highlight that a mere 5% increase in customer retention can boost profits by 25% to 95%. This incredible return on investment stems from the high customer lifetime value (CLV) associated with retained clients. Effectively re-engaging customers requires precise targeting and clear messaging, which is why having clean and accurate customer data is paramount before launching any campaign. For many businesses, investing in proper data processing services is the non-negotiable first step to ensure high-quality mailers reach the right individuals, maximising the potential for successful reactivation.

Why Use Direct Mail to Engage Lapsed Customers?

Direct mail is a great way to engage with lapsed customers, who seem to have gone off the radar. This is because direct mail stands out by offering a physical, tangible connection and provides a personal touch that can break through the digital, oversaturated, noise, capturing the recipient's attention effectively.

Direct mail also boasts higher open and response rates compared to many digital channels, making it a powerful tool for re-engaging lapsed customers. The tactile nature of mail is a key psychological advantage; research has shown that direct mail requires 21% less cognitive effort to process and generates 70% higher brand recall compared to digital media. Unlike an easily deleted email, a physical mail piece—whether it’s a detailed brochure or a simple, compelling postcard marketing piece—can remain in the household for an average of 7.0 days, increasing the opportunity for repeated brand exposure. This staying power is critical when trying to reignite a relationship with a customer who has been dormant.

Benefits of Using Direct Mail Strategies for Engaging Lapsed Customers

Personalisation

Direct mail can be tailored to include the recipient's name, past purchase history, and personalised offers, making the communication more relevant, engaging and attention-grabbing.

Tangible Impact

A physical piece of mail creates a lasting impression, often leading to higher recall rates and a stronger emotional connection to the brand. Industry results revealed that the average piece of Direct Mail generates 134 seconds of attention across all household members, demonstrating the profound engagement possible with this physical medium. Furthermore, over 20% of mail is filed away in the home, reaching a three-year high, proving its enduring value as a reference tool.

Higher Engagement Rates

Recipients are more likely to open and read physical mail, leading to increased opportunities for re-engagement. This engagement translates directly into action, whereby 6% of mail prompted a purchase, a 43% year-on-year growth, with 38% of mail-driven website visits converting into a purchase. This robust performance underscores why direct mail is essential for driving measurable commercial outcomes in an omnichannel marketing strategy.

Versatility

Direct mail can be used to deliver various types of content, including promotional offers, personalised messages, and informative brochures, catering to different re-engagement strategies. The wide range of available formats, from a unique one-piece mailer to a professionally enclosed letter, offers creative freedom that digital channels cannot match.

3 Direct Mail Strategies for Engaging Lapsed Customers

1. Motivational Offer

Providing a compelling incentive can entice lapsed customers to return. This could be in the form of exclusive discounts, limited-time offers, or special promotions tailored to the customer's previous interests or purchases. Creating a sense of urgency by highlighting the limited availability of the offer can further motivate prompt action. Consider extending the offer into a series of timed mailers to test different creative approaches, a vital part of effective campaign management.

2. Personalisation

Personalising direct mail by addressing the recipient by name and referencing their past interactions with your business can make the communication much more impactful. Utilising your customer data to tailor the content ensures that the message resonates with the recipient, making them feel special and therefore increasing the likelihood of re-engagement. This high degree of customisation is made possible through modern digital printing techniques, allowing for variable data printing (VDP) that goes far beyond simple name merging.

3. Triggered Direct Mail

Implementing triggered direct mail involves sending communications based on specific customer behaviours or milestones. For instance, if a customer hasn't made a purchase in a predefined period (such as 180 days), an automated mail piece can be sent to encourage re-engagement. This approach ensures timely and relevant communication, enhancing the chances of winning back the customer. This method is highly efficient and offers significant ROI, especially when managed in conjunction with digital marketing automation, creating a true omnichannel experience. By setting clear parameters for when a customer becomes 'lapsed' and automatically deploying a high-impact mailer, you can efficiently target customers at their optimal re-engagement moment. To execute this seamlessly, reliable production and fulfilment processes are essential.

What Does Successful Reengagement of Lapsed Customers Look Like?

Successful re-engagement is characterised by lapsed customers resuming their interactions with your business, whether through making purchases, engaging with your content, or participating in loyalty programs. The KPIs will be specific to your business but often include increased purchase frequency, higher average transaction values, and improved customer feedback. You’ll be able to measure the success of your re-engagement of lapsed customers campaign by tracking these KPIs, especially when you have added adequate tracking capabilities to your mailers such as the use of QR codes, promotion codes or unique URLs. A crucial part of measuring success is ensuring the foundation of your campaign is accurate; without best practices for data hygiene, your performance metrics will be skewed by deliverability issues and wasted spend.

Why Work With a Direct Mail House?

If you’re wondering where to start when it comes to planning and executing your direct mail plan for lapsed customers, then partnering with a professional direct mail house, such as Direct Mail Systems (DMS), can offer several advantages:

Expertise

The team at DMS has extensive experience in creating and executing effective direct mail campaigns tailored to various business needs across industries.

Resources

With state-of-the-art printing and mailing equipment, DMS ensures high-quality production and timely delivery of your mail pieces.

Data Management

DMS provides data processing services to clean and enrich your customer data, enhancing the accuracy and effectiveness of your campaigns.

Cost Efficiency

Leveraging bulk postage services and established relationships with postal providers, DMS can offer cost-effective solutions for your direct mail campaigns. The advantage of a mail house extends to format selection; whether you need high-volume, cost-effective envelope enclosing or unique, bespoke pieces, an expert partner ensures your creative vision aligns with production efficiency. This holistic management, from print files to mailbox, is critical for achieving optimal ROI from a reactivation effort.

You can therefore effectively streamline your re-engagement efforts, ensuring that your direct mail campaigns are both impactful and efficient.

Ready to Re-Engage Your Lapsed Customers?

Get started today by contacting the DMS team to discover how our tailored direct mail solutions can help you achieve your customer retention goals.