Build – or Regain – Customer Loyalty with Direct Mail
In the best of times, direct mail is an important tool for building customer loyalty. But during difficult times, treating your customers right — and leveraging mail as part of that process — is absolutely essential.
Smart marketers continually reach out to their customers, looking for ways to increase their loyalty. Here’s why: A general, old rule of thumb says that it costs five times more to acquire a new customer than to keep a current one. Maybe it’s more than five times these days due to the greater number of choices available to consumers.
While some adjustments are unavoidable, like in the current COVID-19 pandemic and economic downturn, customers basically still want to feel special. Or put another way, they want to feel delight, that continuing to spend money with your business is a pleasure. A loyal customer is engaged at a more emotional level. You’ve earned their trust, their confidence.
So how can you do that with direct mail?
Here are some ideas.
1. Segment your customer list
Think about your most valuable asset: your customer data. It’s more than just a list of names, addresses, and emails. It’s a set of dossiers or profiles of individuals who’ve spent their money with you. You have transactional history and behavior information that you can build on for projecting future growth, building lifetime customer value.
Depending on what your objectives (and budget) are, you can figure out whom you want to target using the RFM (Recency, Frequency, Monetary) model. Your offer, copy, and design can vary based on what you decide to prioritize as well as what will likely be most relevant to the customer.
For example, supermarkets send coupons to customers based on frequent purchases of the same brands or product types to encourage more of the same. Some chains go further by diving deep into the data to produce 100% personalized self-mailers with coupons and sales announcements for their favorite or most recent purchases using variable data printing.
Or how about sending your customers special offers on their birthdays? Even if you just know a month, the thought is often appreciated, and rewarded with a purchase.
2. Reconnect with past customers
Despite your best efforts, some customers drift away. Maybe their purchase was a one-time thing. Maybe you made a mistake along the way in how you treated them. (It happens). Or maybe their financial situation changed, or something else happened, and they just disengaged from you.
To win these underperformers back, you already have a starting point: that data (see above) you have on why you connected in the first place. You know their preferences — at least some of them. So make them an offer! This is your chance to regain their business with dollar amount or percentage off discounts, for example. You can also suggest new products or services that they might like based on their past purchase behavior.
3. Cross-Sell or Upsell
You can be satisfied with your customers making the same purchases from you again and again. Or you can look for ways to increase share of wallet by offering other products or services that they might need, or even better, want.
You may need to do some heavy education here to move them down the sales funnel. The goal here is that they’ll spend more and more with you, and not with your competition. How you position these offers is up to you, but think of how enticing it is to be told that you deserve special treatment and extra benefits (or value) because you’re a “VIP.”
4. Offer help
One large demographic whose loyalty can be earned is new movers. According to U.S. Census Bureau data, about 31 million people moved last year. Despite many differences, what all these people have in common is that they are likely in the market for all kinds of goods and services that can help them feel comfortable in their new homes and neighborhoods.
Which ones? Healthcare, schools, retail, food, insurance, home improvement, security, banking, telecom, supermarkets, to name just a few. For very motivated consumers, with lots of money to spend, this is your brand’s opportunity to help them when they need it most, and maybe, establish a relationship.
5. Building your brand
It doesn’t matter whether you’re a painting contractor, a car dealership, or a major retail chain — your brand is valuable. It grows not just because of your efforts, but because of loyal, satisfied, delighted customers who share their affection for your company.
With direct mail, you can make this happen by using referral rewards or friends-and-family discounts. For example, you could mail a postcard offering a specific dollar discount on their next purchase, then the same for another customer that your loyal customer passes along.
Wrapping it up
When planning your direct mail strategy, remember that customer loyalty, like any relationship, depends on continuous — not necessarily constant — communication. To connect with your customers more effectively and build a following, it’s smart to test offers, copy, and images on your mail.
Your direct mail marketing campaigns will ensure loyalty when they’re personal, relevant, engaging, and consistent in their messaging and branding.