Reactivation Example
Let us take a concrete example of how a progency would operate.
One of the biggest challenges a marketer faces is that of dormancy – acquired customers go inactive after a certain time. I estimate this to be about a third to half of a company’s customer base. These are customers the company probably paid good money to acquire – either via branding campaigns or performance marketing. If they do not become sticky, it is a big loss for a brand.
As I wrote earlier: “Brands have spent good and big money acquiring these customers but for various reasons that relationship is no longer active. Instead of a blossoming friendship, brands and customers have become strangers to each other. Both have gone their own separate ways. Is there a way to bring them back together and rekindle the joy that they had once experienced however briefly? … Reactivation hasn’t been looked at seriously since it falls between the two stools of acquisition and engagement. The adtech team wants to acquire new customers – which is also what the top management would like to see and show. The martech team wants to drive engagement and retention, and ignores customers who were once new but are now inactive. No one is responsible for reactivation. This is the whitespace for marketers – it can give faster success at lower spends. (But which marketer wants to lower their spending budget?!)”
For a marketer, the priorities tend to be new customer acquisition (because that is what everyone else is doing – it is like a land grab) and engagement with the active customer base. In this, trying to reactivate dormant customers is among the top priorities. This is exactly the problem for a progency.
Marketers can provideemail IDs and mobile numbers of the inactive customer base to the progency on a performance-based success fee: get paid 50% of the cost of new acquisition for every reactivated customer. It is a win-win for both sides. For a marketer, this is better than going through the Google-Facebook route where the acquisition costs are spiralling. Reactivation at half the cost of reacquisition should be a no-brainer decision. For the progency, they have a free hand to run a parallel program that doesn’t need daily sign-offs and discussions with the brand’s marketing teams.
For a progency, the way to go about this would be to start with push messages to ‘awaken’ the user. This is where the trio of Ems, AMP and microns can create the opening. If dormant users still have the app installed, push notifications can be added to the mix. The reactivation goal could be something as simple as a specified number of actions (opens, clicks, site visits, app opens) in a 30-day period or even a transaction. The progency has its martech platform and messaging capabilities to deliver the outcomes. It will need to move the dormant customer along the path of becoming an opener (of push messages), then a clicker (to go to the website or app), and eventually a transactor.
Reactivation is thus a “blue ocean” opportunity: it isn’t being done today. Marketers are not interested given their other priorities, and no agencies who just have creative skills can deliver the outcomes needed. The progency is the only way to tap into this large opportunity.
