Most winback strategies for Direct-to-Consumer (DTC) brands often miss the mark and fail to produce significant results. Let’s break this down:
The Standard Winback Approach
Typically, winback triggers are set around the 90-day mark, a standard across many industries (an issue to be discussed separately). There’s a widespread belief that if a customer hasn’t made a repeat purchase by then, the likelihood of them churning increases significantly. This is generally accurate: an excellent repurchase rate for a DTC brand hovers around 30-40%.
In practical terms, this means that every month, 60-70% of newly acquired customers may not return. This attrition is painful, especially given the slim profit margins under which most DTC companies operate. Consequently, many brands resort to offering discounts before customers churn.
The Flaws in the Traditional Approach
While this approach is understandable, it has flaws. Many brands already inundate their customers with discount offers in their general marketing campaigns. Now, expecting these customers to act on yet another offer simply because it’s part of a winback flow seems unrealistic.
To clarify, I’m not saying all winback flows are useless. However, most are in direct conflict with existing campaigns and discount strategies. Here are some critical points supporting my argument:
- Email Engagement Drops: After 30-60 days, email engagement plummets, reducing the impact of your offers.
- Assumptions About Price: Discounts assume that price is the main reason customers aren’t buying again (how do you know this?).
- Repeated Incentives: You’ve likely already offered similar incentives multiple times before.
Are All Winback Campaigns a Waste?
Not entirely. For subscription-based brands, they are particularly valuable. But for most DTC companies, over-optimizing these flows expecting significant results is futile. Instead, it’s more productive to analyze the reasons for churn and improve the customer journey for future buyers, avoiding the repetition of past mistakes.
Effective Winback Emails: A Different Approach
While many winback emails fail to deliver, there is a specific strategy that has shown promise: a simple, personal letter from the founder when a customer is about to churn. Here’s how to implement this:
- Change the Sender Name: Use a personal touch, for example, “Jane from EcoGoods”.
- Craft a Personal Message: Reaffirm the brand’s value proposition in a heartfelt manner.
- Add a Time-Sensitive Offer: Sweeten the deal with a limited-time discount to encourage quick action.
Why This Works
- Personalization: Changing the sender name and crafting a personal message creates a sense of connection. Customers feel valued and appreciated when they receive a direct message from the founder.
- Reaffirming Value: Reminding customers of the unique value your brand offers can reignite their interest and remind them why they purchased from you in the first place.
- Urgency: Including a time-sensitive discount leverages urgency, motivating customers to take immediate action.
Conclusion
While traditional winback emails often fall short, a personalized, value-focused approach can make a significant difference. By rethinking your winback email strategy and focusing on genuine connection, reaffirming value, and creating urgency, you can improve your chances of winning back customers and enhancing their overall experience with your brand.
In conclusion, while winback flows have their place, most DTC brands would benefit more from focusing on improving the overall customer experience and addressing the root causes of churn, rather than relying heavily on traditional winback emails.
