Using personalization to reactivate and win-back lapsed customers
Loyal customers are hard to acquire and it is equally important is to retain them. Even after all the effort, some customers may get lapsed over time to the competition. Here is a strategy to win them back using A/B testing, product personalization and email personalization.
Objective: Improve the reactivation of lapsed customers
Client: Leading QSR (Quick Service Restaurant) brand in Europe
What?
Study of consumer behavior across multiple segments and the impact of targeted A/B offer communication with product personalization and email personalization.
Challenge
Huge number of products — challenge in personalizing the exact product on which the offer has to be sent.
Approach
Segmenting repeat lapsed customers by K-means and identifying TG based on lapsation period. Now segmented customers should be targeted by splitting into two bases A and B with Offer 1 and Offer 2 and then interchange the offers
For personalizing offers around product a scorecard or Index with two factors can be considered
Considering Customer engagement data the day and hour at which the customer can probably click on email can be identified and meal preference time can be identified from transaction data.
Ideally for recommending a product, the lapsation score should be less and the reactivation score should be high. Based on K-means Segments (We have created 6 segments) each segment will have a different best product and a different email open or click time. Each segment can be targeted based on their product scorecard and engagement data and content personalization can be done for each segment.
Insights
Product marked in green is having good reactivation rate and least lapsation rate. Based on this data for a particular segment (out of 6 segments) lapsed customers can be targeted.
What Next
Similar targeting can be done for retaining repeat customers by personalizing product and email
— Analysis by Avinash Tiwari and Umesh Reddy.
