When and How to Win Back the Most Profitable Lapsed Customers

How one business predicted the customers worth reactivating and targeted them to unlock profitable growth.

3x

higher conversion rate targeting the most profitable customers

$110K

increase in gross profit

Problem

One Las Vegas-based D2C brand had accrued more than 200,000 lapsed customers over the course of two years, but they understood that attempting to reactivate all of them with a one-size-fits-all approach would not provide sufficient ROI. Their CMO knew that separating the high-value customers worth investment from others would drive the brand’s profitable growth. But their customers’ past purchase history alone wasn’t enough to make accurate predictions as to which customers were the most profitable to retain.

Obtaining new customers is exciting, but retaining them long-term is the best way to build a sustainable business. So while many ecommerce and subscription businesses realize they need to win back lapsed customers, most have difficulty identifying which lapsed customers are worth the investment to win back. Most brands blast all their lapsed customers with the same email and the same promo. The result is a lot of unsubscribes and unprofitable customers taking advantage of promos.

Ocurate can predict with 90%+ accuracy the lifetime value (LTV) of every lead, existing customer, and lapsed customer, helping brands identify the customers most likely to be profitable. Since Ocurate’s privacy-first database on every adult American’s behaviors and attitudes is an integral part of its AI, they can also signal to the brand when a customer’s lifestyle changes, and what kind of effect it has on that person’s LTV. Perhaps in purchasing a home, they now match the brand’s ideal customer profile in a way that moves them from the low LTV to high LTV category. Knowing this, the brand can understand when and how to take action based on changes in each individual’s lifestyle.

Solution

Ocurate connected the Las Vegas brand’s customer data to Ocurate’s own database of 260 million Americans’ attitudes and behaviors. By cross-referencing the data, Ocurate pinpointed telling and relevant behavior changes at the individual customer level like a new home purchase, relocation, becoming a parent, and increased interest in sports.

Ocurate then layered on their machine learning model, which predicted the customers that would provide the most lifetime value and were most worth reengaging. 

how ocurate helps businesses get better higher value customers.


Outcome

By launching one win-back email campaign, the brand converted 10% of their lapsed high-value customers. That translated to $110,000 in gross profit. Previously, their best attempts to reactivate lapsed customers only converted 3% for any given win-back campaign.

To enable the brand to achieve such results, Ocurate predicted the lifetime value of each current and lapsed customer with 95% accuracy, identifying 35,000 high-value lapsed customers (out of 229,000 total lapsed customers) that had the biggest opportunity to be reactivated in the month of August. Using these predictions, the brand launched one win-back campaign that offered a higher promo via email, resulting in the reconverting 10% of those customers in just one email. 

With the CMO’s goal to reactivate 60% of high-value customers by the end of the year, the brand is poised to build a more profitable customer base