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5 Email Sequences Guaranteed to Increase Customer Lifetime Value

September 22, 2020
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We’ve all heard the saying — it costs a lot less to keep your existing customers than it does to acquire new ones. But anyone who has been in business for a while knows that that is much easier said than done. So what is it exactly that keeps customers coming back for more? And if they aren’t coming back naturally, what are some ways that we can make it impossible for them not to? 

In this blog post, we’ll cover:

  • What customer lifetime value (CLV) is and why it’s important
  • Best practices for retaining your customers using email marketing
  • Proven templates, copy, and creative that will keep your customers hungry for more

Let’s dive in…

What is Customer Lifetime Value (CLV)?

Before we get into the fun stuff, it’s important that we understand exactly what customer lifetime value (CLV) is. Chances are that you’ve heard this acronym or term being thrown around but may not have a full grasp on what exactly it is, why it’s important, or how to calculate it. 

According to Shopify, the lifetime value of a customer, or customer lifetime value (CLV), represents the total amount of money a customer is expected to spend in your business, or on your products, during their lifetime. 

You can calculate a customer’s lifetime value using the following equation:

CLV = (Average Order Value) x (Number of Purchases Per Customer Per Year) x (Avg. Length of the Customer Relationship in Years)

CLV is an important metric to track because it helps business owners determine how much money they should invest on acquiring new customers and retaining existing ones. And as we touched on above, it’s a lot more cost-effective to retain your current customers than have to acquire a new one, which is why putting an emphasis on customer retention is key to scaling your business in the long run. 

5 Email Sequences You Can Implement TODAY to Improve Your CLV

Email marketing is one of the most effective (and the most affordable) means of keeping your current customers happy and coming back for more. A successful retention marketing strategy is not complete without a robust email marketing program. And here at Power Digital, we are big fans of using email marketing automation to accomplish customer retention goals for our clients. If you simply implement the 5 email sequences below, you will start seeing improvements in your CLV metrics almost immediately. 

Replenishment Sequence

Product replenishment campaigns are the bread and butter to igniting repeat purchases. Replenishment campaigns are designed to be highly specific based on the last product purchased and on average how long it takes a user to finish a specific product. This sequence works best with brands in the CPG, Food, Skincare & Makeup, and CBD space. Use “last order date” data to your advantage and send timely reminders to your list of subscribers who are about to run out of their products. 

Email Cadence recommendation: 

Email 1: 7 days before product is scheduled to run out 

  • Main goal: Remind users that it is almost time to re-order and get the user thinking about the product that is almost empty 
  • Content to include: Influencer imagery of the product in use, blogs on how to use the specific product, etc.

Email 2: 3 days before product is scheduled to run out 

  • Main goal: Remind users that they are only days until their product is scheduled to run out. Create a sense of urgency as time dwindles down. 
  • Content to include: Dynamic countdown timer to increase urgency

Email 3: Day that product is scheduled to run out 

  • Main goal: Relive barriers to that replenishment purchase by offering a discount to BUY NOW now that the user is completely out of their product
  • Content to include: Discount to secure a purchase 

Post-Purchase Sequence

This series is intended to acknowledge customers immediately after they’ve purchased, provide you with an opportunity to get feedback about your products, and allow you to send valuable information to your customers that will help them get the most out of their purchase.

The first and most important email in this series is a “thank you” email. Send this immediately after a purchase has been made to give your customers some peace of mind that their order has been successfully placed. Best practice is to include a recap of the order placed (either a product image or as a line item) to give customers an opportunity to review their order.

Next up, provide them with information on how to use your product in order to maximize their experience. Provide them with step-by-step instructions, direct them towards your FAQs, or link to supporting blog posts. It’s also great if you can provide them with an easy way to get in touch with you should they have any additional questions.

After they’ve had time to use your product, send them an email asking for a review. Testimonials and social proof are extremely powerful in converting new customers, but it can be a hard to get customers to leave a review. To help overcome that challenge, provide your customers with an incentive for leaving their feedback. Even something small like free shipping or a 5% off discount can go a long way.

Win-Back Sequence

Win-back series are used to encourage lapsed customers to re-engage. You’ll know the time-frame that works best for your audience, but unless your product is seasonal, you will most likely want to reach out to customers who have not engaged in the last 4 – 6 months. 

To entice your customers into coming back, use catchy subject lines (first impressions matter – you want them to open!), showcase what’s new on your site (products, blogs, site features), highlight company updates (think recent press or new branding), and offer a discount. You can get creative with your discounts but creating a sense of urgency (i.e. limited time offer) seems to work best in these campaigns.

Cross-Sell / Upsell Sequence

The thought behind this sequence is simple: same customer, different product. If your brand sells multiple products (especially multiple complementary products), this sequence is a no-brainer. The goal of the cross-sell / upsell sequence is to push existing clients to try out other products or services or upsell them to a higher tier of product or service. 

There are two keys to a successful cross-sell/upsell sequence: 

  1. Using affinity data and/or dynamic personalization to cross-sell the customer on the most appropriate product for them based on their most recent purchase. 
  2. Timing the cross-sell at the moment the customer is most delighted with their purchase. 

Let’s unpack that a little bit. To point #1, it’s important that you are being as strategic as possible with what you choose to cross-sell your customer on. If you sell 2 different products, choosing what to cross-sell is a little bit easier than if you offer hundreds of different SKUs. 

Our advice? Dive into the data in the backend of your e-commerce store and nerd out a little bit. If you see that most customers who buy Product X are more likely to also buy Product Y, then there’s your cross-sell. Sometimes you’ll see that customers who buy Product X are more likely to continue buying Product X (but maybe in different colors, materials, etc). It varies business to business, but once you dive into the data, this affinity behavior will soon be very clear. 

Finally, on point #2, you want to ensure that you are sending your cross-sell messages when your customer is most delighted with your product or service. Again, this varies by business but typically, you have a pretty good idea of this time frame. For apparel businesses, it may be right after the product arrives and they’ve tried it on and want to order more. For food businesses, it may be when they’ve officially incorporated the item into their daily diet or regimen. 

Loyalty / Rewards Program Notifications  

Congrats! Your customer is now part of your rewards program, meaning they want to interact with your brand in a more meaningful way…now what? It’s not enough to just send a one-time “thanks for joining our rewards program” message; you need to make sure you’re continuing the conversation to stay top of mind. 

Triggering automation messages for your loyalty program is an easy way to remind customers of the program, how many points they have, and if they’re eligible for any new rewards. As you encourage them to use more of their points, they’re reminded of your brand, making them more likely to purchase other products and in turn, increasing CLV. Win-win. 

While messages are going to vary based on the exact details of your rewards program, here are some ideas on the types of automated messages to send:

  • Outline how the program works and how to navigate the program upon sign up 
  • Nudge users to use their points for the first time if they never have
  • Notify and congratulate users whey they move to the next level in the program and detail how that benefits them
  • Remind users of their point totals (if not zero), on a monthly or bi-monthly cadence

Wrapping Up

So there you have it! Five proven techniques you can implement right away to start seeing improvements to your customer lifetime value. And remember… while acquiring a new customer may seem more exciting in the moment, never underestimate the value of retaining your existing customers. That is the key to growing and scaling your business in the long-run!

If you need a little help setting up these email campaigns, reach out to the Power Digital Email Team today. We can’t wait to connect with you!

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