The Retention Email: Why You Need It and How To Improve Customer Retention

The Email Marketers
January 4, 2022

The Retention Email: Why You Need It and How To Improve Customer Retention

One quick google search on "email marketing" will reveal a core group of emails that every brand needs to be sending, but just having a list of emails to send out isn't exactly helpful. So every now and then I like to pull back the curtain and show what exactly goes into these emails that everyone says are so vital to a brand's marketing success.

So today, I'm taking a deep dive into Customer Retention Emails: what they are, why you need them for your business, and what the very best retention emails look like.

First off, what is Customer Retention? Well, to break it down, it's retaining the customers you already have--making sure those people who have purchased your product or service continue to do business with you.

That may sound easy, but the truth is it's not as simple as it sounds. The big question is "How?" How do you keep customers coming back? How do you even reach them? It's not like you can text or call, right?

No, there will be no texting or calling recommendations, but there IS one gift the 21st has brought us: the good old email. Yep, you can retain your customers using email.

The Romantic Side of Email Marketing

Think of retention emails as being an important element in the relationship you have with your customers. Retention emails are the maintenance part, not the "meet-cute," "flirtation," or "honeymoon" part. More the" day to day, let's keep this working" part.

But here's the thing about a good relationship: it can't stay in the honeymoon phase forever. And that's a good thing because most of us don't want to be stuck in a perpetual limbo of dating. We'd like to have a committed partner whom we love deeply.

The same is true in email marketing: it costs 7x as much to acquire a new customer as it does to retain an existing one. Building relationships with your existing customer base has the potential to be hugely profitable!

But all relationships take work, and retaining the customers you have is no exception. If you just groaned, you might want to check yourself. First, you have to get that old Disney paradigm out of your head. Folks do not meet and "live happily ever after." Am I right?

If you're nodding vigorously, you're primed to understand just why retention emails will be crucial for your business to flourish.

They represent the "work" of the relationship you have with your customers. They're your way to keep the relationship happy and help it continue smoothly.

Why You Want To Court Your Existing Customers

We all love the newest and latest thing. Businesses and business owners are no different, and so businesses laser their focus on attracting new customers, ie on customer acquisition.

That's all well and good, because yes, a business does need to attract new customers; but too often this comes at the expense of existing customers. The "old" customers are left to languish.

This is a mistake. And there are concrete reasons why.

  • Firstly, acquiring new customers is pricey! Not only does it cost 7x more to a prospect into a purchaser, but it's up to 5x more cost-effective to keep one that you already have!
  • Secondly, the likelihood of selling to a new customer is 5-20%, whilst the likelihood of selling to an existing customer is 60-70%.
  • Thirdly, a customer that has ALREADY bought from you has a 32% probability of purchasing from you again in the first year. This is a paying customer, not a pie-in-the-sky prospect!

Need more convincing? Presenting...

The 80/20 Rule

There's a saying out there called the 80/20 Rule. It states that 80% of business comes from 20% of customers. Yep, 80%. It's important to keep and cultivate those customers that are for all intents and purposes keeping your business afloat!

In order to build customer loyalty and retain customers, it's necessary to keep them engaged and connected.

How? Listen to their concerns, show them products you think might be of interest to them, thank them when they purchase with you, check in with them, and perhaps extend the occasional gift.

But it's not like you can go and knock on the door of each and every person who's ever bought something from you. There has to be a simpler way!

There is. It's called a solid customer retention strategy.

Customer Retention Strategy

You can see it seriously pays to make sure you are keeping your customer engaged and happy. So you need a retention strategy to do that right?

Here comes email marketing, one of marketing's highest generators of ROI, if not the highest. Retention email marketing presents probably the lowest investment cost for the highest returns.

An email is a super effective way to reach out and communicate with your customers--highly convenient and proven to work. Email marketing has many tricks of the trade that can be crafted into a good retention strategy.

Let's explore how to take the strengths of email marketing and use them to create a rockstar retention email marketing campaign.

Customer Retention Emails

In order to keep customers engaged, loyal, and satisfied, you will need to use retention emails.

These are targeted and triggered message that encourages customers to return. In particular, you want to make keep your paying customer coming back so that they will make repeat purchases.

Email Marketing And Great Customer Retention Emails

Using emails to reach customers and retain existing customers is cost-effective and tried and true.

You likely already have some great email campaigns in place. Believe it or not, by simple durst of you having flows in place, you are already on your way to building customer retention strategies.

If you do not have flows in place, let this blog help to start building your email flows, starting with retention emails and then branching into other areas. FYI, email marketing flows are automated emails that are targeted to certain customers based on the actions they take or their placement in your customer journey cycle.

Start With Segmentation

When you talk email marketing, the term segmentation is bound to arise. When it comes to retention emails, it's no different. You will need to segment your existing customers into smaller groups and create automated email flows for each group.

Some Examples Of Customer Retention Email's Segments

With segmentation, it falls to you to decide how you will want to group your customers or subscribers. But we can give you some examples of segments you might find valuable.

  • All Caps LOYAL Customers: these are the loyal users who buy from you again and again. The repeat purchase customers. You love these folks! It really pays to keep them happy. Make a segment especially for them that ensures ongoing customer satisfaction.
  • Your Every Now And Then Customers: These are the current customers you want to turn into LOYAL customers. You know that you interest them, but you want to send the right message that excites them! Analyze their behavior and past purchases. See what they purchase and when, or when they abandon their cart. Then offer solutions that will increase their purchase behavior and get them to the next purchase. The data will guide you to find the relevant content here. Maybe offer a special discount or free trial of your service.
  • The Ghosts: These are the customers who maybe were with you for a bit but haven't bought from you or engaged in a while. They are your inactive users. Here, your retention messaging will work to convince customers to come back. In essence, these will be targets for a win-back email campaign. Again, a special discount or free trial of your service might be in order. If it's a no-go, and they are truly no longer interested, ask for feedback--this will help your retention strategy in the future. You should welcome negative feedback as much as positive feedback--it will help you strengthen your brand.

Remember, though, these are simply a few examples. It'll be up to you to pick your segment--and actually, that's part of the fun, as most marketers will tell you!

What To Do With Your Segments

Now you've come up with some segments and divided your list accordingly. What now?

Well, a useful starting point is, of course, making sure each customer gets a personalized email--personalized emails are much more like to be opened with higher click-through rates than an email that feels like it goes to just anyone. Personalization adds to the customer experience of your brand and hopefully makes your customers feel seen and valued.

Things to Include For Each and Every Segment

Remember each email should feel personal and contain a clear call to action. Each of these customer retention emails will have a specific intention, and your call to action must guide your customer to realize that intention. Clear CTAs equal a higher click-through rate.

And of course, the subject line for each segment will be individualized and important. The subject line is the first part of your campaign that an email recipient will see. Don't let the whole campaign go to waste because you didn't put thought into unique and compelling subject lines tailored to the segment.

Next, you'll want to look at the personalized reports from your ESP and create segments to decide the types of customer retention emails each will be getting.

Types Of Customer Retention Emails

You'll have various segments of customers to consider for your customer retention email campaign. And each segment will need its own customer retention marketing flow. The options are many, but here we list, with examples, some of the handiest customer retention emails.

Customer Appreciation Emails

Everyone loves a little appreciation. The Customer Appreciation email is a way to send a hello to your customers with no strings attached. Feeling appreciated by you will add to your customer's desire to keep doing business with you.

Reminder Emails

This email serves to remind customers of a certain action you would like them to take. The classic is the cart abandonment email. A surprising number of customers are known to drop out of a purchase before sealing the deal, so to speak. Send a cart abandonment email to remind them to complete their purchase.

The reminder email is a powerful way to connect with your customers and generate revenue. There are several types of reminder emails. Besides cart abandonment, you can send reminders about account expiration, or reminder emails to re-purchase or replenish the supply of your product.

Customer Feedback Emails

This type of email is a great way to build your brand and keep happy customers. When you ask for honest feedback and then implement improvements, you are showing your customers that their needs come first. This will keep them around, as you are working to meet their stated needs.

These emails can give you a glimpse of your customer's pain points, and you can frame your products and promotions as a way to solve those pain points. What better way to retain customers than to improve something in their lives?

Update Emails

The update email also acts as a promotional email. It offers exclusive looks at a new product or new features. It keeps your customers in touch with what's happening with your brand, helping keep them in the know about new features or new products.

You can choose to highlight a particular feature or a new feature with this email, and it's a great way to drop in your customers' inbox to nurture positive impressions of your brand.

Win Back Series

Remember, retaining existing customers is cheaper than getting new ones. So try not to lose the ones you've had. Avoid churned customers with a check-in email, promoting a product, or asking for feedback. In fact, you can reduce churn by 11% simply by reaching out to them.

Help! How Does All This Look? Customer Retention Email Examples.

Ok, you know how darn important retention email marketing is. But is your head spinning as you try to envision all these segments and different types of customer retention email?

We gotcha. The rest of the blog will feature a great example of each type of email we discussed, and get your creative spark going as you move forward in designing the campaign that will keep your retention rate high :)

Customer Appreciation Email Example:
Customer Appreciation Email Example from GrubHub
Why This Works:

This Grubhub gift is unexpected and because of that earns the customers goodwill. The messaging is clear and the $5 off graphic grabs the eye, there is no mistaking what this email is about! Who doesn't want $5 off--it probably speeds up that decision to order again!

Reminder Email Example:
Reminder Email Example from FontBase
Why It's Awesome:

Simple and to the point. Gives the customer a courteous and straightforward reminder that their subscription is up for renewal. Helps avoid any customer displeasure at an unexpected renewal fee or lapse in service.

Customer Feedback Email Example:
Customer Feedback Email Example from Netflix
Why It's Awesome:

Another simple and direct email from a company on top of its game. Thanks the customer/subscriber in advance and give good feels by saying that the feedback is welcome. The CTA is clear.

Update Email Example:
Update Email Example from R/M
Why It's Awesome:

High quality graphic and a concise message about product innovations make this email awesome. The CTA to learn more is prominent and functions as part of the email design.

Win Back Email Example:
Winback Email Example from GoDaddy
Why It Works

This win back email offers a discount to customers if they return. The discount terms are clear and right at the top of the email (30% off). The CTA follows right behind, and after the thrust of the email has been clearly stated, the text remunerates the GoDaddy pitch points. Simple, uncluttered design, and a generous discount to returning cutomers.

Final Thoughts On Retention Emails

The customers you already have are incredibly vital to the health and growth of your company. Returning customers take less investment and are far more likely to purchase with you than potential customers.

But you cannot take them for granted.

As in all relationships, one must adjust and check in periodically to make sure the other party is feeling appreciated and understood. Retention emails are the way to do those check-ins and adjust accordingly.

You can nurture the all-important relationships you've already cultivated with your customers by creating email flows designed to keep them satisfied and to keep them coming back. Keep them in the loop with your brand. Offer them exclusive perks and discounts. Share with them what their community of fellow customers loves about your brand.

In short, turn each email into an "Aren't you glad you let us into your inbox?" reminder.

So what's the holdup? Get out there and strategize! And if you feel a bit lost, remember, outsourcing this type of campaign is always an option. There are specialists available who are well versed in all the ins and outs of email flows, including retention flows. :)