Velocity Customer Retention Program

Client: Off-Price Fashion Retailer

Highlights

  • Program paid for itself in two weeks
  • Direct mail ROI = 224%
  • Direct mail response rate = 15%
  • Email ROI = 252%
  • Email response rate = 11%
  • One email opened/clicked = $12.50 in value

Background

With locations from California to Massachusetts, this retailer’s off-price assortment of merchandise features moderate to better fashion apparel, accessories, gifts, linens and shoes. The company was experiencing significant erosion in its best customer base — the top 25% of shoppers — who represented two-thirds of sales. In fact, these highly desirable customers were dropping in value faster than any other group. This combination of fewer people spending less money was alarming to the client, who knew that drastic measures were called for in order to save this top tier of shoppers.

Objective

The goals of our proprietary velocity customer retention program were to:

  • Track customers’ spending patterns
  • Identify and intercept customers whose spending behavior declined from expected levels
  • Quickly boost declining-value shoppers back into a normal spending pattern
  • Rebuild a vibrant, engaged top customer base that would sustain its size and spending patterns moving forward

Retain Your Top Customers

Are your highest spending customers declining? Get the boost you need with the Velocity Customer Retention Program.

Strategy

An 18-week test program used direct mail and email to reach declining top customers. Direct mail offers and versioned messages were tested to assess response and long-term lift. Emails were sent to an even broader range of top customer segments, with different subject lines tested to see which variables were most effective in driving improved open rates and higher response.

Results

Both direct mail and email results were extremely positive. The direct mail program paid for itself in the first two weeks of the program, delivering a 224% return on investment, with a $4 incremental increase in spend per name mailed. The email program generated a 252% return on investment, with an $8.50 incremental increase in spend per name mailed.

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