The document discusses the importance of retention marketing and focusing on existing customers rather than solely pursuing new customer acquisition. It notes that existing customers typically represent a significant portion of annual sales and spend more over time than new customers. However, many marketers struggle with customer retention due to issues like a lack of integrated customer data. The document advocates using predictive analytics to better understand customer behavior and integrate data to improve targeted, personalized retention campaigns. This can increase sales, optimize discounts, and engage at-risk customers to improve retention rates.

1. The State of Retention Marketing
Turning One-Night Stands Into Lasting Relationships

2. Seventy-three percent of customers buy once and never come back.
Most marketers have resigned themselves to the transactional nature
of today’s consumer and focus efforts on retargeting or – you guessed
it – more acquisition. But focusing on existing customers is far more
valuable than you realize.
Because they’re worth it
AgilOne retail benchmarks show that on average, return customers
represent 38% of overall annual retail sales. But existing customers
are far more valuable than you realize. Based on an analysis of nearly
5M transactions, we found that existing customers are not only worth
more over time, but they spend more and shop more often.
Getting past the first date
A recent Infosys survey reported that 78% of consumers are more
likely to be a repeat customer if a retailer provides them with targeted,
personalized offers. While the CMO Council reports that 50% of US
and Canadian consumers would abandon their loyalties to retailers
who don’t.
The data divide
But 40% of marketers blame difficulty integrating data across
channels for the lack of personalization, 35% blame lack of quality
customer data and 32% blame fragmented systems.
When it’s okay to be single
With customer data sitting in multiple locations, it’s critical to
integrate key behavioral and transactional data into a single customer
profile. Data that’s the most relevant includes:
• Personal data and preferences (also used to match and de-
dupe customer records)
• Transactions (online, call center and in-store)
• Email data (opt-ins, opens, clicks)
• Web data (visits, views, wishlists, items browsed, abandoned
carts, etc)
By consolidating, cleansing and de-duplicating your data, you’re
left with a single customer profile that allows you to measure true
customer lifetime value (LTV) and identify your most valuable
customers. An analysis of AgilOne’s customer base has shown
that without it LTV is off by 25% and 1 out of every 10 of your most
valuable customers are misclassified.

3. It’s not business, it’s personal
According to AgilOne’s Consumer Survey: “Marketing Personalization Preferences of Shoppers
Worldwide:
• 66% of consumers prefer an email offering a discount for product being browsed
• 49% of total respondents are interested in new customer welcome campaigns
• 42% want a special offers or discount for an abandoned cart
100% Pure Increases Sales With Predictive
The same study showed that only 26-28% of consumers indicated interest in store openings and
automated replenishment reminders, both can yield impressive results. 100% Pure is a beauty retailer
founded in 2005. Using AgilOne, the beauty brand defined its retail footprint by identifying which regions
had the highest concentration of buyers. They invited customers within 50 miles of a new store – with
high predicted lifetime value and high likelihood to buy – and saw same-day store sales 700% of the
normal average. They also targeted buyers of their popular eyebean cream and increased sales by 200%
by sending replenishment reminders via email. Read the case study.

4. Predictive marketing can help your retention efforts by making it
possible to:
• Identify, understand and engage high-value customers
throughout their lifecycle.
• Personalize interactions and increase conversion
with behavioral, brand and product clusters and
recommendations.
• Improve conversion and optimize margins through surgical
discounting based on likelihood to buy propensity models.
• Optimize contact frequency and re-engage high-value
consumers for re-marketing via direct mail, Facebook and
display advertising using predictive email engagement.
• Acquire more of the right customers by measuring
campaign sources of high-value customers.
Retention is the new acquisition:
How to build lasting relationships
Retention marketing is a critical component to current and
future business success and longevity. Integrating predictive
marketing into customer lifecycle marketing makes it possible
to increase AOV, purchase frequency and optimize overall CLTV.
Here are some ways you can integrate predictive marketing into
your lifecycle marketing efforts.
Grow customer value: Give your customers a reason to
buy again. Segment customers by lifecycle, cluster, email
engagement, likelihood to buy and lifetime value. Sample
campaigns include:
• Post-Purchase Messaging • Behavior-Based Clusters
• Replenishment Campaigns • New Product Introduction
• New Customer Welcome • Product Recommendations
• Product/Brand Clusters • VIP Recognition
Improve retention and reactivation rates: Identify at risk
customers and re-engage them pro-actively through likelihood
to buy predictive models.
• Purchase Frequency
• Churn Prevention/Preventive Touch
• Reactivation
• Remarketing through direct mail, Facebook and display
advertising
How do you rank against
your peers?
A study conducted by AgilOne
of retail performance showed
average conversion rate of one-
time buyers to two-time buyers is
only 27% with retailers retaining
not much more than 1 out of 10
customers (12%) and reactivating
only 17% of those that lapsed.
Traeger Grills increases
revenue by 45%
Traeger Grills is an international
outdoor cooking retailer that’s
committed to providing quality
grilling products since the
1990s. AgilOne helped Traeger
replace batch and blast emails
with targeted campaigns to
groups or ‘clusters’ of customers
with similar behaviors and
preferences.Now Traeger is
sending fewer, but more relevant
emails to their customers. As a
result, not only did their revenues
go up, but their unsubscribe rate
also came down by 40% in just
six weeks, preserving important
revenues for the future. They
increased their click through rates
300% in just 30 days and had a
45% increase in revenues. Read
the case study.

5. The cost of [an email] breakup
Most marketers rely on email to reach their customers. But 60% of future customer lifetime value is
lost when a customer unsubscribes from your list. That adds up to $1.1 million in lost revenue each year
for a midsize retailer due to email opt-outs.
Email engagement predictive models make it possible to understand and segment engagement
behaviors, allowing you to:
• Adjust contact frequency, increasing frequency to “Enthusiasts” while decreasing frequency (and
unsubscribe rates) of “Sleepy’s and Phantom’s.”
• Uncover lost email segments that you’re segmentation might be missing.
• Reduce email costs associated to marketing to inactive subscribers.
When combined with Likelihood to Buy, marketers can:
• Increase retention and drive incremental sales by remarketing to valuable or high potential – and
low engagement - customers via Direct Mail, Facebook and display.
• Optimize conversion and preserve margins by increasing aggressiveness of discounts based on
likelihood to buy, offering lower discounts to those with a high likelihood and better offers to entice
consumers with a lower probability of converting.

6. Learn more about retention marketing best practices.
Visit the AgilOne Academy at http://www.agilone.com/academy
The Retail Marketing Playbook
is AgilOne’s formula for a more effective marketing strategy.
Use any of the 17 campaigns individually or combine several
campaigns for a more complete customer marketing strategy.
• [VIDEO] Identifying Your Most Valuable Customers
• [VIDEO] 3 Steps to Creating an Effective Reactivation Strategy
• [WEBINAR] The Science Behind Customer Centricity
• [BLOG} 3 Wrong Ways to Segment Your Customers
• [BLOG] The Difference Between Segmentation and Clustering
Consumer Preference Survey
Marketing Personalization
and Shopper Preferences
Introductory Guide to
Clustering
The Definitive Guide to
Customer Lifetime Value