Transform your retention strategy with Klaviyo
Imagine automating personalized conversations with every customer, whether you’re managing 100 or 100,000. With the intelligence section of Klaviyo Advanced KDP or Marketing Analytics, you can achieve this by automating your retention strategy with precision. This lesson will guide you through a proven framework to scale your retention strategy, boost engagement, and reduce churn: all with Klaviyo.
How can I build a retention strategy?
To design an effective retention strategy, answer these 5 essential questions:
- Which customer segments will benefit most from targeted retention efforts?
- How can I automate engagement touchpoints throughout their journey?
- What one-off strategies can drive immediate ROI and reduce churn?
- How can I optimize content for maximum engagement and relevance?
- What metrics should you use to measure, refine, and enhance your strategy continuously?
Explore these concepts in action with SWAK Cosmetics' success story using Klaviyo Advanced KDP or Marketing Analytics.
Note: This demo video shows features located under CDP within your Klaviyo account. You will be able to access these features through Marketing analytics or Advanced KDP. The location in the side panel is the only difference; all feature details and capabilities outlined in the video should match what you see in your account.
4 key RFM automations proven to boost overall revenue
Implement these 4 proven RFM automations to drive revenue and ROI. Refer to the specific flow image in the tab to set up these automations in your existing system.
Reduce churn
Automate a segment-triggered flow for customers moving to At Risk or Needs attention groups. Offer a personalized discount to re-engage these customers effectively. This approach has delivered over 2x ROI for many businesses using the intelligence section of Klaviyo Advanced KDP or Marketing Analytics.
Drive VIPs
Create a flow to invite customers to join your VIP program when they reach Champion or Loyal status. Create a filter that ‘VIP program’ is false to exclude current members.
Incentivize sign-ups with bonus points or a free item to sweeten the deal!
Add cross-sell flows to promote key products
Create a cross-sell flow with conditional splits based on the RFM group. For Champions and Loyal customers, send a thank you email post-purchase.
For all other RFM segments, offer a discount on related products if bought within 7 days to encourage that purchase.
Bonus: include recommended products from our product analysis dashboard to drive higher repeat purchases.
Align your winback flows with purchase behavior
Use the median performance chart from your RFM analysis report to identify critical periods for preventing churn. For example, if your repeat buyers typically make purchases within 2 months, but your at-risk customers haven’t purchased in 208 days, focus on the 60 to 200-day window.
Implement a winback series targeting specific purchase behaviors starting on day 60 and extending to day 200. By day 150, consider offering a discount to re-engage customers and encourage a return purchase.
Key campaign and one-off strategy recommendations that boost customer retention
Now that you’ve set up your key automations, it’s time to refine your campaign strategy. Below are examples of common campaigns you may send to each RFM segment.
Champion
- Text-based email campaigns from the founder or CEO to keep a personal connection
- Target with SMS if they aren’t already subscribed
- Target for mobile app download (if you have a mobile app)
- Send them surveys, invite them to personal meet-ups or exclusive events
- Opportunities to give feedback on new products
- If you have subscription options, target this group to subscribe and save
- Give first-dibs on limited edition product releases
Loyal
- Target with SMS if they aren’t already subscribed
- Target for mobile app download (if you have a mobile app)
- Offer buy-one-get-one-free
- Strategic cross-sell opportunities on higher value products
- Opportunities to give feedback on new products
- Send them surveys, invite them to personal meet-ups or exclusive events
- Target this group with your referral program, encourage them to spread the word
- If you have subscription options, target this group to subscribe and save
Recent
- Cross-sell related products using dynamic product feeds in emails
- Ask them to leave product reviews
- Offer an incentive for them to make another purchase
- If you have subscription options, target this group to subscribe and save
- Use targeted on-site forms to promote your loyalty or rewards program
- Target for SMS and mobile app download
Needs attention
- Offer a free trial of a new product or another incentive to re-engage them
- Utilize prior feedback or purchases to highlight NEW, different, and better features
- Location-based targeting that says “come into the store and redeem this offer”
- Use webhook to send direct mail to their mailing address
- Retarget this segment through Meta or Google to recapture attention with social proof ads
At risk
- Send a targeted winback campaign with an incentive to re-engage
- Offer a limited-time promotion or coupon
- Use webhook to send direct mail to their mailing address
- Retarget this segment through Meta or Google to recapture attention with social proof ads
Inactive
This group is a collection of low-value customers who have lapsed and are highly unlikely to purchase again.
While you can attempt to re-engage this group, it is not a good idea to spend a lot of time or resources trying to reactivate this group. You may also want to consider segmenting this group out of your email communications since they are unengaged and unlikely to open or click on your emails.
How can I monitor how effective my retention strategy is?
In the next lesson, we’ll explore the intelligence section of Klaviyo Advanced KDP or Marketing Analytic's key analytics tools to identify drop-off points and enhance your strategy, ultimately boosting your ROI.