Offer an insight into the candidate’s application and why the company ultimately decided not to continue with the process. Being transparent will show that you are an honest employer who knows what it’s doing and that you indeed read and paid attention to their application.
Your qualifications and experience were (insert an adjective, e.g., impressive, outstanding). More specifically, we were impressed with (insert the candidate's skill) and (insert the candidate's skill).
However, we found there was a lack of [Sender.Company]'s (required skill), [Sender.Company]'s (required skill), and [Sender.Company]'s (required skill), skills that, for the moment being, we consider a minimum requirement for this specific role.
We would still love for you to be a part of [Sender.Company]. You have the potential to be a great asset to our company, and the door is always open if you ever decide to apply for any open positions in the future.