Building a customer engagement strategy is essential for brands to be relevant in 2023.
Why this matters:
In today’s dynamic digital landscape, brands must create engaging customer experiences and ensure customers feel valued. Brands must also be agile in their approach—constantly adapting to customer demand and preferences changes.
The best way to talk about customer engagement is to share a personal example of a brand experience. And while this example started with a Google search, it has nothing to do with digital marketing campaigns, social media channels, customer service, or an online brand experience. Nothing.
A few years ago, my wife and I decided to switch banks. We had been with the same credit union for over a decade, and we’re looking for something different. Plus, we moved to a new town and wanted to meet people in our community. So we tried to find a local bank that employed people that lived in the same city as us and would hopefully be more engaged with us as customers.
We researched Google and found a local bank almost within walking distance. We visited the branch and were impressed with the personal service we received from the employees. When we walked in the door, we were treated almost like royalty. One employee was just about ready to make a Starbucks run and asked if we wanted anything before he stepped out.
They took the time to get to know us, asked about our needs, and made account recommendations based on our answers. We also liked that this bank was community-oriented and supported local businesses.
We decided to open an account and have been extremely happy with our decision. The bank has continued engaging us by providing valuable information such as saving money on groceries, hacks to reduce monthly expenses, and helpful information about the financial market, inflation, and interest rates.
They’ve also invited us to a few local events, the farmers market, and happy hour, where we had the opportunity to meet the staff and get to know the branch manager more personally. He even remembered that I’m a Lakers fan, my dog’s name is Bailey and even the neighborhood where I grew up. Personalized service, a friendly smile, and “being present” can go a long way. This is how to increase customer engagement and brand loyalty.
I know. This seems like an old-school example of customer engagement. It is. But it’s a memorable customer experience like this, and I am not shy about telling others about it. Brands must replicate this customer engagement approach at every touchpoint, online and offline.
The best way to help you create a customer engagement strategy is to understand what it is and why it’s essential.
What is Customer Engagement?
Customer engagement is building customer relationships based on trust and mutual respect. However, the foundation of this relationship must be grounded in transparency, communication, and shared brand values. If there is a disconnect between customer and brand values, customer engagement and brand marketing programs will not work.
Brand engagement involves creating opportunities for customers to interact with your business, listening to their feedback, whether good or bad and responding to their needs promptly. It also consists in anticipating customer needs and being proactive in providing solutions.
Customer-centric companies are creating strategies for brand engagement through social media channels, landing page experiences, email marketing, branded communities, in-person events, and any other spaces where they can engage customers.
Why is Customer Engagement Important?
The simple answer is that customers have choices. It’s that simple.
Apple, Amazon, Google, and other similar brands are the exceptions. For everyone else, you have to work extra hard to attract and keep customer attention and build a brand engagement strategy that considers the entire customer experience and their path to purchase.
Investing in customer engagement strategies is a wise business decision. According to Gallup, a fully-engaged customer will generate 23% more revenue than a customer who feels less connected to that brand. And companies with high customer engagement experience a 91% retention rate, compared to just 33% for companies with low customer engagement.
On the other hand, 96% of customers are likely to stop doing business with a company due to poor customer service. 96%!
Customer engagement is essential because it helps you create an emotional connection with your customers. Customers who feel engaged with your brand are likelier to become brand ambassadors and recommend your business to others. In other words, they buy more and tell others about their experience.
How to Improve Customer Engagement
You’ve got a compelling product and a functional website. Still, you’re not experiencing the customer engagement you anticipated. You’ve probably overlooked a critical aspect of the business – your customer engagement strategy.
Engaging with customers isn’t a one-time event; it’s an ongoing process. It starts from when they discover your brand until long after they purchase. This continuous interaction forms a bond between the customer and the brand, influencing their decision to repurchase, recommend, or defect.
One of the potent tools to boost customer engagement is social media. However, it’s not enough to merely have a social media presence. Instead, a robust social media strategy is essential for active customer engagement marketing. Brands must create captivating content, interact with their followers regularly, address concerns promptly, and encourage user-generated content. In addition, this strategy nurtures a brand-customer relationship that fosters loyalty.
Leveraging personalization is another effective way to improve customer engagement. Customers crave a personalized shopping experience. They want brands to understand their preferences and offer products or services that cater to their needs. A well-executed customized marketing strategy can lead to more customers purchasing and being satisfied with their experience.
In addition, the incorporation of loyalty programs can significantly enhance customer engagement. These programs reward customers for frequent purchases, encouraging repeat business and creating a solid bond between the brand and its customers. Furthermore, customers who benefit from these programs are more likely to promote your brand, resulting in free word-of-mouth marketing.
A customer engagement strategy is not an optional aspect of doing business. It’s the backbone of any successful brand. It’s not about getting customers to buy once but about turning them into brand ambassadors who champion your products or services, boosting customer engagement, and enhancing their experience.
Emphasizing customer engagement can improve your bottom line and create a community around your brand, ensuring longevity in a competitive marketplace. The time to invest in your customer engagement strategy is now. Make your customers feel valued, appreciated, and engaged. They are, after all, your most significant asset.
Understanding and Segmenting Your Customers
Customer engagement marketing begins with understanding your customers and their needs. You can conduct customer surveys, focus groups, interviews, social listening, research methods, and customer engagement metrics. Once you understand your customers and what they want, you can develop digital customer engagement marketing campaigns aligned to each customer group.
Here are a few different ways to categorize your potential customers:
Researchers: These customers aren’t quite ready to buy. They may interact with your brand on social media and subscribe to your newsletter but are not prepared to make a purchase. They are still in the research phase and likely to engage in the future. These customers want value and information.
Bargain Hunters: These customers are always looking for the best deal. They may visit your website but quickly leave if they don’t find what they want. They don’t want to engage with your brand and won’t purchase unless you provide the best deal. They are also likely to compare your product directly with your competition. These customers spend hours and hours scouring the internet looking to save 50 cents. If your loyalty or (rewards) program offers great discounts and other perks, this might be a good time to introduce this program.
New Customers: They have just made their first purchase but are trying to understand how to use your product. They may be unaware of your complete product portfolio and are interested in learning more. These customers want to be educated about your product and how it can solve their problems. They are not yet loyal to your brand, so it’s smart to focus on building customer relationships with this group by providing valuable content and superior customer service. They will likely be likely to engage on social media and through marketing brand engagement programs.
Highly Engaged Customers: Existing customers already familiar with your product and service. They have a need you can fill and will likely buy from you again. In addition, they want to be engaged with your brand through social media, email marketing, and various brand engagement campaigns.
Lapsed Customers: These existing customers used to be engaged with your brand but no longer buy from you. There could be many reasons why they stopped buying your products, such as pricing, quality of product, change in needs, or competition. You must re-engage them by understanding what made them stop buying from you and addressing those issues. This group is ripe to be invited into a customer loyalty program.
Loyal Customers: These customers are already familiar with your product and trust you. They buy from you again and again and refer their friends. They are engaged customers who will evangelize your products and brand without asking them to do so. They will most likely participate in a customer loyalty program and be forthright at providing valuable customer feedback.
Repeat Customers: These customers have already made a purchase and will likely buy again. They may not be engaged with your brand outside of the purchase. You can increase customer engagement with this group by introducing them to your loyalty program, sending them follow-up emails after purchase, and providing excellent customer service.
Problem Customers: These customers are unhappy with your product, service, or company. They may have had a negative experience or may not be happy with what you offer them. They are vocal on social media and often leave bad reviews. You can attempt to engage this group, but it may be difficult to change their opinion. You will need to listen to their complaints and address their issues.
Once you have categorized your potential customers, it’s time to start creating your brand and engagement strategy, which begins with understanding the customer purchase journey.
What is the Customer Journey?
The customer experience journey is a customer’s process when interacting with your brand. It starts with the first time they become aware of your product and ends with either becoming a loyal customer or choosing a competitive product.
There are different stages that customers go through during the sales journey, and it’s important to know what those stages are so you can better engage with them.
There are five stages of the sales funnel are:
- Awareness: The customer first becomes aware of your product or service. They may see a paid ad, hear about it from a friend, or read an online review.
- Interest: The customer learns more about your product or service and what it can do for them.
- Evaluation: The customer compares your product to others and decides if it fits them.
- Purchase: The customer buys your product or subscribes to a service.
- Loyalty: The customer becomes loyal and continues to buy from you.
It’s important to remember that not all customers will go through all five stages, and some may move back and forth between them. Some may even skip a stage. The point is that customers are dynamic, and they buy products on their terms. As a result, many marketers prioritize the purchase phase of the customer journey. However, several studies support then brand loyalty drives higher customer lifetime value.
Knowing which stage your customer is in will help you better engage with them and provide them with the information they need to make a purchase.
The best way to improve your client engagement strategy is to be very specific with each customer and at each phase of the journey so that every customer interaction feels genuine and authentic.
It’s also a best practice to always ask for customer feedback throughout the journey using customer insights platforms like Qualtrics or even something as simple as a poll on social media. Engaging customers consistently as they navigate the digital ecosystem is a marketing strategy that can pay huge long-term dividends. This will improve customer engagement and turn loyal customers into raving fans.
How to Create a Customer Engagement Strategy
If you’re like most marketers, you’re always looking for new and innovative ways to reach a target audience and engage your customers. But coming up with a customer engagement strategy that works is not that easy. The following is a proven five-step process for building a consumer engagement strategy that will put you above your competition.
In this process, one thing to consider is that your marketing strategy should focus on improving customer relationships and creating brand advocacy. This should include customer acquisition and engagement programs with your existing customer base. Keeping that focus will ensure that your marketing strategy will be grounded in a “customer first” mentality when you create these programs.
The first step is to understand what customer engagement means for your business. What are your business and marketing goals? What are you trying to achieve? Is it increased sales, customer engagement, loyalty, growing an audience on social media, or better customer retention rates? Once you clearly understand what you want to achieve, you can develop specific tactics to help you reach those goals. Tactics include social media engagement, email marketing, in-person events, and more.
The second step is to create a customer journey map. A customer journey map visually represents the customer’s journey from beginning to end. It includes all the touchpoints where customers interact with your brand online and offline. By understanding the customer’s journey, you can identify areas where you need to improve the customer and brand experience and places where you’re excelling.
The third step is to create an effective customer engagement strategy for each stage of the buyer’s journey, almost like a plan within a plan. This will vary depending on your business and marketing goals. For example, if you want to increase sales, your strategy might focus on lead-generation programs. On the other hand, if you generate brand awareness, your strategy will be PR and earned media.
The fourth step is implementing your customer engagement strategies and tracking the results. This is where most businesses fall short. They develop creative customer engagement ideas but don’t follow the results to see if they work. By tracking the results, you can determine which strategies are working and which need to be tweaked or abandoned. A few customer engagement metrics include customer engagement rate, lifetime value, and net promoter score.
The fifth and final step is to improve your customer engagement strategies continually. Your customer engagement metrics will change as your business and marketing goals change. The tactics you used last year might not work this year, so you need to constantly evolve and adapt your customer engagement strategies, to keep up with ever-changing customer needs.
Don’t Forget About Customer Loyalty Programs
A customer loyalty program is one of the best ways to engage your customers. It’s a way to reward your customers for their loyalty and show them you appreciate their business. There are many customer loyalty programs, but the most common is a points-based system where customers earn points for every purchase. These points can be redeemed for discounts, free products, or other perks.
Another type of customer loyalty program is a tiered system where customers are placed into different tiers based on their spending habits. The higher the tier, the more benefits and perks the customer receives. This program encourages customers to spend more money to reach the highest tier.
The airline industry is an excellent example of using a loyalty program to engage customers. For example, Southwest Airlines has a Rapid Rewards program where customers can earn points for every dollar they spend on Southwest flights. These points can be redeemed for free flights, upgrades, Wi-Fi, and more. Being on the A-List is a great feeling of superiority as a current customer.
American Airlines has a similar program called AAdvantage, where customers can earn miles for every flight. These miles can then be redeemed for awards such as free flights, upgrades, and gift cards.
What Value Does Data Provide to Customer Engagement Strategies
The role of data in devising and implementing customer engagement strategies is invaluable. Its transformative potential lies in its ability to drive decision-making, optimize customer interactions, and streamline the customer journey.
Firstly, data provides insights into customer behavior. By analyzing purchase history, browsing patterns, and customer feedback, businesses can glean a wealth of information about customers’ wants, needs, and preferences. This empowers brands to craft personalized marketing campaigns and product offerings that cater to the individual customer, thereby driving engagement and fostering brand loyalty.
Data also allows for segmentation, for example, enabling businesses to categorize their customer base into distinct groups based on shared characteristics. Segmentation can aid in delivering targeted marketing initiatives, ensuring that messaging resonates with the intended audience. In addition, this approach can drastically increase the likelihood of customers engaging with the brand and, in turn, purchasing.
Moreover, data can assist in predicting future customer behavior. Using predictive analytics, businesses can anticipate upcoming trends, identify potential customer churn, and proactively take solutions to address these issues. This improves customer retention and enhances the customer experience by ensuring their needs are met even before they realize it themselves.
In addition, data enables continuous strategy refinement. By measuring customer engagement metrics, businesses can assess the effectiveness of their current marketing strategies. Are customers responding to a new social media campaign? Are personalized product recommendations driving sales? These insights allow businesses to fine-tune their strategy, discard what isn’t working, and double down on successful tactics.
Lastly, data can be leveraged to evaluate and manage customer satisfaction, a critical factor influencing customer engagement. Surveys, reviews, and feedback provide firsthand information about customers’ experiences and sentiments toward the brand. Brands can utilize this data to improve their offerings and resolve issues, demonstrating to customers that their feedback is valued and acted upon.
Building a Customer Engagement Strategy Starts Internally
An effective customer engagement strategy is far from being the sole responsibility of the marketing department. Instead, it’s the lifeblood that permeates every aspect of successful brands. Those brands that stand out, boasting innovative products, a loyal customer base, and steady profitability growth, consistently adhere to a “customer-first” ethos.
The inception of this customer-centric culture originates from the company’s leadership and gradually disseminates through every layer of the organization. It’s not merely the domain of customer-facing roles; it encompasses everyone from the CEO to the receptionist. Each individual is tasked with providing an exceptional customer experience that surpasses expectations and encourages continued engagement.
Cultivating such a pervasive and transformative culture is an ambitious endeavor. It’s not an immediate transformation that occurs at the flick of a switch; it’s an investment of time and sustained effort, evolving gradually. The journey may be arduous, but the fruits of this investment pay dividends in customer loyalty, brand reputation, and, ultimately, profitability.
Creating an impactful customer engagement strategy may seem daunting, but with the proper guidance, it is entirely achievable. By adhering to these five comprehensive steps, you will be well on your way to crafting a robust customer engagement strategy that elevates your business to unprecedented heights.
- Step 1: Champion a customer-first culture from the top down.
- Step 2: Invest in comprehensive employee training to ensure customer satisfaction at all touchpoints.
- Step 3: Leverage customer data for personalized experiences and product development.
- Step 4: Integrate customer feedback into your operations and offerings.
- Step 5: Monitor and adapt your strategy based on customer behavior and market trends.
By following these steps, you’ll formulate a strategy and foster a culture of customer engagement, transforming your organization and driving your business toward unprecedented digital success.
Q: What are some good tips for increasing customer engagement?
A: Some good tips for increasing customer engagement include providing quality customer service, creating valuable content, and hosting engaging events.
Q: What is customer experience?
A: Customer experience is the customer’s overall impression of your company based on their interactions with your company or brand. This includes everything from the product or service itself to the customer service experience.
Q: How can I improve my customer’s experience?
A: There is no one-size-fits-all answer to this question, as the best way to improve customer experience will vary from company to company.
Q: How is customer engagement different than customer retention?
A: Customer retention is long-term and is focused on keeping customers around for the long term, while customer engagement is happening presently
Q: Should I engage unhappy customers?
A: This is tricky, as you don’t want to upset unhappy customers further. However, engaging customers is essential regardless of their feelings about your company. If you engage them correctly, you never know which unhappy customers might become loyal advocates.
Q: How do you know which customers to engage?
A: Analyzing your customer data and general metrics is the best way to determine which customers to engage. This data can tell you which customers are most likely to churn, which customers are the most engaged, and which channels they prefer for engagement. Reviewing your engagement metrics will help determine what’s working and what’s not.
Q: What are customer satisfaction scores?
A: Customer satisfaction scores are a metric that measures how happy or satisfied customers are with your product, service, or brand. There are several ways to calculate customer satisfaction scores, but the Net Promoter Score (NPS) is the most common.
Q: How can I use customer engagement to improve my customer satisfaction score?
A: The two are directly related – the more engaged your customers are, the higher your customer satisfaction score will be. Improving customer engagement should be a top priority to improve your customer satisfaction score.
Q: What are some common customer engagement mistakes?
A: Common customer engagement mistakes include neglecting to engage customers, engaging customers incorrectly, and failing to analyze customer engagement data and metrics.