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Everything You Need to Know About Customer Engagement to Keep Your Customers Hooked

author
Dhawani Shah
Digital Marketing Manager
9 min read
Everything You Need to Know About Customer Engagement to Keep Your Customers Hooked

First things first. What exactly do we mean by customer engagement?

Well, it’s all about the ongoing relationship between brand and customer. Simply put, engaged customers keep coming back. They are even happy to recommend your business to others.

“Companies with the strongest omnichannel customer engagement strategies retain an average of 89% of their customers, as compared to 33% for companies with weak omnichannel strategies.”

And it’s not just that engaged customers recommend you, on the flip side, 91% of customers who had a bad experience would prefer not to do business with you again.

The two sides are inextricably linked. Great customer experience is absolutely central to customer engagement. Most organizations fail to understand what constitutes good customer experience. This means lower engagement rates and the inevitable loss of business. 

Consider the following statistics:

  • 33% of Americans consider switching companies after a single instance of poor service.
  • One negative experience is enough to persuade 51% of customers not to do business with your company again.
  • Americans share a poor service experience with an average of 15 people but only tells 11 people about a good experience.
  • Companies in the U.S. lose over $62 billion annually from poor customer service.

On the other hand:

  • A company with an annual turnover of $1 billion can boost its revenue by $823 million over a period of 3 years through better CX.
  • U.S. consumers are prepared to pay 17% more to transact with companies that deliver excellent service. Up from 14% in 2014.

Customer engagement a key component of customer experience

According to Gartner, "When it comes to making a purchase, 64% of people find customer experience more important than price."

Customer engagement is a key component of the customer experience. So, how can brands keep the customer engaged to deliver an excellent customer experience? 

Keeping customers hooked is definitely a challenge.

These days people browse rather than read. They want to skim through content, getting maximum value in time. Too much content, a cluttered look, no call to action. These can all turn customers away from your brand.

Attention spans are reducing. Consequently, the challenge of keeping customers engaged is increasing.  

A recent Microsoft consumer study claims the human attention span is only 8 seconds. This is significantly down from 12 seconds in 2000. A goldfish has an attention span of 9 seconds! 

What does customer engagement mean?

Hubspot defines customer engagement as “the ongoing interactions between company and customer, offered by the company, chosen by the customer.”

There may be slight differences in how brands choose to define customer engagement, but they certainly all agree to it involve loyal and lasting relationships. 

As much as two-thirds of a company’s profit may rely on effective customer engagement. Maybe that’s why a 2014 study by McKinsey & Company saw the C-Suite of various companies rate customer engagement as the top strategic priority for all business initiatives.

Highly engaged customers buy more. Fact.

Yet, most customer engagement strategies just prod the customers to spend more, forgetting to differentiate the brand from all the others out there. 

Brand engagement is more than simply the transactional value of relationships. Think deeper. Connect with your customers.

According to Deloitte, "Every consumer wants a different experience while shopping and that ‘experience’ has become the differentiating factor for many successful business models. 

However, businesses are finding it increasingly difficult to predict what consumers want as their expectations continue to change." 

Deloitte adds consumers are growing "less tolerant of brands that do not provide an easy and seamless experience."

 But how do you predict what your customers want from you?

It’s a good question. Fortunately, it has a straightforward answer. 

The key is understanding who your customers are. What they want.

Use existing information from CRM software to answer the following questions:

  • Who are your customers?
  • What are their preferred platforms on social media?
  • What activities do they enjoy?
  • What motivates them to purchase a product from you?
  • How do customers search for you?
  • What is their preferred payment mode?
  • Do your customers prefer a specific device over others?
  • What causes them to abandon their cart?

Answer these and you can start to predict customer behavior, setting on the path to delivering a more personalized experience. 

Use Google Analytics to gain important insights and better understand your customers. Demographics, preferred devices, the content they enjoy, bounce rates and the reasons behind them. Information like this helps optimize and segment your audience, the key to personalization.

Why is customer engagement important?

Customer engagement impacts the churn ratio

Engaged customers are less likely to stop transacting. Focus on boosting your customer engagement to reduce the churn rate. 

  • Start by identifying customers who are ready to churn. You can do this by analyzing your customer data to figure what stages of the journey most customers churn.
  • Next, you can send a short feedback form or survey to customers who have stopped interacting with your business to understand why they chose to leave.
  • Post-cancellation surveys are great to learn about churn but don’t wait for customers to leave to get to know them better. Regular CSAT surveys could help you analyze customer satisfaction and improve retention by showing what you are doing right, and what you are doing wrong.

Re-target customers about to churn by offering them personalized offers by email or phone.

Customer engagement impacts customer loyalty

According to Aimee Lucas of the Temkin Group, customer engagement is intrinsically linked to customer loyalty. 

The reason is simple. Loyal customers continue to engage because of the way your brand makes them feel. They enjoy the experience above and beyond simply the product or service that you offer.

You can calculate customer engagement with metrics such as purchase frequency, guest checkout rates, average order value, customer lifetime value, and churn rate.

Whose job is customer engagement?

More than half of the companies interviewed in one survey admitted having no formal customer engagement program in place. Moreover, 60% of these companies didn’t know how many customers they had lost over the past year.

Sounds bad right?

There’s more.

According to CMO Council, only 14% of marketers say customer-centricity is ranked high within their organization; while 11% of customers would rank customer-centricity highly within the organization.

There is cause for hope though. Forrester claims a 10% improvement in a company’s customer experience score can translate into more than $1 billion in revenue.

But whose responsibility is it to keep your customers engaged? 

Is C-Suite responsible for designing effective customer engagement strategies? Or are the conversational support staff needed to develop your company’s CX?

In reality, the whole organization plays a role. 

Organizational hierarchies are changing, and the roles and responsibility of your employees are becoming more dynamic. Every employee engages your customers on some level. 

Indeed, an engager can be anyone in your organization. They keep in touch throughout the customer journey, providing them the support needed to make the next step on their journey. There are no two ways about it, an engager reduces churn rate through their efforts. 

This example shows how to identify the ‘engager’ in your system by breaking down your customers’ journey: 

This is an example of a company who distributes x-rays machines across hospitals and clinics. 

Key elements of a customer engagement strategy

To develop positive brand-to-customer connections, you must understand your customers. We already discussed using existing customer data and Google Analytics to analyze your customers’ behavior. 

Once this is done, differentiate between types of engagement. The various elements forming the core of customer engagement are:

Brand engagement

Brand engagement is the "process of forming an emotional or rational attachment between a consumer and a brand."

It’s crucial. It can make or break your future relationship with a customer. Customer buying decisions are often guided by how they ‘feel’ about the way a brand treats them. 

Speed and personalization are the two cornerstones of engaging customer experience. Brands wanting to connect with customers must deliver on both fronts.

Product engagement

Engaging customers with a product could be, for example, a highly addictive game app like Candy Crush. Perhaps it is a budgeting app, or a to-do list requiring customers to revisit the product on multiple occasions. 

Whilst in the conceptualization stage, gather user feedback. Use it to shape development. Offer a beta version of your product or a freemium subscription.

Already got a product in the market? Then provide an engaging tool that complements your existing offering. For example, editorial calendar Co-Scheduler gives a free headline analyzer to clients.

Agent engagement

Agent engagement comes from an understanding between customer and agent. Engaged agents lead to engaged customers.

One study shows a very satisfied agent is twice as likely to meet key performance metrics, such as average handling time, customer satisfaction scores, and first-contact resolution rates when compared to a less engaged agent.

The same study also found multiple systems affect agent satisfaction. The customer support technology you adopt must be designed to improve both the agent and customer experience. 

Automating your customer support with an intelligent chatbot could save time and money by reducing your agents' workload. According to studies, 29% of customer service positions could be automated through chatbots, saving $23 billion for U.S. businesses.

Customer touchpoint engagement

Customer touchpoint engagement includes all online as well as offline interactions.

Online touchpoints, like live chat, hold the greatest potential for customer engagement.

According to Acquire, live chat is one of the best customer engagement options. Makes sense when you consider more than 30% of consumers find live chat more informative and helpful than emails and phone calls. 

An agent can better engage customers, providing real-time support with integrated technologies such as screen-sharing and cobrowsing. This can significantly improve CX. 

Clients adopting these technologies have seen:

  • 18% improvement in first call resolution
  • 14% reduction in call handling times
  • 10% reduction in total support calls

"Adding a human touch to your customers’ experience can help you distinguish your brand. Visual engagement tools, such as co-browsing and video chat, can help build an emotional bond with customers." – Venesha Brooks.

How do you develop a successful customer engagement strategy?

Successful customer engagement strategy means making a habit of solving customer needs. Known as the hook framework – a great customer engagement strategy comprises four elements – Triggers, Action, Reward, and User Effort.

Triggers

Triggers are steps prompting your customers to take desired actions. Email reminders for abandoned carts, discount coupons, onboarding messages, these are all examples of external triggers. Say you choose a dress on Myntra but don’t complete the purchase, in all likelihood you'll receive an abandoned cart email, probably including a discount coupon, urging you to buy.

Internal triggers connect with existing behavior and emotions. People take to Facebook when they are feeling lonely, for example.

Ask yourself the following questions:

  • What are the external and internal triggers that prompt your customers to use your product?
  • What are the different triggers for different customer personas?
  • Can you check whether these triggers are working or not?

Action

Action refers to interactions that lead to rewards. For example, in Google, you have to type in your query (action) to get the search results (reward).

Remember, actions are always taken in anticipation of a reward. If the action is too complicated or time-consuming, when compared to the value of the reward, your customers are likely to churn.

Reward

Reward your users across their journey. It's most important yet underestimated aspect of customer engagement. You can nurture customer loyalty through customized reward programs, offering extras to returning and long-term customers. 

Try tiered incentives to encourage customers to buy more right from the start. Referral programs offering your buyers incentive for inviting new customers can work well. The newly referred customers can also enjoy a bonus. A win-win situation. 

Customer Efforts

There are certain cases where customers put in the effort to engage with your brand. 

Card-linked offers or the cashback offered on Amazon Pay are good examples of this step. Here, customers are immediately rewarded with something valuable having engaged with your brand. 

Tracking customer behavior to boost engagement rate

Customer behavior analysis involves qualitative and quantitative measurement of customer interactions. For this, you need to breakdown your audience into personas based on common attributes. Next, analyze how each group interacts with your brand at various steps of their journey. 

By tracking the behavior patterns of your customers, you can understand their priorities and motivations, developing tailored engagement strategies that deliver results.  

You can look at specific attributes like lead source, location, browsing history, job title, Google in-market segment, etc. 

Knowing how users navigate through your product or site can help you improve the design. Consider using A/B testing for new product features.

The role of emotional intelligence in boosting customer engagement rate

Emotional intelligence forms the basis of a customer engagement strategy.

Customers buy your products because they feel good about buying those products. That feeling stems from how your employees treat them, your product quality, and even your brand’s culture.

Experts think customer experience is the prime differentiator for most brands today. It seems customers agree. That’s why they are ready to pay more for better customer experience.

Simply using the latest technology for real-time support is not enough. You also need emotionally sensitive, and intelligent agents to communicate with your customers. 

Everybody likes a little extra, be it attention, appreciation, or even a discount!

Remember to go the extra mile for your customers. It’s a great way to create meaningful relationships and turn customers into spokespersons for your brand!

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