In December 2014, Forbes published an article stating that “engagement will be the future source of customer loyalty.” 

Back then, Forbes was talking about ‘the future, something that will happen at one point in time, and it was a problem for future brand managers. 

Fast forward to today – no longer the future. 

It’s a well-known fact that engagement is one of the most powerful ways of creating customer loyalty (and growing your revenue). Therefore, customer engagement campaigns are a must in every striving business.

Check out today’s article to discover more about Customer Engagement as a concept, tips on improving it, and excellent examples of engagement campaigns coming from best-in-class global brands.

What Is Customer Engagement?

Customer Engagement represents the interaction between a consumer and your company, using different offline and online channels.

You’re creating customer engagement every time a customer contacts your business. This can mean leaving a comment on your latest ad, email marketing clickthrough rates, or face-to-face conversations between a shopper and your sales agents. 

In time, these interactions add up and create the customer experience that can make or break a brand.

As with any other piece in the Customer Lifetime Value puzzle, you want to create positive interactions with your customers. So listen to and act on customer feedback, and help them associate your brand with feel-good memories. 

Here’s where customer engagement marketing strategies come in handy. As opposed to leaving everything to chance and counting on human’s natural desire for interaction, you’re creating your own opportunities for building customer relationships.

Why Is Customer Engagement Important?

Positive customer experiences are the bread and butter of your eCommerce business. 

With positive experiences comes loyalty, improved customer retention, brand advocacy, increased Customer Lifetime Value, and an overall increase in your bottom line. 

Happy customers, happy business, right?

Of course, customer engagement is only a chapter in the story of your business, but an important one nonetheless. 

Customer engagement is vital for a variety of reasons:

  • It helps you better understand your customers. 

You can better understand your customer base when you track engagement across the customer journey. Their interests, needs, likes, and dislikes are in your data and customer behavior

  • It helps with problem-solving. 

Customer engagement is an excellent source of identifying the issues faced by your customers. When left unattended, these issues can become pain points, so treating them as quickly as possible is essential. 

  • Contributes to the customer success rate. 

When you measure engagement, you observe the periods when your customers go silent. Usually, this happens when they aren’t achieving the success they’ve been hoping for with your products. 

Noticing these gaps help you act quickly, fix the friction points, and deliver more positive user experiences. 

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Why Do You Need a Customer Engagement Strategy?

Considering the importance of customer engagement, you shouldn’t risk leaving it to chance. 

Your safest bet is to deploy a customer engagement strategy and use engagement platforms to organize random customer interactions into a straightforward plan. 

In this case, the customer journey map will include all customer activities – before and after purchase. 

Moreover, with a clear strategy, you can measure your progress and be mindful of all customer needs. 

Monitor the strategy closely to collect feedback and customer performance data to adjust your process – if needed.

Improve customer engagement by looking at the metrics and your Social Media stats. When customers don’t engage with your content, you didn’t yet find the golden ratio that turns marketing strategies into engagement opportunities.

How to Build a Customer Engagement Strategy

Like with any Customer [Something] strategy, it all starts with your genuine intention and interest in your customers. 

And like any other relationship, your Customer Engagement strategy must become with research and getting to know your customers. You can’t engage strangers, but you can engage people you know and appreciate. 

So, begin by gathering all the info you can about your customers, then use this data to build your Ideal Customer Profile

Don’t stop here – segment your customers into multiple groups based on their RFM score and their place in the Customer Journey. 

Different steps in the journey require different content. 

Prospects just getting acquainted with your brand need to be educated and reassured that you’re keeping your word and providing the value you promised. 

At the same time, long-term consumers need incentive programs, loyalty bonuses, and pricks that reward them for their loyalty. 

You can then use Social Media to address these customer segments and start conversing about your brand. 

A brilliant example of Netflix using Social Media to solve real problems while being relatable and down to earth.

Be warned, though. Suppose you start creating content strategies to engage your customers. In that case, you’ll need to be alert and answer all your customers’ comments or questions. 

Otherwise, it will seem like you’re not listening and don’t care about their feedback. 

You can also use social media to run promotions and giveaways. This is an excellent way to improve brand awareness and get more people interested in your products or services.

Bonus: Your engagement strategies will boost brand awareness since so many users are present and active on social media.

Try to be as genuine as possible – connect with your customers personally

The problem with the digital environment is that brands tend to treat their customers as cashflows and forget about the human element of it all. 

Consider your Customer Profile when making decisions about your strategies and come up with tailored ideas your customers will resonate with. 

Whatever you do, be genuine and sincere. People can sense if you’re being fake, or have ulterior motives behind your actions, so better don’t do anything if you aren’t going to be authentic. 

Just be yourself and speak to your customers naturally. 

The Benefits of Customer Engagement

There comes a time when you must ask yourself: “ok, but is this worth it”?

Let’s review some of the advantages of customer engagement and determine whether or not you should direct your efforts toward building a successful customer engagement strategy.

  • Customer engagement increases Customer loyalty. 

Usually, customers only have positive interactions with brands they love. Your loyalty programs are perceived better with high engagement, and retention becomes more accessible. 

  • You get priceless insights.

Talking to engaged consumers reveals valuable insights that help you improve your products, customer experiences, delivery options, etc. 

Customer Engagement vs. Customer Experience vs. Customer Satisfaction

If you’re new to the eCommerce landscape or didn’t give much thought to customer interactions, you might be slightly confused with all customer-related terms. 

Customer engagement mainly refers to constant contact with customers. Don’t limit here to product-related communication. Customer engagement is all about keeping a relationship with your customers.

Customer experience is customers’ general feeling/ impression after interacting with your brand. From the buying experience to product quality, everything that encompasses the relationship can contribute to the overall customer experience.

Finally, Customer Satisfaction measures whether or not your products meet customer expectations. With customer satisfaction, you determine how happy customers are with your products.

Customer Engagement Tips

Engaging customers might seem complicated, but when you think of the core concept, you realize engagement marketing is just a matter of understanding human behaviors. 

Yes, there are no one-size-fits-all strategies, but your customers are only humans after all – we humans share the exact core needs.

The closer a need is to the base of the pyramid, the more stringent that need is. So strategies that tap into humans’ innate need to belong, to be part of a community, to share good and bad news, etc., are sure-fire strategies. 

Tip #1: Use your customer data to share insights

While users are cautious when sharing their data and are also paranoid about sensitive information, you can use the data without breaching any privacy laws. 

Tip #2: Involve loyal customers in the decision-making process

A brilliant example of a customer engagement strategy comes from Electronic Arts and how they involve their community in their game production. 

For example, let’s look at the development of The Sims – the life simulation video game published by Electronic Arts.

Over the past 22 years, strong gaming communities formed around the game. The community managers at The Sims seized this opportunity to increase customer engagement. 

They approached the most prominent YouTubers and Streamers. They invited them to build lots and create storylines, later included in the official game patches. All users can share their creations in a dedicated Gallery. 

They can interact with each other and build relationships on the platform. 

While you may not necessarily have the resources to create global meet-ups or create customer engagement platforms from scratch, however, this shouldn’t stop you from involving your customers in your business development. 

For example, you can organize Social Media polls to determine the new look of your website or ask customers what they’d like to see from you in the future.

Engage your customers by involving them in your activities, connecting them with each other, and creating bridges between them.

Tip #3: Talk about your customers and their success

Remember that your existing customer is the absolute rockstar of your business. They hire your products for a job. When the job’s done, that’s a reason to celebrate. 

Add up the fact that people love success stories from people they can identify with – from their peers. 

When you see someone succeeding and identify with that certain someone, you picture yourself in the hero’s shows and envision your own success. 

People seek truth, trust, and realness. 

So now it’s your turn to seek customers with excellent product results and incorporate their stories into your marketing strategies.

Customer Engagement Examples

Spotify is an excellent example of using customer data to increase customer engagement. 

This music-sharing app uses data to offer personalized recommendations to its users and makes it fun. 

Besides people enjoying the data-driven suggestions, users also enjoy sharing their activities on Social Media. 

Every year, Spotify releases its Spotify Wrapped, allowing users to reflect on a year’s worth of activity.

Spotify users can learn more about their listening history through visualizations presented in an Instagram Story-type of format.

Listeners love sharing these stories on Social Media, exchanging music with their peers, and getting nostalgic when remembering certain songs.

Since we already mentioned The Sims earlier, it’s worth noting that the development teams regularly create polls, surveys, and contests over Social Media, allowing players to decide on the game’s future.

At the same time, they organize annual offline meet-ups for players to engage with each other, discuss with game developers, and generally celebrate their love for the game. 

So, what was once a silly game, transformed into a global phenomenon, creating communities of millions of players.

Customer Engagement Metrics

One of Omniconvert’s mantras is, “You can’t improve what you don’t measure,” – which is why we’re obsessed with data and metrics. 

So, you can’t correctly understand whether or not you’re deploying an effective customer engagement strategy if you don’t measure customer engagement. 

To avoid overwhelming you with data and KPIs, we’ve compiled a list of 5 must-watch metrics you should keep your eyes on. 

  1. Customer Lifetime Value

For good reasons, customer Lifetime Value (CLV) has become the North Star metric for many eComm businesses. 

CLV allows you to predict the total value the customer will bring to your business during their lifetime. In this context, lifetime means the time the customer will spend with your business. 

The longer he stays your customer, the higher chances are they will bring more monetary value to your business. 

Besides the monetary value, loyal customers are more likely to bring in new customers. 

When customer satisfaction is high, shoppers recommend you to their peers, so you get free word-of-mouth advertising. 

To calculate the Lifetime Value for each customer, you need to multiply the Average Order Value by the number of transactions AND the retention period.

LTV = Average Order Value × # of Transactions × Retention Time Period 

  1. User Activity

There are two ways to measure user activity:

  • Daily active users (DAU)
  • Monthly active users (MAU)

This metric shows how often users log into their accounts, share your content, or create new accounts (for referral programs). 

There isn’t an exact formula to calculate active users, so the safest bet for online businesses is to compare the daily and monthly active users. If there’s a severe breach between DAU and MAU, your customers aren’t sticking, and you’re dealing with the leaky bucket syndrome. 

The leaky bucket syndrome appears in businesses with poor customer loyalty. Hard-earned newly acquired customers are churning quickly, and you don’t see them again for a second purchase. 

It’s normal to see customers churning, but you have a problem when they’re leaving in bulk, and you lose more than you retain.  

Fortunately, you can quickly identify and rectify your issues with the following metric. 

  1. Customer Stickiness

Stickiness refers to the likeliness of a customer “sticking” to your brand with repeat purchases.

Effective customer engagement leads to more involved customers, which in turn leads to more loyal customers. 

Customer retention is cheaper than acquisition. Therefore stickiness reduces your marketing budget. 

Here are some factors influencing stickiness: personalized customer experiences, quick problem-solving, and general product quality.

  1. The Net Promoter Score

The Net Promoter Score (NPS) measures customer satisfaction with your business. 

It’s compiled of customer surveys, sent in two critical moments of the journey: pre and post-delivery

Generally, the most important question to determine your NPS is, “How likely are you to recommend us to your friends”?

Users give scores from zero to ten, ten being the highest. 

To calculate your NPS, you need to subtract the number of Detractors (users who gave a score between 0 and 6) from the number of Promoters (scores 9 and 10).

If you weren’t measuring NPS before, it’s high time to start now. The score allows you to be alert about your business health and highlights the problems inside your organization. 

Check out this ultimate guide on NPS and learn more about this metric and how to grow your business with effective customer insights.

  1. Customer Satisfaction Score

Customer Satisfaction Score (CSAT) measures the satisfaction level of the latest customer interaction with your brand. It might be completing an order, trying out a new feature, or talking to a customer care representative. 

Like the NPS, you send out customer surveys to get your CSAT, asking shoppers to rate their satisfaction and experience on a particular scale. Usually, the scale ranges from one to five, five being the highest.

Even if the execution is the same, you shouldn’t confuse the CSAT with the NPS

  • NPS measures customer loyalty, while CSAT is all about customer satisfaction.
  • CSAT is a crucial metric for positive customer relationships. 

To calculate your CSAT, you need to divide the number of satisfied customers by the number of survey respondents and multiply it by 100.

CSAT = # of satisfied customers ÷ # of survey responses x 100

Of course, you could monitor many other metrics to get a clear picture of customer engagement, such as:

  • Your Social Media Stats
  • The Bounce Rate on your Website
  • Website Pageviews

You decide what’s essential to grow your business and how you should approach it. It’s undeniable that the customer is the essential stakeholder inside your business, so the metrics illustrating their satisfaction with your business are crucial. 

Wrap-up

While this guide to customer engagement gave you a solid starting point, the ball will always be in your court. 

One-size-fits-all strategies don’t work in the long term since your customers are unique individuals, and you need to adapt to their behaviors. 

Keep in mind that people crave connection, clarity, and, ultimately, a happier life. These pillars should sustain the journey across the complete customer lifecycle.

In the age of lifecycle marketing, customer engagement plays an essential role inside your business – it helps customers form bonds with your brand, increasing loyalty and, in turn, increasing the overall value of your customers.

Be genuine in your intentions, quick on your feet with problem-solving, and flexible in adapting your strategies – the results will soon come. 

Good luck!

Frequently Asked Questions about Customer Engagement

What does Customer Engagement mean?

Customer Engagement represents the interaction between a consumer and your company, using different offline and online channels.

What is the Role of Customer Engagement?

Customer Engagement helps you build stronger relationships with your customers, increase brand loyalty, and, ultimately, earn more revenue and recommendations from your existing customers.

What are the 4 I’s of customer engagement?

Involvement – customers getting involved with your brand with store visits, website visits, etc. Interaction – purchasing, clicking on ads, leaving Social Media comments. Intimacy – happiness scores, feedback, blog sentiment. Influence – Shares on Social Media, recommendations, event invites.

How do you build customer engagement?

So strategies that tap into humans’ innate need to belong, to be part of a community, to share good and bad news, etc., are sure-fire strategies.