Researchers have found that people's attention spans have significantly diminished over the past few decades, mainly because of all the digital distractions we're bombarded with daily. It begs the question: how can businesses compete for consumers' attention when they're already dealing with a plethora of notifications, content and marketing communication from countless other brands and direct competitors?
Implementing a customer engagement strategy can help your business cut through the noise and get your audience to focus on your brand, messaging and the content you're putting out. More than that, it can encourage people to actively reciprocate and respond. This article provides a detailed guide on the benefits of customer engagement, plus five tips to help you devise a strategy that'll get stellar results. Let's dive in with an explanation of what customer engagement means.
What is good customer engagement?
Customer engagement is about grabbing and holding your customers’ attention and encouraging them to interact with content or communications from your business. The end goal of a successful customer engagement strategy is to build a loyal, long-term customer base. To get there, you must nurture customers at every step of their buying journey (even before they make their first purchase!).
Typically, there are six stages of customer engagement or interaction, which map out the different phases of the customer journey.
First interaction – the point where you make your target audience aware of your brand through direct and indirect marketing campaigns (SMS messaging, email, social media, website content, direct mail, etc.).
Building familiarity – the next stage involves regularly interacting with your target audience to help keep your brand front of mind.
Purchase – when your target audience converts into paying customers (in other words, when you can see the fruit of your engagement efforts).
Retention – getting customers to make repeat purchases, achieved through upselling and cross-selling marketing campaigns.
Loyalty – a crucial stage where buying from your business becomes a habit for customers. They know your offering inside out and may not require as much help or convincing to complete the buying process. Such customers will happily sign up for rewards or loyalty programs.
Recommendation – where satisfied customers spread the word to others about your business, thus helping you attract new customers organically at no cost.
Stages five and six are the ultimate reward – buyer retention and satisfaction – the bread and butter of any successful business. However, your customer engagement strategy shouldn't end there. Loyal customers need continual nurturing to extend their customer lifetime value.
Let's look closely at some key terms (a few of which are mentioned above) that play an important role either as a cause or effect of improved customer engagement.
Customer retention is a marketing metric that measures how many customers stay with your business over a long period of time. This prolonged customer relationship is built on regular positive interactions between your business and customers, leading to repeat purchases.
Brand loyalty is similar to retention in that it involves customers buying repeatedly. However, it goes way beyond that. A loyal customer actively prefers your brand over others without needing to make a product comparison or research reviews. They trust your brand will meet and even exceed their expectations. They'll not only give you repeat business but also happily recommend your business to others (without wanting anything in return).
Loyal customers will leave positive reviews on forums, TrustPilot or Google My Business to give confidence to potential buyers who are still undecided about your brand. And they'll also be more understanding and patient when problems arise, e.g., service downtime or a delay to their order.
Customer experience – or CX – refers to everything a business does to put its customers first as they make their way through their customer journey. CX covers four key components – brand, product, price and service, all of which should deliver a superior experience for customers.
Customer engagement is a direct response to the kind of CX you offer to your target audience. The better the experience you provide, the better engagement rate you can expect. So that customers enjoy interacting with your brand, ensure your engagement channels are user-friendly, seamless and easy to navigate.
Customer satisfaction is a metric that every organisation must focus on. It measures how happy customers are with your products and service. A satisfied customer will likely buy again from your business (leading to customer retention) and recommend you to others.
You can measure customer satisfaction using surveys and scaled ratings – and they can be as simple as a quick email or SMS poll with a question such as:
How satisfied are you with the service you received today? Reply 1 for very satisfied, 2 for satisfied, 3 for neutral, 4 for unsatisfied and 5 for very unsatisfied.
Using data insights from surveys and ratings, you can improve your products and services where necessary. Note, however, that customer satisfaction is just one part of your overall engagement efforts. It shows you how customers feel at a particular moment in time – even if satisfaction is high, it doesn't mean these customers will stay loyal to your brand.
Customer lifetime value
Customer lifetime value (CLV) is the total revenue a customer generates throughout the entire duration of their relationship with your business. This metric measures how much a customer has spent – or is expected to spend over their customer lifecycle. The higher the CLV, the more value the customer brings to your business through repeated spending and loyalty.
You calculate CLV by first working out a customer's average purchase value and multiplying it by their average number of orders. This gives you the customer's value. Then, multiply the customer's value by the average customer lifespan to provide you with the CLV.
Why you should focus on improving customer engagement
Customer engagement is crucial not only for customer loyalty and retention. It's essential for visibility and making your target audience aware of your brand's existence in the first place. You must get your audience to trust your brand enough to engage with it; otherwise, why would they buy from it?
Other reasons to improve customer engagement include:
More revenue and greater CLV – as this is what repeat buyers bring to your business.
Reduced customer acquisition costs (CAC) – retaining customers is much cheaper than trying to attract new ones when you factor in advertising spend and other marketing costs.
Useful feedback – which you can get from surveys, questionnaires and reviews to help you improve your product or services.
Higher customer satisfaction rates – which indicate whether your business is on the right track to delivering a superior customer experience.
5 top tips for building effective customer engagement strategies
There's much to consider when setting up a customer engagement campaign, including which communication channel to use, making sure the CX is top-notch, requesting feedback, monitoring customer behaviour and analysing the performance of your campaigns. Let's break these down...
1. Use multiple communication channels
Successful customer engagement involves reaching out to customers on channels and platforms they like to use – as this makes it easy for them to respond. The following channels are used by many organisations today:
SMS is ideal for short, time-sensitive messages such as flash sale alerts, appointment reminders and order confirmations. By setting up two-way texting, you can also use SMS to collect survey responses, provide customer support or entice customers to engage with competitions (e.g., text-to-win campaigns).
To get started with SMS, you must first choose a reliable SMS service provider and apply for a sender ID; a number or brand name that you can text from.
Email is best for sending long-form content that customers can read at their leisure, for example, a company newsletter or product tutorials. It's also good for seasonal promotions that run over a few weeks. With email, you can create beautiful templates to reinforce your branding and embed media files to grab attention and increase engagement.
Instant messaging apps
WhatsApp and Messenger are examples of instant messaging apps you can use to have rapid back-and-forth conversations with customers. This channel is excellent for answering FAQS and providing assistance, e.g., how to make a payment, when a product will be back in stock, etc.
Some customers want real-time human-to-human interaction with a business and will therefore make a call to get information or support. Phone calls can significantly impact the delivery of a superior customer experience as several factors come into play. For example, the length of time the customer must wait before their call is answered and how the support agent handles their enquiry. (A highly motivated and personable agent will provide a better experience than one who comes across as unenthusiastic or defensive).
Social media lets you showcase your latest offerings and provide business news to your followers, especially younger audiences like millennials and Gen-Z. You can encourage followers to engage by incorporating features like click-to-call or click-to-message within your social media post content.
Your website gives you an online presence that visitors can use to research your brand, compare prices, download resources, share information and buy your products (if you have e-commerce functionality). Increase customer engagement by ensuring your website looks professional, appealing and easy to navigate. Incorporate a chatbot to help visitors get their queries answered instantly.
In an ideal world, it's best to use an omnichannel strategy and utilise all the above channels. This way, you can reach the broadest possible audience via their preferred channels and even transition from one to another. For example, a customer may begin their enquiry via social media and then shift to email.
2. Work on providing a memorable experience
On all channels you use, aim to provide the best possible UX and CX to engage customers. Here are some quick tips for each of the above channels:
SMS – as texts are very direct, be mindful of frequency and sending times (don't overdo it or send at silly o'clock.) Always include a clear call-to-action that tells recipients what action you want them to take.
Email – write attention-grabbing subject lines, use a beautiful design and include interactive elements like videos or GIFs. Use the space available to tell a story.
Messaging apps – set up greeting messages and autoresponders for FAQs so customers get an instant response. Use the app's labels, notes and status tagging features to help you understand each customer's relationship with your business.
Phone calls – invest in training for customer support staff and incentivise them to help with motivation. Set response time targets and monitor regularly to ensure your business is on track.
Social media – post consistently at the times when your audience is most active online. Share valuable content, ask questions and use images, GIFs, videos and branded hashtags. Respond to mentions, comments and messages as soon as possible.
Website – make it effortless for visitors to find information on your website. Ensure the content is compelling, highlight customer testimonials, place strategic call-to-actions and improve mobile responsiveness.
3. Take feedback seriously
Be consistent with requesting feedback so that you can continually measure customer satisfaction. A simple way to do this is to send a quick SMS when you receive confirmation that a customer's order has been delivered. You can include a link and ask the customer to leave an online review and a rating out of five stars.
Get deeper feedback insights once or twice per year to ask how your business can improve its products and services. If you decide to make changes to your offering based on customer feedback, publicise this on your social channels, as a blog post or in your newsletter campaigns. Customers like to know you've acted upon their feedback.
4. Regularly review customer behaviour
Collect and analyse data on all customer interactions. This is important so you can understand how your audience is reacting to your engagement efforts. You'll be able to see which channels perform the best and lead to the most interactions and learn how your content is resonating with new and existing customers.
Increase the chances of customers noticing your engagement campaigns by personalising the content. Address them by name and tailor the messaging according to their customer journey stage. For example, with first-time buyers, you could thank them and include an incentive (e.g., a 10% discount) to use when they place another order with you. Or recommend a product that would complement one they've already purchased.
Measuring the success of your customer engagement strategy
As with any marketing strategy, it's essential to evaluate how well your efforts are working. Use the following customer engagement metrics to get an overall picture of performance:
SMS response rates – such as message open rates and opt-ins vs. opt-outs. If you see a spike in unsubscribes, this indicates a recent campaign has fallen short of expectations.
Email marketing analytics – open rates, click-through rates, opt-outs and replies.
Social media metrics – likes, follows, comments, no. of subscribers and post views.
Website statistics – monthly visitor numbers and website behaviour such as bounce rates, click rates, interaction with CTAs and which pages are visited most frequently.
Phone call statistics – how many customers pick up outbound calls, how many are willing to hold after they've initiated the call (and for how long), and how many disconnect the call before speaking to a live agent.
Initiated enquiries – the number of leads or customers who start a conversation with your business and for what purpose.
Net promoter score (NPS) – which measures customer loyalty and how likely customers are to promote your business to others.
Customer effort score (CES) – how much effort customers need to make to use your offering (the lower the effort, the more loyal customers are likely to be). This can be easily calculated with a simple survey where customers score their effort level on a 1-7 rating scale. You then add up the CES scores and divide the total by the number of responses received.
Customer engagement keeps your business front of mind
Building strong customer relationships is one of the key foundations of business success. The way to do that is through good customer engagement, starting from the very first interaction with your brand and even when you already consider customers to be loyal. It's a continual process.
Consider an omnichannel approach to customer engagement to meet your customers where they are. Focus on delivering a superior, seamless and personalised experience online and offline. Regularly ask for feedback and use some or all of the metrics outlined above to analyse customer engagement effectively. Use your data insights to make improvements or change the direction of your engagement strategy if needed.
Next, read how an SMS chatbot can help you make meaningful connections with customers.