What is customer engagement and why should you care about it?
How does Hashtag Loyalty help you automate your customer engagement?
In these digitally driven times, the customer has been more empowered than ever before. With customers deciding how and when they wish to interact with your business and thanks to a platter of options to choose from; it is essential for your business to stay relevant and fresh in their memory.
Wondering how?
Customer Engagement.
Owing to the ever-changing and growing customer expectations, we’ve noticed a paradigm shift; slowly but steadily push marketing is being replaced with engagement.
The term, customer engagement, has been widely spoken about and its varied definitions are result of the numerous interpretations of the same.
Despite the many versions of its meaning, what has been unanimous is its importance. It is not just a trendy flash word, it is the new marketing reality.
However, the plethora of articles available on customer engagement has often raised more questions than it answers.
In this post, we look to address each of these questions and touch upon everything related to customer engagement.
Why should you care about customer engagement?
As result of the new empowered customer, it is crucial to align your marketing efforts with their behaviour and expectations.
1. Customer options are diverse; it is required of you to stand out amongst these options.
2. Customer decisions are more informed; it is essential to cater to their sources of decision criteria.
3. Customers switch channels; it is crucial for a business to switch their communication across channels seamlessly along with the customer.
4. Customers are better engaged with personalisation; it is critical to personalise your communications to derive the most value.
Without further ado, let’s answer the impending question.
What is customer engagement?
Wikipedia defines it as;
“A business communication connection between an external stakeholder (consumer) and an organisation (company or brand) through various channels of correspondence.”
We at Hashtag Loyalty put it simply as;
“Every communication or interaction that a business initiates with its customer which contributes to improving the overall experience while fostering loyalty to the brand.”
What are the attributes of effective customer engagement?
Successful customer engagement communication comprises of relevant value proposition, to the target customer at the right stage of their lifecycle. These are derived from analysing the behavioural and purchase characteristics of customers.
Let’s look into each of these aspects more closely.
It begins with understanding the value proposition; it is the offer that a customer is most likely to resonate with.
For example; a customer visits a cafe for their daily fix of coffee, the communication to them can be an offer to upgrade their purchase of a coffee to a breakfast combo at a discounted rate.
Second, the probability of the communication to be highly effective is contingent on sending it to the target customer.
For example; recognised high spending customers of a bar are offered early bird access to tickets to an upcoming gig at the venue.
Lastly, engagement is highly effective when sent at a time the customer is most likely to respond to.
For example; customers of a waffle joint with upcoming birthdays are promoted to visit and celebrate with a freebie on their order.
Apart from the above, the probability of success of the engagement is significantly higher when the customer has been given the liberty to exercise their right to choice.
For example; customers earn points for their purchase at a brand which in turn can be used to redeem a reward of their liking.
Most importantly, engagement is most appreciated when it is human and caters to the underlying desire of each individual to be happy.
A simple engagement such as personalised seasonal greetings to customers or even a brand recall, goes a long way in ushering delight and drives loyalty to the brand.
How to calculate customer engagement?
While the concept of customer engagement is fairly easy to understand, its intangible nature makes it intricate to calculate its success.
However, customer engagement being a function of customers of your business itself, certain metrics help us gauge its performance.
Redemptions; active redemption of rewards is corroboration of the fact that customers are engaged with your business.
Purchase Frequency; an increase in the frequency indicates that customers are returning and engaging with your business more often.
Average Order Value; an increase in the average order size denote that customers are turning to your business for larger purchases owing to their loyalty.
Customer Lifetime Value; an increase in the LTV is translation of prolonged engagement of a customer and their commitment to your business.
Retention Rate; high retention and low churn is virtue of continued customer engagement.
How to automate customer engagement using Hashtag Loyalty?
Having discussed the meaning and aspects of customer engagement, we can safely conclude that it is a foundational pillar of success for a business.
But engaging each customer of your business that too personally and regularly is a mammoth task.
That’s where Hashtag Loyalty steps in.
Hashtag Loyalty enables you to understand your customers better by automatically segmenting them into categories as per their Recency, Frequency and Monetary characteristics.
Each stage of the customer lifecycle from New Users, to those At Risk, to the high spending VIPs are covered.
Setup automated customer engagement for each of these stages of the customer lifecycle.
Create a brand recall with simple informational or reward campaigns.
Communicate via a channel, Email or SMS, as per the customer’s preference.
Voila!
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