As more brands begin to take a customer-centric approach, an underutilized metric that can help measure success is customer engagement.
Customer engagement, and engagement level strategy, is holistic, working in tandem with customer lifecycles, and is directly tied to revenue. It encourages companies to understand that customers will engage with a brand at different levels over time. Post-purchase, understanding customer engagement is crucial for developing targeted customer lifecycle marketing campaigns that can stimulate and foster the brand-customer relationship.
Although there are subsets of each, customer engagement typically falls into three primary buckets: high engagement, low engagement, or disengagement. Data tells us that there is a positive correlation between customer engagement level and the type of customer they are for that particular brand.
High Engagement: At this juncture, the customer is excited and engaged and can be encouraged to stay at this level if they are continually provided with the right content, through the right channels, at the right time. The right content can be defined as relevant content, benefits, and timely offers.
Low Engagement: Low engagement can come in two subtypes. At the first, a customer is not interested – organic disengagement – for reasons beyond the brand’s control. Here’s a simple example: You’re a pool supplies retailer and after the that winter we just had, customers in the Northeast are not thinking about their pool. The other type is disaffected disengagement, where the customer is temporarily unhappy for a reason that can be remedied through the right offer or interaction. For example, maybe a customer has neglected to do business with the fashion retailer because of a credit card issue. A quick outbound call from a store associate or the content center, or a relevant email, can win the customer back.
Disengagement: This is when the customer is bored, unhappy or being nagged and chased away by an overly high frequency of emails or tweets. At the beginning “high engagement” is marked by digital dialogue, multiple touchpoint awareness, social recommendations, website visits, and, perhaps most importantly to the business, transactions.
Over time, customers can possibly drift to lower engagement and then, if not attended to, on into disengagement. From here the customer can easily slip into Lost, which does not help the business, especially when the customer lost is a former Best Customer.
The longer a company can maintain the highly engaged customer the more significant their lifetime value (LTV) and their contribution to the bottom line will be. Low engagement is a signal that the customer should be a high priority for the company, especially if they are showing the propensity to be, or if they're already are, a valuable customer. Once a customer enters disengagement it is almost impossible to win them back, but then again, a company may not want to win them back if they do not have the potential to become a valuable, profitable, good customer.
Companies must know who their customers are and understand what these customers want to do. By understanding the customer’s wants, needs, and actions, along with their segment’s persona, a marketer will have a framework of understanding that should enable them to know what the next most likely steps are that a customer will take while moving forward along their engagement lifecycle. Ultimately, this helps marketers sustain customer engagement and keep them from falling into a stage of disengagement.
Now that we have addressed the different engagement levels that customers can have along their lifecycle, stay tuned for my next blog post, which will focus on engagement level lifecycles in action.