Developing a Customer Engagement Strategy

Customer engagement is probably the first lesson I learnt in my professional career. In 2004, I started a small business to manufacture aluminium frames for computer embroidery machines. My father used to operate an embroidery unit at the time, and the inspiration to build these frames originated from the requirement in his business. We developed and tested the product in-house and, since we knew many machine sellers and machine owners in the city, we set out to sell (not market) the product to other potential users.

However, the product did not perform as expected. While everyone agreed with the utility of the product, we hardly had early takers. And the few orders we received were full of complaints. Since the product was developed to fulfil an internal need, we didn't have huge investment in this new frame manufacturing business and thought of closing it. But I had noted every feedback received from the early customers and sat down to understand the reason for our business failure.

1. Product was heavy. I will bluntly say that most of the machines in the industry at the time were made in China, which used to cost a fraction of the machines that were made in Japan. These made in China brands were excellent in terms of investment amount and return on investment. However, these machines were prone to overheating under heavy load.

2. Customisation. We noted that people were complaining that our frames did not fit their machines. We further noticed that, many times, even if two machines were made by the same brand, they were not of same size. Hence, the industry required immense customisation and every order needed to be build-to-order. As a side benefit, we also eliminated all finished goods inventory and moved to just-in-time production.

3. Repairs. This was again a major concern of our potential customers. A reasonable warranty and low cost of consumables would put them at ease about making this investment.

Acting on the above feedback, we made the business viable. Moreover, I kept a detailed record of every order we fulfilled; due to which, serving repeat orders and repairs became super quick. None of this would have been possible without customer engagement.

What is customer engagement?

Very simply, customer engagement is building a long-term relationship between a customer and a brand.

Importance of customer engagement

As evident from my example above, customer engagement helped us:

1. develop a product that served our customers' needs,

2. optimise our processes, and

3. provide superior service to our customers.

Nowadays, our purchase behaviours are increasingly influenced by our emotions. Personally, about 50% of the times, I go to my usual brands to make new purchases without even considering the competition. At my previous jobs, I have noticed that loyal customers generate on an average 25% more revenue.

Loyal customers are also an excellent source of feedback. Their attachment to the brand allows the business to seek feedback and opinion about various matters.

Show me some examples

Following are all examples of customer engagement. Let's see how many you can relate with.

1. Various business accounts we follow on Instagram. E.g. Netflix, celebrities, local businesses, etc.

2. "How would you rate your experience today?" link you receive after you complete a purchase (mostly for online sales but now for offline sales as well)

3. "On a scale of 1 to 10, how likely are you to recommend our services to your friends and family?"

4. Personalised discount coupons that are automatically printed with our bill at the departmental store

5. Messages and calls we receive to participate in surveys

Problems with Customer Engagement

There are two issues that I can think of as problems with the way businesses are engaging with their customers.

First. Once a fun and engaging activity, customer engagement, nowadays, has started to feel mechanical and purely process driven (both for the business and the customer). E.g. for a few weeks now, every time you complete or stop a navigation in the Google Maps app, you see a request to rate your navigation experience. I am morally obliged to provide feedback every time I see such requests. However, after a while it has started to annoy me. It takes up screen space on my mobile and it pops up every time I hit STOP. I can imagine that one reason for this is that Google wants to get feedback on every App update it pushes. If many customers start reporting dissatisfaction right after their App is updated, then Google can quickly investigate the update and sort out the issue. However, from the customer point-of-view, it may be easy to lose interest in providing feedback than developing an engagement with the business.

Second. Many businesses treat customer engagement as purely a sales and marketing activity, with an objective to convert customer into sale. It starts when a customer shows interest in the product and becomes a lead for the business. Marketing then hands off the lead to sales, which engages with the customer to answer their questions, help them navigate through the sales process, offer personalised discounts, etc. This is a narrow approach. Customer engagement should be a continuous process with all departments involved rather than just sales and marketing.

Developing a Customer Engagement strategy

Customer engagement is not a one design fit all strategy. Every business will have to design its own customer engagement keeping in mind its intentions and objectives. Below I have listed a running list of activities that can be part of the customer engagement. A business would have to craft a strategy depending on its scale, age, and volume. Naturally, it shouldn't try to do everything at once. I would rather do a few things well before taking on more.

Product Development

This is the most important avenue for customer engagement. Much money and effort are involved in developing a product that it is essential to consult the intended customer at every step of the way. This can be done through one-on-one meeting if it is an industrial product or a custom-made product. In case of mass market products, customer feedback can be captured through organised focus groups, commissioning qualitative and/or quantitative surveys, moderating long-term online forums, etc. We can also develop a prototype first and then reach out to customers for validation.

Sales Process

This is by far the most used and meticulously thought through process. For good reasons too. This is the process through which a business generates its bread and butter. Focus here is to provide as best an experience to customer as possible throughout the sales process.

A subset of customer engagement in the sales process is offering personalised offers, deals, or discounts. Many offer such deals based on the one-on-one conversation with the customer. Where the sales process is automated or online, the offers are either uniform for all or auto-populated based on the customer's purchase behaviour or history with the organisation.

Requesting Feedback

Throughout our day, we are constantly providing feedback to others. Just this week, I received the following requests to provide feedback:

1. A call from VW asking whether I am satisfied with my recent visit to their workshop.

2. An email from LinkedIn to complete a 3-minute survey to provide feedback on some new features.

3. A text message from a research agency I have used earlier to connect on phone, so they can understand our requirements in the post COVID-19 world.

4. A request from Audible to rate an audiobook I finished listening to.

5. A pop-up on my browser from my bank, to rate my satisfaction, when I finished an online chat with their executive to sort out an issue.

6. A pop-up on Google Maps app to rate my experience when a navigation was complete.

7. Feedback panel to rate my experience at the checkout console at the departmental store.

I am sure there are many more that I cannot recall at this point. We are so used to providing these feedback that we don't even realise that they are there in the first place.

We can request feedback at multiple touch points. They could be immediate through a pop-up, on the phone, or through a survey link shared in an email. The touch points and frequency of feedback requests would depend on the business requirement and desire to engage with customers. However, it could very easily get overwhelming for customers so any touch point should be tested internally through test cases and dummy respondents.

There are two further things I would like to mention here that I have noticed only a few companies do but I have seen satisfactory results from:

First, survey of new customers. We are so focused on providing a pleasant sales experience that that's all we talk about when we request feedback from a new customer. I have reached out to new customers and asked them specifically why they chose use over competition. Turns out customers do a lot of research before finalising their purchase, and sometimes, we are their final choice but with some reservations. The feedback thus provided is immensely useful to meet their expectations and be their first choice in the future.

Second, follow up communication after the survey. Anytime we participate in a survey, we receive a thank you, and then we are forgotten. Compare this with a scenario where you receive a follow up email saying, "Last month we asked you a few questions about our services. Your feedback allowed us to identify the following three areas for improvement: x, y, z. Going forward you will notice the following difference: a, b, c. Thank you for your feedback and we appreciate your continued support." This proves to the customer that their voice is heard, and the company cares to keep them informed. Nothing tops this as far as customers engagement is concerned.

Public Relations (PR)

Having a PR strategy is often expensive, and it makes sense once a sizable scale has been achieved. Many consider PR to be a play of words - how companies project their image to the public and promote narratives that supports their objectives. However, PR is a valuable component of customer engagement. A carefully crafted strategy would allow businesses to communicate with customers and create a positive brand association that no sales activity can match. Marketing campaigns promote products, which are often upgraded with newer features. There are only so many newer iPhones I can buy before realising I am chasing an endless upgrade. Now I wait out for my phone to die before I get the new features. I bought my current phone in 2016 but it was a 2015 model. While marketing has kept the product in my mind for 4 years, it has failed to create a positive brand association. This is where PR comes in. PR is not about a product, but about a relationship with the company, its values, and its culture. Consider the following example:

I was always fascinated by the excellent driving capabilities and safety of German cars. I was happy to buy a VW in 2015. However, the Dieselgate scandal that broke shortly afterwards left me embarrassed and angry to be associated with the brand. Mind you, nothing changed with the performance of my car or the service that was provided by my local dealership. India was so far behind in adapting the latest emission norms that the news hardly made anybody turn their heads. But I felt cheated and would not have recommended VW to any friends or family. Since then VW has come out with a series of rectifications and demonstrated strong commitment to emission control and development of electric vehicles. How do I feel about the brand now? Honestly, currently, I am neutral. The company's response has, to a large extend, controlled the damage. It's the PR which played a huge role in the way VW communicated with customers like me.

Another example of success PR is customer education. If you are a startup which developed a new product, PR comes in handy to share stories and utility of the product more than the marketing campaigns. Sharing stories help potential customers imagine themselves in similar situations and how the product may be of use for them. Hence, the long-term value of a PR is much higher than marketing campaigns.

Parting Words

The above examples are just the beginning. Customer engagement is a perpetual activity which requires consistent monitoring and adjustments. What a business chooses to do and how much it should do depends on a case-to-case basis. To close this article, let me summarise some major takeaways below.

Building customer engagement is building a customer-centric culture in the organisation. It's not an exclusive job of the sales and marketing, but all departments.

Data is extremely important. Even if it's not used immediately, any data generated about customer behaviour, preferences, etc. should be captured for future consideration. In addition to capturing data, a culture should be developed where information collected by any department is able to float to its right place.

Engagement is a two-way street. If you reach out to customers to help you with a survey, it would be nice if you can send a follow up message and information them the outcomes of the survey.

Lastly, but most importantly, pay attention to when things get overwhelming for your customers.

Finally, my turn to engage with my audience. If I missed anything or if you would like me to elaborate on any point, send me a message here, or leave a comment below. If you like this post, click on ❤ and share with your friends. Thank you!