What is Customer Engagement? All You Should Know

Customer engagement is a critical element of running a successful business. The business world has gone through many transformations from its inception to date.

Traditionally, the phrase “Customer is King” has been deeply associated with business transactions with customers. Customers are one of the most important (if not the most important) to every business, and it has always been the role of businesses to satisfy every need of their customers making sure the business goal of solving customer problems/pain points is achieved.

The concept of engagement has taken a new form with many new technological innovations in the business environment. Beyond just offering solutions to customers, businesses must do more for them by finding better ways to connect with them and engage them.

While the concept of customer engagement means satisfying every need of customers for some companies, others simply do it by treating them right, offering them amazing deals and discounts, etc. Irrespective of the approach you choose, the general idea behind customer engagement is to make customers keep coming back to you after sales.

Beyond a one-step process, customer engagement requires ongoing effort to genuinely connect with your audience, engage them and build lasting business relationships. In this article, we will take you through the steps, tips, strategies, and importantly, the business benefits of customer engagement.

Table of Content

• What is Customer engagement?
• Customer Engagement vs. Customer Satisfaction vs. Customer Experience
• What does Customer Engagement Look like
• Benefits of Building a Customer Engagement Strategy
• Types of Customer Engagement
• 10 Powerful Tips to Improve Customer Engagement
• Three (3) Key Steps to Customer Engagement
• Metrics to Measure Customer Engagement
• 8 Proven Customer Engagement Strategies
• Customer Engagement Tools

What is Customer engagement?

Customer engagement refers to the strategic interaction and growth of a healthy business relationship between a business and its customers.

Customer engagement as defined by Rohit Bansal & Dr. Kuldeep Chaudary in an international management research journal is the “emotional attachment that a customer experiences during repeated and ongoing interactions. Organizations who engage customers to the point where they are moved to behavioral change do so by exploring opportunities for emotional connections through ongoing, consistently positive experiences.”

Organizations around the world engage their customers by creating positive interactions and experiences that make them more aware of their product and brand as a whole to build trust with them and earn customer loyalty.

Customer engagement can start from the first time they visit your company website or social media page. It is a conscious effort to provide a great customer experience and get them emotionally attached to the company that they keep coming back to.

Some organizations engage customers by keeping in touch with them after purchase, while others do this by offering them great incentives, deals, and discounts or by simply making them feel valued and special through regular interactions. Whatever your definition of engagement is, it must be a way of improving customer relationships with your company.

Dimensions of Customer Engagement

The different dimensions of customer engagement include:

1. Longevity: This is the length of time that the customer interactions are spread across.
2. Proactiveness: This looks at the proactiveness of the customer – whether the customer chose to engage with the brand of their own accord without any activity by the brand.
3. Repetition and Frequency: This looks at whether the interactions are frequent and similar or sporadic and varied.
4. Context: This looks at the situation where the interaction happened, for example, post-purchase, before purchase, purchase consideration stage, or only when a promotion or incentive is going on, etc.
5. Volume: This considers the total interaction that takes place with a customer over their whole customer lifecycle.

Customer Engagement vs. Customer Satisfaction vs. Customer Experience

Although the concept of customer engagement, customer satisfaction, and customer experience are slightly similar, they are all different in their ways. We will talk more about this below:

Customer Engagement vs. Customer Experience

Customer experience is an all-encompassing brand process that uses marketing campaigns and other organizational communication strategies to create a positive business environment for customers that makes it easy for them to make a purchase.

In simple terms, customer experience (CX) describes everything that happens for a customer about the brand, from seeing the first ad of the brand on social media, its billboard beside the highway to its handout flyers across the city.

The ultimate goal of customer experience for brands is about putting themselves in their customer’s shoes and identifying ways to provide the best possible experience for customers across all touchpoints.

Customer engagement, on the other hand, is concerned with how the customer can be actively engaged with the company. Rather than being a mere recipient of an experience, customer engagement makes the customer an active participant. Customer engagement explores how customers react and respond, how they interact with your content and communication as well as their relationship with you. It is an integral step of the customer journey in the company.

Customer Engagement vs Customer Satisfaction

Customer satisfaction measures how much customers like their experience and engagement with your company and in most cases, is the final factor that determines whether a customer will return or turn a blind eye to all your communication with them.

Although customer engagement and satisfaction might involve similar processes to achieve a common goal – which is to increase customer retention and brand loyalty.

A satisfied customer might not ever be an engaged customer, as there have been cases where a frequent shopper at your store might not take part in the customer loyalty program because they just want to shop with you and not signup for any lifelong commitment with you. whereas an engaged customer might only make a few purchases with you but will be most active on your company’s forum and social media platforms.

This scenario shows clearly that customer engagement and customer satisfaction are very different concepts, that can affect customers differently. However, you must understand that customer satisfaction can become an outcome of customer engagement and can be actively engaging customers can become steps to making customers more satisfied.

What does Customer Engagement Look like

Here are a few examples of what customer engagement might look like in practice.

1. Making a Complaint

When a dissatisfied customer makes a complaint or gives feedback about a problem they want you to fix, it shows that they care enough about your company to take the time and effort to reach out to you to get the problem fixed for a better customer experience. Making a complaint shows that the customer is loyal to your brand and wants it to improve so they can keep doing business with you.

2. Responding to marketing campaigns on social media

What better way is there to engage your customer than seeing them actively interact with you on social media? An engaged customer seeing an ad for your product they recently bought may add a comment, like, or share the ad with their colleagues encouraging them to purchase the product. This act of brand advocacy can positively impact your business and help you gain more customers without spending more money from your end.

3. Participating in a loyalty program

A customer signing up for a loyalty card or app to collect points for future transactions with your company can be a clear indication of how engaged they are with your business. The thrill and fun of collecting points and achieving rewards becomes a secondary motivation in itself and can influence them to choose your brand over others.

4. Reviewing a Third-party Site

In contemporary sales practice, customer reviews are an important determinant of sales. A lot of people rely on reviews they read from others about your business to decide whether they want to do business with you or not. Your customer leaving a positive review of your company on third-party sites like Trustpilot, Google Customer reviews, Angie’s list, or ReviewCenter could be an indication of their loyalty to your brand.

5. Using your Online Support and Customer Service

A customer requesting support from your customer service or support specialist while using your product shows how interested and engaged they are with your brand. Your customers desire to solve their business problems with your product and request support in achieving that goal.

6. Customer Feedback, Suggestions/ideas for Business growth and improvement

Customer feedback on their opinion of your service and suggestions or ideas for your business growth and improvement can only be given by a customer that is actively involved with your business. Loyal customers take them to comment on your social media platforms, fill out surveys and contribute to your growth by offering their advice on what you can do better or giving you an eye-opener to things they care about that you are not doing yet.

Benefits of Building a Customer Engagement Strategy

An effective customer engagement strategy beyond increasing your sales can also help you achieve numerous business benefits that can support your lifelong goals and always keep you at the top of your customer’s minds. Here are some of the benefits of building a customer engagement strategy.

1. Improves customer relationships

Customer relationships are the backbone of every successful business venture. An effective customer engagement strategy is crucial to helping brands connect better with their customers in a way that makes them return for more business transactions.

It is also the way businesses can build sustainable, long-lasting customer relationships that drive business growth and profitability. Taking the time and effort to engage customers across multiple channels and touchpoints and solving their business/personal needs or pain points, can help build meaningful relationships with them.

2. Improves customer retention and churn rate

A customer engagement strategy can help you develop working strategies on ways you can continuously engage your customers making sure your relationship with them doesn’t end after purchase, but keeps them coming back for more purchases. Existing reports have shown that a 5% increase in customer retention can significantly increase business profits by 25%.

Similarly, an effective customer engagement practice can reduce churn rate – the number of customers that stop doing business with a company over a specific period. When customers are actively engaged with the company across various customer engagement platforms, it becomes easy for them to return for more sales.

3. Boost customer loyalty

This is quite simple. A customer who actively engages and participates in your business marketing campaigns gives feedback when necessary and promotes your brand with their friends and family pretty much ticks all points of a loyal customer.

In this situation, the customer’s loyalty and commitment will always bring them back for more transactions.

4. Creates better opportunities for up-sell and cross-sell

By gathering and analyzing the data derived from your customer engagement campaigns, you can better understand what works for each segment of your customer profile. From this, you can personalize customer experiences and develop a better customer engagement marketing strategy to promote up-sell and cross-sell offers.

5. Shorten the purchase cycle

A good customer engagement strategy is not only applicable to existing customers but to all the customers that an organization sells to or plans to sell to. When developed rightly, a customer engagement strategy can help you shorten the sales cycle and convert a prospect to paying customer a lot faster.

6. Build more brand advocates

Your brand advocates are your brand loyalists, they are essentially those customers that are sold on your product and brand and take it upon themselves to promote your brand among their colleagues, family, and connections. A well-equipped engagement strategy can help you drive active participation from your loyal customers and include them in your sales process.

7. Enhanced customer service

Following reports that 93% of customers are more likely to repeat purchases with a business that offers excellent customer service, one can’t underestimate the significance of customer engagement to business growth and success. By engaging customers and ensuring all their needs are fulfilled, you serve them better and help them feel special and highly valued.

8. Establish your brand identity

Although your brand marketing communications and campaigns exist to establish your brand identity and make it more profound to your customers, a customer engagement strategy can help further create a distinguishable brand identity by constantly keeping customers’ needs at the forefront of your brand efforts and communication. Apart from these strategies, buying Instagram auto views can help you a lot if you are looking for instant and massive engagement on your Instagram account.

Types of Customer Engagement

Customer engagement happens in different ways depending on the customer’s needs and desires and the stage they are in the sales cycle. Here are some of the prominent types of customer engagement.

1. Onboarding Engagement

Usually, a company’s first interaction with its customer begins when the customer makes inquiries about its products or services, visits your website or social media channels, or creates a new account with you.

Onboarding engagement is the first point of touch or interaction with the customers and can either be temporary or permanent and are usually short. This is mostly because customers during the onboarding process visit your website or interact with your brand on social media to learn about your products or service and see if it’s helpful to them.

You can improve your onboarding engagement by using web analytics services and tracking certain web key performance indicators (KPIs) such as page views, time spent, and bounce rate to enhance visitor interaction during this process.

2. Active Engagement

Active engagement occurs from regular interactions between a company and its customers. Compared to onboarding engagement which occurs at an early stage of the sales cycle, active engagement occurs when the customers have become frequent buyers who actively use the product.

These customers make up your target audience, who spend more time on your website and social media platforms. To get the best out of these customers, you must invest in promotion for your social media accounts during active engagement with your customers to deepen your relationship with them.

Consider encouraging them to share their feedback, follow on all your social media channels, subscribe to your newsletters, and download your mobile apps.

3. Social Engagement

Social engagement comes in a different form compared to the first two types of engagement. As the name implies, social engagement refers to the type of customer engagement that takes place on social media platforms with customers who already know about your business and most likely want to learn more about it to determine its usefulness for them.

In this type of customer engagement, you must focus on strengthening the relationship with your customers and improving their connection with your brand. Consider organizing online events, and contests and offer incentives that can help you attract an active and engaged social media base.

4. Collaborative Engagement

Collaborative engagement is by far the highest form of customer engagement. This is the point where customers actively participate with you by sharing feedback and promoting your brand with their connections.

This type of engagement is common with loyal customers who are passionate about your products, follow you across all your social media platforms, and promote your brand with their connections.

Every business needs a healthy collaboration with active customers to gain new customers and grow the business. Some of the ways you can collaborate with customers are by encouraging them to post your brand or share your social media posts, write positive reviews about you and get them to constantly fill out your surveys.

10 Powerful Tips to Improve Customer Engagement

Consider the following tips to improve your customer engagement and help you develop a working engagement strategy.

1. Maintain the customer lifecycle

A customer lifecycle is the length and form of a customer’s relationship with a brand or a company. The goal of a success-driven company should be to cultivate a healthy lifecycle with its customers and make it as long and prosperous as possible.

To improve a customer lifecycle, consider acquiring new customers, developing customer retention strategies to keep them engaged with you, and strengthening your customer relationships beyond the first purchase.

2. Consider all important data

In most cases, businesses are tempted to review only purchase history to gain insights into the performance of the marketing campaign. However, businesses must look beyond marketing demographics to use data from their customer’s preferred channels of interaction, Household composition, propensity scores, behavioral data, and other important metrics.

Gathering and analyzing this data can help you gain valuable insights into your customers that your competitors are most likely not considering.

3. Understand your audience

Good customer engagement is all about fulfilling the needs of customers and making them feel fulfilled. To improve your customer engagement strategy, consider learning more about your customer’s needs and their pain points as well as other important information that is critical to your sales and business growth.

When you have all this important information in check, you can improve your customer engagement by proactively making plans that solve all their needs and make them keep coming back.

4. Makes use of all available business insights

In present times, businesses use multiple touchpoints to connect with customers and keep them engaged. For this reason, you must generate insights from all customer touchpoints and use them to improve your customer service and give them something that will keep them coming back for more.

5. Identify and solve all customer triggers

To improve your customer engagement, you must be proactive with your customers by going to them first and not waiting for them to come to you. Considering that engaged customers are most likely to spend on you, you must identify the customers that are most important to you and determine the most valuable time to reach out to them within their customer lifecycles and purchase cycles.

6. Build a positive brand tone

A company’s brand voice is an essential part of the business personality. You must build a brand voice with a distinct personality that succinctly reflects both your brand values and the values of your target audience.

Doing this can enable you to create a human-to-human connection with your customers that can help your customers build trust with you and the products you offer. You can maintain active communication with your customers and boost your brand voice in every content you develop and interactions you have with them

7. Connect with customers on social media

If you are passionate about improving your customer engagement strategies, then it’s time you begin working with social media channels like Facebook, Instagram, Twitter, LinkedIn & TikTok to get your brand closer to your customers and engage them on the platforms.

It’s no secret that social media will help you attract new customers and connect with repeat customers. For better performance, you can leverage social media platforms to support your customer engagement marketing strategies by creating and sharing content that your target audience can like, share, and comment on.

Some of the best ways to enhance your social media engagement are by encouraging your customers\target customers to tag their friends on your post, repost your content, and regularly conducting giveaways to get more people to interact with you.

8. Invest in Content Marketing

Content Marketing is a contemporary form of marketing that uses content to reach customers and promote brands. The general idea behind content marketing is the creation and use of blog posts, e-books, videos, webinars, guides, and other forms of marketing or brand promotional content to provide customers with valuable information that is peculiar to your brand.

Although there are various forms of content that you can create, the most effective of them all is videos. Following reports that the human brain processes visuals 60,000 faster than text, videos have grown in popularity to become the most sought-after content to drive customer engagement and increase traffic to your website. Check out some content marketing tips.

9. Be ready to challenge existing assumptions

It is a common business philosophy as well as a proven marketing tactic to challenge existing assumptions about your business, products, or strategies. If something has worked for you in the past, there’s no guarantee that it will continue to work in your favor in the coming years. This is why you must always challenge your existing strategies with new ones.

Look into new data to find changes that you can leverage for your business success. Constantly update your existing data and insights to ensure you have the best available data to work with.

10. Provide different means for your customers to get in touch

With the clear understanding that customers can always have issues when working with your product or simply just have questions when checking out your website or mobile apps. To manage their frustrations when this happens, you must always stay close to your audience and be readily available to answer the questions or give them more clarification.

Consider using platforms like email, live chat, social media, chatbots, etc., to keep customers engaged and happy. Maintaining customer engagement is an ongoing process that requires that you stay connected with your customers.

Three (3) Key Steps to Customer Engagement

Below are the steps to creating a smarter customer engagement strategy that can help you retain loyal customers.

Step 1: Research

This first step involves conducting comprehensive research to gather data on what customer engagement looks like in your business. You should also be on the lookout for operational data like the number of loyalty programs, social shares, likes and comments, and other relevant information about your customer’s opinions about your engagement strategies.

Research what motivates your customers to engage with you by collecting their experience data from them using surveys and other available feedback options.

Step 2: Analyze Data

After gathering and collating all the important data in step one to help you gain a better understanding of the kinds of engagement that is happening in your business and what motivates your customers to do so, the next step is to analyze the data and look into ways they relate to business outcomes such as sales, NPS, CSAT, and customer effort scores.

Step 3: Iterate and Innovate

The final step is to put all the findings into action and close the gap between action, measurement, and results.

Metrics to Measure Customer Engagement Strategies

Here are some of the most effective metrics that you can use to measure the level of engagement levels for your business.

1. Average time spent on site/page

This on-site metric is used to measure the average time spent on your website or webpage by a customer. By capturing your web visitor’s attention and interest in your site or page, you can work on the best ways to engage them and make them come back.

2. Customer loyalty

Customer loyalty can be measured using the Net Promoter Score (NPS) metric – a single-question survey that gives you a number from -100 to +100. The higher the NPS score, the more loyal the customer is.

3. Open and Click-through rates

The open rate is the percentage of unique opens received, while the click-through rate is the percentage of recipients who click on the call-to-action (CTA) in a message. These two metrics help you understand how your audience is responding to your communication via emails, push notifications, social media campaigns, etc. This directly how engaged your customers are.

4. Customer Satisfaction

Customer satisfaction can be measured using the CSAT method, which involves adding variation questions such as “How would you rate your overall satisfaction with the (products/services) you received?” The more satisfied your customer is, the more likely they are to repeat purchase and possibly become loyal customers.

5. Number of forms filled

This metric is good when you have a form on your website or digital channels to capture your visitor’s data. The number of filled forms you receive could be an indication of the visitor’s interest in your brand.

6. Customer Referrals

On most occasions, engaged customers are most likely to become your brand advocates, loyalists, and evangelists who go around sharing the good word with their connections and families. Measuring the number of customer referrals is a good indicator of how engaged your customers are.

7. Repeat Purchase

Measuring the number of repeat purchases you get is a good indicator of how engaged your customers are. When customers come back over and over to buy from you, it shows they like your products.

8. Frequency of Contact

The number of times your customers get in touch with you for queries, give feedback, offer you advice, etc., shows they care about you and would love to see you grow. This can give you a better insight into your customer engagement.

9. Dwell time and Repeat Visit

The amount of time your customers spend on your website or on-site store and the frequency of their visits is a clear indication of how engaged they are with your brand.

10. Social media engagement metrics

How well do you interact with your regular customers on your social media channels? Measuring how well you perform by each social media channel metric with your sales and operational data can help you decide on the best approach to better engage your customers.

8 Proven Customer Engagement Strategies

Customer engagement strategies differ from company to company. To develop one that best fits your brand and is tailored to your needs, you must learn more about your customers and identify the best channels to connect with them. Here are eight proven engagement strategies to improve your customer engagement.

1. Use Personalization

The idea behind personalization is to create customized services tailored to customers’ needs. Personalization is one of the best means to improve your customer engagement by offering a personalized customer experience. Consider doing the following:

1. Include the customer’s name in the communication.
2. Know their location of communication.
3. Personalize your messages to fit their interests.

When sending them emails consider personalizing the emails and tailoring them to their needs. Doing this will help you connect with them better.

2. Encourage the use of User-generated content

User-generated content (UGC) is any form of content – text, audio, video, art, or graphics – that your customers create about your product or brand. It is a clear indication of the community you have built and sharing it on your page is a way of appreciating your customer’s efforts.

The use of user-generated content can also positively influence the purchasing decisions of potential customers. You gain more recognition and appear as a credible brand if people use and post about products on their social media accounts.

To encourage more customers to post about your brand and product, consider using simple CTAs in your content, adding a share button to your website, or encouraging them with incentives. You can build a strong and supportive community by showing appreciation and motivating more customers to create and share their content about you on their channels.

3. Be active on Social media

It is no news that social media has grown in recent years to become a powerful force in contemporary marketing practice. With over 4 billion people now active on social media, it would be in your best interest that you set up your brand presence on some of the popular social media channels like Facebook, Instagram, Twitter, TikTok, LinkedIn, YouTube, etc.

Use these social media channels to connect with your customers, get closer to them, share your product updates with them, and improve your interaction with them. Be available to help your customer when they need help, answer their questions and run promotions.

4. Leverage gamification to boost user experience

The concept of gamification is the use of gaming elements in non-gaming environments. A lot of non-gaming companies are employing these methods to engage customers and keep them with you. Include game-like elements in your system to make customers more actively involved in your business.

You can gamify your processes and engage more customers by doing one of the following:

• Add a customizable profile and dashboard
• Use leaderboards with or without incentives.
• Give badges to motivate customers
• Offer them rewards for completing certain tasks or taking specific actions.

5. Offer customers incentives

It is no news that customers feel more encouraged and motivated by incentives, rewards, discounts, coupons, or freebies. By offering customers something of value, you encourage them to take specific actions that can benefit your brand. Based on your business needs, you can one or more of the incentives to keep your customer engaged with your brand. Check out the guide about sales incentives.

6. Be Responsive

Nothing beats being readily available and responsive to customers’ needs, queries or concerns. When customers hear from you promptly, they feel heard which helps them to trust your brand more. You improve your brand responsiveness by doing the following;

• Add live chat for customer service
• Use feedback forms
• Measure the Net Promoter Score (NPS) and act accordingly
• Interact with customers like a human and not a robot.

7. Make it easy for customers to take action

Make it easy for your customer to take action by providing clear and easy-to-follow instructions, including a simple call to action to content and platforms, and add functional quick-action buttons to create a better user experience for customers and enhance your business’s average customer lifetime value.

8. Create an omnichannel, definitive roadmap

The final step to creating a working customer engagement strategy is developing a definitive, omnichannel strategy with a step-by-step guide on how you can leverage your digital channels to attract your audience’s attention, enhance customer interaction and build long-lasting customer relationships.

Customer Engagement Tools

Here are some of the best tools that you can use to support your customer engagement efforts. While some of the tools support online and offline engagement, others only support one of these.

1. Live chats

Live chats are web-integrated chats on websites, mobile apps, and other digital channels that enable visitors to chat directly with a customer service representative, giving room for customer engagement to be nurtured. Live chats are effective because its convenient, fast, and can help to solve customers’ concerns without stress.

2. Social media networks

Social media is an essential and effective customer engagement channel that can bring you closer to your customers, promote your products or services and help you generate new leads. Maintaining an active and responsive social media presence can help you engage your customers.

3. Messaging platforms

Messaging apps like Facebook Messenger and SMS messenger are excellent channels to help your customers reach you when necessary.

4. Chatbots

Chatbots are AI-powered messaging system that is used to provide customers with fast, stress-free guidance or assistance when a human customer service representative isn’t available to help the customers. Using chatbots can help you showcase your brand professionalism and show your customers that you value their time and concerns.

5. Website Analytics

By constantly monitoring your web analytics, you can measure your engagement performance on your website, and give you insights on how you can improve your customer engagement tactics. In addition to this, web analytics can also help you understand what’s working and what’s not working.

6. Email

Email is an effective digital marketing and customer service tool that can help you connect with your customers on a professional and personalized level. It opens doors to more business opportunities.

7. Phone System Mobile apps

Phone system mobile apps are powerful channels to streamline your customer communication and help you connect callers directly to employees.

Customer Engagement: The Bottom Line

Customer engagement is an important element of your business marketing plans that is capable of building your loyal customer base and helping you retain more customers for increased sales. Using the above tips, strategies and steps can help you customize your business customer engagement marketing strategies to make customers feel appreciated and highly engaged in your brand.