Modern marketers and business owners agree that customer engagement is the new consumer experience. eMarketer has predicted that the annual spending on marketing in the US alone will come to almost $175 billion this year. The numbers are likely to reach the $200 billion figure by 2017. While these predictions are encouraging, there is hardly any allocation for customer engagement in them. The irony is that the amount of investment allocated for customer engagement continues to be negligible in spite of entrepreneurs and top level executives in MNCs claiming that it is their top priority.
Investing on customer engagement is a must
Planned budgeting for customer engagement is as important as budgeting for marketing in general. Why? According to a recent survey by State of the American Consumer Report, people who are fully engaged with the brand contribute up to 23% of the total share of the premium generated for the company in terms of revenue, profits, and relationship growth.
Why customer engagement is the new consumer experience
Fully engaged customers are those who stay with the brand for a long time and in some cases, even for life, contributing to the company’s financial growth by a large measure. American research firm Gallup has categorized customers into three types: fully engaged, indifferent, and actively disengaged customers.
Fully engaged customers are sentimental about the brand – they are emotionally attached to the brand and also rationally loyal. Making these customers swerve to other brands won’t be easy. Once they like your product and establish trust in your brand, you won’t have to do much to make them buy your products or services. A brand should focus on this sector of customers while designing loyalty programs. These individuals expect more than just tangible rewards for their loyalty, so you should offer them recognition and value, as well.
The second category of customers is indifferent. These people are neutral, both emotionally and otherwise, when it comes to choosing a brand. When two brands are vying for them, they can swerve in any direction depending on who makes the best pitch. For them, you should have a stronger marketing message, one that will make them lean towards your product rationally. Offer them more than what your competitor is offering, and they are likely to go with your brand.
The third category includes people who are disengaged or not connected with the brand in any way. These people are detached from the brand and can easily switch from one brand to another with or without any influence of advertisements.
The importance of customer service
Regardless of the industry you belong to, it is important to offer quality customer service to give your buyers a feeling of involvement and engagement. Reports suggest that fully engaged customers tend to spend higher than others. This is evident in the hospitality and the banking industries where fully engaged customers spend 46% and 37% more than others, respectively.