With these stats in mind, it’s easy to see that there is a direct correlation between how engaged your customers are and how profitable your business is. Up to 2/3 of a brand's profits might rely on effective customer engagement.Īnother customer engagement study by Ray Wang of Constellation Research found that “…companies who have improved engagement increase cross-sell by 22%, drive up-sell revenue from 13% to 51%, and also increase order sizes from 5% to 85%.”
In fact, a study by Hall and Partners’ “Engager” shows that up to 2/3 of a brand’s profits may rely on effective customer engagement. Finding ways to engage with your customers in between purchases strengthens their emotional connection to your brand, helping you retain the customers you already have while sustainably growing your business. However, these acquisition strategies alone won’t be enough to grow your business sustainably. As the ecommerce world has become more crowded, there’s been an overwhelming focus on clicks, conversions and acquisition costs. With platforms like Shopify, Bigcommerce and Wix, it’s easy for just about anyone to start a small business. Why you should care about customer engagement When customers feel like they have just as much to gain from engaging with your brand as you do, you’ll foster a sense of reciprocity that keeps them emotionally connected to your brand. Finding ways to add value to your customer experience can help you drive more valuable engagements more often. We feel this definition accurately addresses both the quality and quantity of engagements that your customers have with your brand are equally important. Here at Smile, we define customer engagement as: "Customer engagement is the degree and depth of brand-focused interactions a customer chooses to perform." Ultimately, Peterson’s definition clarifies that the more valuable and frequent the engagement is, the more invested your customer will be with your brand in the long term. For example, a new shopper might engage by following your brand on social media and placing an order, but this level of engagement is very different than someone who’s placed 10 orders in the last year and also referred their friends. Some customers will have a deeper level of engagement than others. While the first definition focused on the idea of choice, I like that this one alludes to the fact that there are different levels of customer engagement. "Customer engagement is an estimate of the degree and depth of visitor interaction against a clearly defined set of goals."Įric Peterson (How Do You Calculate Engagement? Part II) By making it easier for customers to engage in ways they find valuable, you’ll strengthen their emotional investment in your brand. When you let your customers choose how they’d like to engage with you, you’ll be more likely to uncover the type of interactions that they find valuable. I love that this definition includes the customer choosing to interact with your brand. "Customer engagement is the ongoing interactions between company and customer, offered by the company, chosen by the customer."
Here are a few of my favorite customer engagement definitions from industry experts. By looking at a bunch of different definitions, we’ll actually get a better understanding of all of the intricacies wrapped up in the term. I understand that probably doesn’t give you a lot of confidence in my writing this article, but hear me out.
Like most definitions, people describe “customer engagement” differently.
For example, if you sell through an ecommerce marketplace, then the engagement happens with the marketplace provider, not your actual brand. However, at their core every definition I’ve come across shares one thing in common: customer engagement is all about interactions between your customer and your brand.Īs a result, the interactions that you qualify as an engagement will be just as unique as your business. With so many ways to define it, I can definitely understand why customer engagement feels like such an elusive term. To help demystify this buzzword and what it means for your small business, we’re going to take a look at how customer engagement is defined, how to measure it, and ways you can use it to acquire new customers and retain the ones you already have. The good news is, you probably know more about customer engagement than you think. That’s because customer engagement is a tough term to define, and an even tougher one to measure. Unfortunately after reading these articles I’m often left with more questions than I started with. The internet is full of articles promising to help you drive “omnichannel customer engagement” or squeeze more “meaningful customer engagement” out of your brand experience. It feels like every other article I read refers to the concept of “customer engagement,” and I know I’m not the only one.
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