Customer Engagement: Five important trends
Every retailer, every wholesale dealer and more often, every manufacturer has to provide engaged customers. How better than to do so than by offering the ultimate omnichannel experience?
This goes beyond placing orders and having them delivered. We notice five important trends regarding customer engagement.
The ultimate experience is not just about the user interface design through different channels. It’s about the entire process: product information, after sales, customer support during research and purchase, email confirmation, track and trace system, supply information, payment methods, etc. All in all, the ultimate customer experience is all about comfort, reliability and quality of information. In this regard we see five trends that play a role in customer engagement: digital marketing & big data, new business models, direct-to-consumer, gamification and IT & the business.
Digital marketing en big data
No retailer escapes personalisation. An example: I often receive a newsletter from a certain clothing brand. A strong visual newsletter with applicable content for the company’s campaigns that is irrelevant to me. If I would have bought three pairs of pants and sweater on a Saturday, it would be unnecessary to email me a 15% discount on my next online pants purchase the following Sunday. Needless to say I will unsubscribe when this happens frequently.
The aforementioned can be prevented by putting the customer first, before your own organisation.
When you know your customer, you can influence him, or at least meet his behaviour, and be one step ahead. Due to a smarter approach, the conversion rate increases. Analysing big data, gathered through marketing automation, will help gain smart insight which will lead to personalised marketing. After a client just filed a complaint, don’t just email purchasing pushes but rather send a discount voucher or a personal message.
New business models
Gathered insight combined with innovative technologies can lead to new business models. The new approach is all about the customer: how to offer relevant additional services based on available information about the customer’s needs and behaviour. Let’s say a washing machine would analyse its user’s washing habits in order to send matching detergent samples. Or a smart toothbrush that would record your brushing time and analyse your brushing behaviour through an app, in order for new replacement heads to arrive just in time when the others need replacement. The app could even alert the user’s health insurance in order to receive a discount on his dental plan when brushing properly.
Companies should seek out smart cross- and upselling opportunities more often. We are not talking about a flashlight including batteries but about genuine additional services. A possibility would be selling customer insights to other companies so they can offer added value to the customer in question, anonymously or with the customer’s consent. I.e. Mediamarkt would be selling a television including installation and a streaming service like Netflix pre-programmed with the customer’s preferences. This model comes down to a carefree customer and additional revenue for the company.
The ultimate customer experience should extend itself to an actual store visit as well. Together with a wholesale dealer we are working on a pilot project: How to use IoT-like technology to bring off- and online experiences together, creating the ultimate experience and therefore leading to profit. Let’s take a chef who is looking for some new frying pans. He will probably use his Ipad first at home to check out some department stores and cookware vendors, browsing their website. Browsing is one thing but where are the pans actually located when he gets to the store and which one did he want again? The department store could make our chef a personal offer on arrival since it’s already familiar with his clicking behaviour. It could show route instructions on how to get to his frying pans and notify him when passing one of his online viewed or previously liked items. Bringing recommendations and reviews, cross-selling and upselling opportunities to the customer’s attention is another possibility. The e-commerce platform will be linked to a customer activity tool to make this happen. This will provide insight into the customer’s behaviour, through whichever channel. We are currently investigating the required hardware to track the customer in store and offer him the ultimate experience. Needless to say this occurs within the possibilities and limits covered by the privacy legislation.
Manufacturers skip the wholesale and retail link of the supply chain by increasingly targeting the end customer. This creates in-market competition. Resellers feel they are being left out. Manufacturers claim they help create brand awareness which increases demand and therefore benefits the resellers.
The direct-to-consumer trend also influences customer experience. IKEA regularly asks its followers on Facebook about their preferences posting pictures of cushions for example, asking them which model they like best. Accordingly, that model will be brought into production. The customer feels involved with the brand as they are being taken seriously. In the meanwhile IKEA conducted a fast and reliable market research.
Another tendency includes customers ordering personalised products directly from the manufacturer. Nike makes it possible for clients to customise their shoes in physical stores and online. Converse takes it even further. The flagship store in Soho, New York, has the possibility for customers to design their own pair of shoes in three steps, ready in store after two hours. Price tag: $200.
It requires a lot from systems such as e-commerce platform, Product Information Management, back office systems, etc. But as soon as these systems are able to ‘communicate’ with each other, a wealth of information will be provided: knowledge about the customer that will ensure he only perceives products to his liking. Irrelevant information is reduced and the customer will value the convenience and personal approach.
In all honesty, gamification wouldn’t be the first approach in order to create the ultimate customer experience but it can contribute to a positive experience and an increased engagement. Gaming is popular since it is about the art of seduction and when you do it right, you will get rewarded.
Isn’t that what a customer wants too? Sports brand Under Armour has applied gamification to great effect. At unexpected moments a timer appears in their app, counting down from, for example, sixty minutes. Users, who arrive at the store within eight minutes, will receive a 52% discount on their purchases. This race-against-the-clock-campaign scored big time, especially with Under Armour’s youthful target group.
Gamification can also be used to encourage loyalty. Reward customers for their contribution when they multiply like, positively review or promote a product. Preferably do so by implementing a game element which will contribute to greater involvement as well.
IT and the business
Finally, the ultimate experience is only possible with a properly functioning underlying IT landscape. It is still not uncommon for the business side of an organisation to have a relevant need for a tool or solution and without involving the IT department, it chooses one itself. However, when the chosen solution is difficult to manage and integrate with the existing management organisation and IT landscape, it would be a missed opportunity.
As such you run the risk of creating an inextricable tangle of systems and tools, consequently decreasing your business’ agility. It would be better for the IT department to pro-actively submit ideas and suggest solutions to the business and for the business to have a clear idea about the conditions of independent planning.
By translating strategy into IT requirements the architectural implications can be determined.
As such, every organisation is able to lay a strong technological foundation in order to rapidly respond to new ideas, opportunities and developments regarding the ultimate customer experience.
Let’s get cracking on Customer Engagement
It’s all about the customer; therefore organisations need to adapt their strategies accordingly. Thinking ahead, particularly outside of the common box, is essential. The key to success does not lie in pursuing an omnichannel strategy without the right knowledge and customer input. Investing in IT and systems is of little use without a clear vision on how to provide the ultimate customer experience.
Creating customer involvement is more than simply implementing a few tools. A strategy built on the customer’s knowledge, is the foundation. Analysis of customer data provides insight that can lead to new business models, but it also tells you whether it is worthwhile approaching the customer directly or merely creating involvement by means of loyalty and gamification, for example.
All of this is made possible through an IT architecture created by the business and IT department.
In short, a change is required and now is the time to get cracking on customer engagement.