Changing the View on Customer Engagement and Employee Retention

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Customer Engagement is a popular concept these days. CEOs, marketing gurus, advertising experts, and web analytics professionals use the term with equal abandon. It can be confusing to see the same word used in such diverse settings. This article outlines the different meanings of this term according to market space, and explores how experts in each field have suggested that customer engagement should be quantified.

Basically, there are three major disciplines that commonly use this phrase: advertising, website optimization, and marketing. In all three areas, Customer Engagement (CE) describes the experience of the consumer/user. Because no widely accepted measuring stick exists for this ubiquitous term, companies who aim to help other companies craft a customer engagement strategy must define key metrics for this quality, so as to measure their own success. As such, no two companies measure CE in exactly the same way, but there a few common areas of overlap across organizations. Below, you’ll find definitions for CE in each market space, along with common attributes used to measure it.

Customer Engagement in Advertising

The Advertising Research Foundation (ARF) has defined engagement as “turning on a prospect to a brand idea enhanced by the surrounding context.” In general, advertisers use the term “engagement” to describe how a potential viewer interacts with an advertisement. Old-school advertisers saw the purchasing process engagesmart  as fairly one-sided: ad designers caught consumers’ attention, stimulated their interest and desire, and drove them to purchase. Many modern advertisers focus instead on how people interact with an advertisement by combining the ad’s messages with their own metaphors, associations, and symbols. In advertising, an engaged customer is one who has personally interacted with an advertisement, and who has ideally made the choice to purchase a product or service. Compared with Voice of the Customer program expectations in marketing, advertisers are generally looking just at how advertising impacts a brand’s customer engagement strategy.

Customer Engagement in Website Analytics

The definition for customer engagement in the realm of website analytics is slightly different. In this market space, CE describes how a user interacts with a brand’s website. In website analytics, the goal of a customer engagement strategy is to increase conversions. A conversion is a goal online marketers have for website visitors; common conversions include online sales, sign-ups for e-mail newsletters, and sign-ups for free service trials.

Web analytics companies define engagement according to a variety of metrics, such as the amount of time each user spends on a website, the number of web pages each user views, and the number of posts customers make at social media outlets like Facebook, and Twitter.

Customer Engagement in Marketing

In marketing, Customer Engagement describes how engaged the customer is with a certain brand. Marketers contrast CE with older terms such as customer satisfaction or customer loyalty by saying that engagement focuses more on the customer’s long-term emotional attachment to a company. Increased word-of-mouth referrals and customer advocacy are said to be the result of high CE. It isn’t unusual for a business leader to be interested in beefing up his or her customer engagement strategy, since market research has linked this elusive quality to key business results including profit levels, stock price, ROI, and share of wallet.

Marketers may measure engagement by researching such metrics as customer retention, sales, revenue per customer, marketing and sales cost, and frequency of repeat purchases. Website analytics such as time spent on site or email opt-in are sometimes used by marketers as well.

 

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