In an increasingly online world, customer engagement is one of the most critical aspects of building and maintaining a healthy brand. Between social media, websites, webchat and more, there are a multitude of ways for customers to interact with brands. That’s why companies need a strong customer engagement strategy to be able to meet customers where they are at, and meaningfully connect with customers. Positive customer engagement can build long-lasting connections between customers and your brand. But if you’re not doing it right, customers will disengage, negatively affecting your overall revenue.
Globally, the average customer churn rate is around 35% per year. A company’s customer churn rate can be a reliable measure of its ability to create and maintain long-term, valuable customer relationships and maintain positive customer engagement. And when these customers disengage, your brand is no longer top-of-mind for them, and they are more likely to explore other options. Worse yet, they may be actively moving away from your brand due to a bad experience.
Customer engagement, at its core, it is about creating an emotional connection between a customer and a brand. This emotional connection leads to increased loyalty and, ultimately, increased revenue. While there are several ways to increase customer engagement, many companies choose to focus on improving the customer experience. This means improving the quality of a customer’s interactions with a company at every touchpoint, from the first time they visit the website to the post-purchase follow-up.
Approximately 73% of consumers state that customer experience helps to drive their purchasing decisions. Therefore, companies must focus on creating a positive customer experience that encourages customers to continue engaging with their brand, eventually becoming brand loyalists.
How Positive Customer Engagement Affects Purchase and Loyalty
Customer engagement is a vital component when you consider the purchasing strategies and brand loyalty that your business is aiming for. Companies that can develop and maintain a positive customer engagement strategy will be in a better position to achieve their business objectives.
Here are some of the ways customer engagement can help to drive sales and increase brand loyalty:
Building a Sense of Trust
A key component of customer engagement is developing trust between the customer and the company. When customers feel they can trust a company, they are more likely to remain loyal to that brand.
A study by PwC showed that approximately 73% of business leaders believe that having a trust-based connection with customers is a key driver of loyalty. At the same time, 55% stated that trust helps grow their customer base, and 57% said trust is vital for revenue growth.
Listening to your customers is one of the most effective ways to build trust. Reviews and testimonials from past customers can help you to understand what your customers want and how you can better serve them. With 93% of consumers admitting to reading online reviews before making a purchase decision, and online reviews influencing approximately 67.7% of purchasing decisions, it is vital to engage with your customers and reply to their reviews and comments. Engaging with them will reassure consumers that their concerns are being heard and that your company is committed to providing a positive customer experience.
Creating an Emotional Connection
If customers feel emotionally connected to a brand, they are much more likely to continue doing business with that company, and more likely to recommend it to others.
Research shows that 70% of emotionally engaged consumers spend two times (or more) on a brand they are loyal to. These increased sales result from the connection they feel with that brand and the positive emotions they experience because of that connection.
Improving Customer Interactions with Personalized Communication
A study by Twilio Segment reported that 62% of customers would stop doing business with brands that deliver an impersonal experience. Customers expect a personalized experience from brands. Without it, they are likely to feel as though they are just a number. An impersonal experience implies that their questions, comments, or concerns are just an afterthought.
Taking the time to reply directly to each customer (such as using the reply function on Facebook to reply directly to an individual) will reassure them, helping them to feel confident that their concerns are being heard and that you care about them as a customer.
Bringing in Repeat Customers and Referrals
Customer engagement doesn’t just stop at the purchase. It’s crucial to continue engaging with customers even after they’ve made a purchase. Regularly engaging with customers helps to strengthen the emotional connection that you’ve already established.
Nurturing your existing relationships will help your customers feel they are getting more than the product or service they initially paid for, encouraging them to return for more. Research shows that repeat customers tend to spend about 7 times more than a single-time or new customer.
Beyond increasing revenue, nurturing customer relationships is a big deal because customers are far more likely to share their positive experiences with their friends and family than they are to share their negative experiences.
Once your brand has established a positive reputation, customers are far more likely to refer your brand to others.
Improving Your Customer Engagement
In order to boost engagement, brands must actively work to connect and interact with customers at every possible opportunity. Regular customer engagement is an important way to build both trust and an emotional connection with your brand.
No matter which customer engagement strategies you employ, be consistent. Craft messages that are on-brand and suitable for the target audience, and create positive end-to-end customer experiences, from their very first interaction throughout the entire brand journey. Collect insights about how customers are engaging with your brand and check in directly with customers to gauge how they are feeling about their experience with your brand. Doing so can help you understand what your customers want and how you can better serve them.
When you give customers a consistent (and exceptional) experience, you’ll be rewarded with their trust, loyalty and their engagement.