Measuring customer engagement.

Measuring customer engagement.

If it can’t be measured, it can’t be managed.  Senior managers in large and small companies alike are looking for ways to measure (and by definition, improve) marketing performance. With the average job span of a Chief Marketing Officer a brief 22 months, there’s little interest in engagement as a state of mind: for engagement to matter there has to be a behavioral/transactional component. Otherwise, it simply isn’t going to gain traction in the organization.

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The notion of “engagement” differs depending on the nature of the relationship: customers engage differently than prospects; frequent customers engage differently than occasional customers. Engagement is a continuum, exhibiting, at each stage, a kind of hyper relationship: so, engaged prospects are more interested and more involved than other prospects; engaged customers more frequently visit your website, or participate in blogs and communities than average customers. The challenge is to identify and separate engaged customers and prospects, so that communications and offers can be tailored to their needs and expectations.

What kind of measures might a company look at to identify and partition engaged relationships? Here are 5:

  1. Start with the negative: Look for cues from less engaged prospects and customers. If you’re using e-mail, track unsubscribe requests and spam complaints.  Also, track open/click rates so you can put all non-opener/clickers into an unengaged file and focus more on the openers/clickers.
  2. Purchase patterns: Track customer purchase rates so you can begin to quantify levels of activity.  You can create your own engagement measures based on frequency or amount of purchase, or both.
  3. Product involvement: A customer who doesn’t care about the product is likely to be less committed or emotionally attached to the firm providing the product. Monitor incoming communications about your product or service, monitor blogs, facilitate communities. Start segmenting the involvement so you can measure changes in segments. Repeat website visits and the amount of time spent on your web site are additional measures.
  4. Frequency of service interactions: Branding experts like to say that repeated, positive interactions lead to brand affinity. And they’re right to a certain extent, certainly when it comes to service engagements. It’s crucial to monitor service feedback, problem resolution, overall service satisfaction. Qualitative or quantitative research can help assess after-sale engagement.
  5. Referral behavior/intention: Customers who are likely to refer you are more engaged; a customer who actually does refer your company is even more engaged. Create ways to track – and, more importantly, incentivize – referrals. Word of mouth matters, especially today when social media channels move messages globally, instantaneously.

 

A couple of closing thoughts: first, you can use one, or all, of the measures above to begin tracking engagement, but the key variable is velocity.  This is defined as the rate (or the rate of change) in one measure or another. Second, it’s important to avoid boiling engagement down to a single metric that relates to a web site or a specific offline or online channel. It’s a descriptor of a customer’s attitudes, not a channel’s performance.

This article is written from the personal perspective of Bill Williams. The opinions and views expressed are solely of the author and do not necessarily reflect those of The Miller Group Advertising.

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