Customer engagement is a common buzzword, but what does it mean?

It's a term that encompasses all the different ways to attract and retain your customers.

Customer engagement strategies are essential for any business because they help you create loyal customers who will come back again and again. This article will outline seven customer engagement strategies that work well for small businesses like yours. 

These tactics will improve your customer experience, increase sales, and build long-term relationships with your clients—which means you can stop losing sleep worrying about the future of your business.

What is customer engagement?

Customer engagement is the customer's emotional and intellectual connection to your company. It's about more than just transactions. It means that customers become advocates that want to hear from you, learn new things, and engage with your brand on a deeper level.  AdobeStock_402091655

When you think about customer engagement, we focus on the customer experience and its importance for customer retention. However, while customer retention is undoubtedly a key factor when measuring customer engagement success, other factors like user satisfaction (attitudinal), brand perception (perceptual), and loyalty contribute to overall customer engagement.

Customer engagement strategies are essential for any business because they help you create loyal advocates who will come back again and again.

Why should I care about customer engagement?

Customers want to feel valued by the brands they love—and it doesn't hurt if those companies also have a good product or service at an affordable price point.

According to Salesforce's research report on customer loyalty, "The New Rules of Engagement," 41% of consumers polled said their perception of value depends more on how engaged they are than anything else. 

In other words, customer retention is more important than customer acquisition. So instead of spending all your time focused on bringing in new customers, you should dedicate your resources to keeping customers engaged and in love with your brand.

Importance of customer engagement

There are multiple benefits associated with customer engagement, including:

Customer retention

Customer engagement strategies can help you improve positive associations with your brand, which results in higher customer retention rates. According to the Harvard Business Review, customer satisfaction is one of the most critical factors for keeping customers loyal to your brand.

Improving customer experience + increasing sales = high ROI!

Higher customer retention means you'll spend less money acquiring new clients because they will bring their business back to your company when they need more products or services. This leads us nicely into our next point.

Increased revenue by existing customers through upselling and cross-selling tactics

A better user experience also translates to increased conversions, meaning an increase in overall revenue from current users who are likely already familiar with your offerings. Additionally, returning customers usually spend at least twice as much over the lifetime of their customer relationship with your company.

Customer engagement leads to customer loyalty.

Customers that are psychologically loyal to your brand will be more likely to recommend you—especially if they feel like their experience with customer service was excellent. Now I am the first to say that loyalty is incredibly difficult to attain these days.  However, when you can create real psychological loyalty, these referrals can help increase your client-base and boost revenue by bringing in new business.

Customer engagement helps you obtain customer insights.

Customer insight is about understanding customer behavior and the conscious (and non-conscious) factors that drove decisions. It helps create a customer personas, which allows for better targeting of the right customers with the right messages at the right time through personalized mindstate marketing campaigns. This can be highly beneficial in boosting sales conversions while cutting down on unnecessary spending that doesn't contribute to ROI.

Seven strategies to improve customer engagement

Now that you know customer engagement is essential, it's time to improve customer retention by considering a customer engagement plan!

1. Create a psychologically compelling customer experience

The key behind customer retention is ensuring that your customers have compelling experiences when interacting with your brand. If you can provide a customer with psychologically optimized customer service and have them leave your store feeling emotionally satisfied and fulfilled, they'll be sure to tell others and come back again.

Businesses that overlook the importance of customer experience often suffer from it with low customer retention rates. Why should a dissatisfied customer return if their previous customer experience was awful?

Here are a few ways to ensure psychologically compelling customer experiences:
Create user-friendly websites

If your website is cluttered, difficult to navigate, and poorly designed, customers will be turned off by the experience. On the other hand, an easy-to-navigate site with clearly laid out information helps you earn customer trust, leading to customer loyalty down the road!

Provide user engagement with an omnichannel approach

The customer journey is no longer confined to the physical store. Today, customers are shopping across multiple channels—mobile, tablet, and desktop! This means that you need to streamline customer experience across all of these platforms to ensure consistent customer interaction with your brand.

Another great idea would be to offer an omnichannel approach for engaging customers. For example, allow customers to interact with customer service through various channels, such as in-store, chat or app. You can also offer rewards for customer referrals!

User engagement is critical in building trust and rapport between the customer and the company. A user-friendly interface makes it easier on your customer—and boosts customer retention rates over time!

2. Improve social media marketing 

Using social media platforms like Tic Toc, Facebook and Twitter is a solid customer engagement strategy. Social media allows you to directly engage customers, allowing them to share their thoughts on your products and customer service.

To use this strategy effectively, you have to be an active member of social media yourself! Social media platforms are an excellent way for your customers to get in touch with you- so make sure there is someone always available on these networks to address customer concerns.

3. Use push notifications 

In technology, a push notification is a message sent to or from an application on a device to deliver new content. Push notifications are also called "toast notifications." The user experiences a periodic notification sound, vibration, or visual alert to inform about a new message or content becoming available.

Push notifications are a customer engagement strategy that has been proven to work wonders. You can send these personalized messages directly to your customers, and you can even schedule them in advance!

The best part about push notifications is how effective they are at improving customer retention rates- these types of personalization tactics have helped increase customer loyalty by up to 50%.

4. Be proactive with customer outreach.

As a service provider, you need to anticipate the needs of your customers. You do this by keeping up to date on customer feedback and opinion.

Using customer data from surveys gives your customers a chance to voice their opinions and let you know what they think of your products, services, customer engagement strategies, and more!

It's also essential that you use these customer surveys as an opportunity to listen carefully.

By keeping track of customer needs, you can begin building psychological empathy and an emotional relationship with them by anticipating their questions and concerns before they even voice them. This will leave your customers feeling valued and appreciated- ultimately creating more loyal advocates!

For example,  customer service representatives can keep customer complaints in mind when developing new products or services.

5. Create customer loyalty programs that benefit both parties

A customer loyalty program is a great way to incentivize customer interactions. By offering your customers special perks and discounts for being loyal, you'll be able to encourage customer retention at the same time!

Studies show that customer loyalty programs tend to increase customer retention by 15-25%. This is because customers feel valued and appreciated for their support.

For example, an online store might create a customer loyalty program that offers their most frequent buyers free shipping or early access deals on new products.

6. Make your brand feel relatable.

A customer that can emotionally relate to your brand is more likely to stay loyal. By designing marketing messages based upon your customers’ psychological mindstates, you'll be able to build subconscious trust with your customers.

Studies show that consumers are 65% less likely to defect if they develop a high level of trust in their favorite brands!

You can make your brand relatable by creating customer personas based upon psychological mindstates that feel real and then catering your customer service, content marketing, and branding to them.

Another way you can make your brand relatable is by adding a human touch- when it comes to customer engagement strategies in the digital world, an image of a smiling face or friendly customer service representative goes a long way!

7. Focus on keeping high quality customers

It's not always the number of customers you have, but rather their quality. Therefore, your business will grow more effectively by working on customer retention and engagement strategies of those customers who you love to work with or are most profitable to you. 

This is why so many focus on customer retention strategies for their top customers - even though they might take more time and effort than customer acquisition, your business can  see better long-term results.

For example, offering free support or assistance to these customers can go a long way in improving customer satisfaction with your company. You'll also have a chance to fix their complaints before they become unhappy customers.

These are just a few of the most effective customer engagement strategies that you can use to drive traffic, increase conversions and build lasting relationships with current and potential customers.

Tools used to measure customer engagement.

There are many customer engagement tools out there to measure customer satisfaction and improve the customer experience.

Net Promoter Score (NPS)

Ask your customers, "How likely is it that you would recommend our company/product/service to a friend or colleague?" They can answer on a scale from 0–to–ten, with ten being "very likely" and zero being "not at all." 

Then you can follow up with customers who gave a score of six or less to find out why they didn't give a higher score.  There is some controversy on the accuracy of these scores, but NPS is still an important metric to at least track.

Customer Satisfaction survey 

Customer satisfaction surveys ask questions like:

How was your customer experience? How could we improve the customer experience for future customers?

How satisfied are you with your customer experience on our website/app? How likely would you be to recommend us to a friend or colleague?

Customer Feedback

Customer feedback tools like Qualaroo and Olark let customers answer questions in real-time. You can use this information to immediately improve the customer experience by changing copies, images, or CTAs. This customer engagement strategy can improve conversion rates and reduce customer churn.

Grow your customer engagement with behavioral psychology

Customer engagement strategies are customer-focused and customer-driven, which is why they're so important. They help you create a sense of loyalty to your brand by building customer satisfaction with products or services that meet their needs.

Referral vector illustration. Flat tiny products promotion persons concept. New customers word of mouth engagement.

The key takeaway from this article should be the importance of a user engagement strategy. Without it, you'll never fully understand how to build relationships with customers or prospects online. So, schedule a consultation with us to increase customer engagement in your business today!

And if you’d like to apply the power of behavioral psychology to create compelling customer experiences that drive your business to new heights, check out the free marketing resources at The Mindstate Group.

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Topics: Marketing, Business Owners, Shopping