"Customer engagement" is a strange term and many people have different opinions of what it means. So what is customer engagement? According to John Hinley of Aimia, the key to earning customer engagement is having a lot of knowledge about your customers.
Does communication with customers through twitter, email and Facebook count as customer engagement?
"Not necessarily", Hinley says. A more traditional way to define customer engagement is through Points & Prizes as customers like to feel like a part of community and have access to exclusive information. However, simply giving your customers points or cash won't work, you must build a relationship with them too.
Classic loyalty marketing is identifying customers, understanding what they are doing and influencing them. As technology developed, expectations from the consumer have changed and the aforementioned model does not follow this change. Now operators need to extend the loyalty circle- they need to understand exactly what their customers are doing and develop value and something real for them.
"Operators have to extend their loyalty circle and increase interactions with customers", Hinley explains. "Before customers even set foot in the store we must understand what they are doing and what behavior is influencing them. Once people leave the store, we must manage that interaction even further".
"Nike did a great service, allowing customers to track where they run and how they use their purchase", Hinley states. This is a great example of interaction post-purchase when companies can track how happy customers are with the service or product they receive, manage it and take action around it.
Hinley explains, "The key to customer loyalty is â€˜connecting the dots'.
Google knows what you want, but not what you've done, Foursquare knows where you are, but not what you like, and Facebook knows what you like, but not what you buy, retailers know what you buy but not what you want", explains Hinley.
In the UK, Tesco just announced will be rewarding points for "likes" on Facebook, an example of "connecting the dots" between where people are, what they are doing and what they like.
Data and technology are driving these changes in loyalty. There is a variety of data coming from dozens of sources plus the speed of the data has greatly increased, for example via twitter. The challenge here is managing expectations through channels such as twitter because the consumer expects an immediate response which can be hard to deliver it not managed properly.
The main takeaway? We have to learn how to harness data and technology to make them work together. Data and technology will continue to drive the evolution and engagement will be built by extending relationship and loyalty cycles, connecting the dots, delivering value and relevance and finally, brands with real relationships will become the most powerful.
This guest post comes courtesy of Rebecca Liggero who was at last year's World Gaming Executive Summit
Aimia will be in attendance at this year's Loyalty World Europe, which is part of Europe's Customer Festival in September. To make sure you don't miss out on their well-learned insights around customer loyalty, make sure you download a brochure for free today.dracorubio - Flickr]