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It's time for marketers to look at return on engagement
25th Jan 2010
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Mark Stuart examines the need for marketers to start factoring ROE - return on engagement - into their equations.
Marketing is often pushed to prove its return on investment; and rightly so, because it's vital to prove the value of marketing to the business. Yet return on engagement is a valuable metric in itself, and one that's often overlooked.
Take digital marketing. One of the risks of the internet is that because it's so measurable, companies become reluctant to invest in anything that doesn't bring a direct financial return. But the problem with this is that there are many other things a digital presence can bring you - such as building a brand - that aren't measurable in a strictly linear way. Customer engagement means you can build brand loyalty, turn satisfied customers into advocates, and prevent unhappy customer situations escalating into complaints or negative experiences becoming condemning posts on blogs and social networking sites. We all know the brand damage that can be inflicted by one person's poor experiences or impressions; this shows how customer engagement, despite not being specifically measurable, can be exceptionally valuable in other ways.
Virgin offers a masterclass in customer engagement, down to its friendly typeface and casual advertising. 'Forward. Back a bit. Go on. Stop!' on the vans that install Virgin TV, for instance, shows the company's willingness to break down formal barriers in order to talk to customers in language that resonates with them, rather than the stiff language adopted by many companies as they seek to be professional. EasyJet achieves a similar effect; it's 'c'mon, let's fly!' a world away from how air travel used to be marketed.
Compare the Market's 'Compare the Meerkat' campaign also does this. All campaigns of this type need to get the name to stick in the customer's mind, and the most effective way to do this is to repeat it several times during the advert. However, this runs the risk of being (to say the least) irritating. By subverting this problem, the constant repetitions of the name become a joke and thus strike a chord with the customer, rather than annoying them. Cannily, 'meerkat' was also a much cheaper buy than 'market' on search engine targeted ads, so the company could use its budget prudently and yet still maximise its reach to customers. January 2009 saw double the hits online from a year before, direct traffic rose to 50% from 30% and Aleksandr Meerkat's Facebook page has 150,000 subscribers (including some offers of marriage). His Twitter feed is the most popular (for a non-human) on the site.
Open minds (and ears)
Creating a dialogue between company and customer is key to successful customer engagement, and one way to do this is to ensure that your marketers are listening to what your customers are saying. That seems an obvious point, but it's surprising how little marketing is carried out in this way. Your marketers need to identify with and inhabit the lifestyles that customers live, in order to understand what they are going to need and want, and whether your marketing tactics are going to be welcomed, or perceived as intrusive.
No company will say it prevents its marketers listening to customers; but how many companies forbid their employees from visiting sites like Twitter and Facebook, where their customers are discussing their products, creating their own dialogues, and agreeing or disagreeing with the merits of particular companies' offerings? By all means make sure people don't spend all day online, but don't ban them altogether. Ocado has a 'Fuel for kids' section on its site; a piece of marketing that customers like because it responds to a consumer need. Ocado nearly had a PR problem on its hands when one of the recommendations turned out to be for a bottle of vodka.
What had happened was a simple mistake; a product with a similar code was supposed to be entered, but the vodka appeared instead. However, because Ocado's marketers were online at the time and noticed an incredulous response on a social networking site, the offending offer was down within 10 minutes. The lesson is that because Ocado was listening, and responded appropriately, no PR disaster followed.
Don't target me - speak to me
Customer engagement is also a valuable metric for charities and the non-profit sector. A charity appeal is likely to be far more successful when it tells a story and identifies with the potential donor, than when it uses guilt as a tactic or offers too many statistics, that don't resonate with the individual and can lead to 'emotion fatigue'. Tell the story; make it real; and bring it to life with examples.
Customer engagement is arguably the best kind of marketing, because it responds to the golden rule of finding out what people want, then providing it to them in ways that strike the right balance between a price that customers are willing to pay, and an acceptable surplus for the company. You can't do any of that without listening to your customers, seeing what they have to say and engaging with them in terms that resonate with them and that they respond to. Don't 'target customers'; talk to people. The most successful marketers understand this instinctively; it's a secret worth sharing.
Mark Stuart is head of research at The Chartered Institute of Marketing.
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