Brands might be seriously involved in the business of engaging with their customers – but are customers feeling engaged by brands? Direct marketing agency, Targetbase Claydon Heeley (in conjunction with MSS) set out to understand the importance customer engagement plays in client organisations and their overall marketing strategy, how it is being used and the barriers faced.

Their findings reveal that 82 per cent of survey respondents have a customer engagement strategy in place – and around a third of them have had one in place for more than two years. Only six per cent claim to rarely or never hear about engagement . . . 74 per cent say it’s something they hear about all the time!

  Targetbase Claydon Heeley (TBCH) chief executive Steve Grout (pictured) reports that businesses are truly getting behind the notion of customer engagement: 87 per cent are investing in it right now, with 24 per cent ‘investing heavily’ and only ten per cent are not investing ‘for the moment’. Confidence is high – 78 per cent believe what they are doing regarding customer engagement is effective.  

Nonetheless, 77 per cent of 1,200 consumers polled by TBCH separately last summer feel brands are failing to engage with them.

Grout said: "I was surprised by the high level of marketers who said they had an engagement strategy in place. They are spending money on it and it’s real, but they are not doing it effectively: if customers are saying they don’t feel involved, then they are not really engaged."

The survey shows businesses are working to different internal definitions of customer engagement, ranging from: ‘Conversations with customers that are two-way’ to ‘Just how we do things’.

Which sectors do marketers think are engaging well? Overall, Retail, mentioned by six in ten, was felt to be the area to learn from, followed by Travel & Leisure and Charities. In terms of brands, Apple and Tesco received the most spontaneous mentions.

Grout added: "Tesco has been praised for delivering relevant, personalised offers, not just as one-offs, but through a proper programme, reacting to individuals based on what they do and like. And this is what turns them into brand advocates. If people don’t feel strongly about you, they won’t recommend you."

Websites, customer services/contact centres and email were considered the most effective touchpoints, while text messaging was deemed to be least effective. Free goods and rewards were felt to be the least effective methods of driving customer engagement – which is interesting, since retail is considered a leader in engagement and is a category that heavily focuses on reward and promotion. Grout explained: "Freebies and rewards don’t necessarily build customer advocacy or retention. They create a promiscuous consumer who moves from brand to brand depending on which has the best offer. You have to look to create better value to inspire advocacy."

Most effective ways of engaging with consumers cited by marketers were personalised and tailored communications, demonstrating understanding of the customer, putting customer feedback into action and reliable customer service.

But what did the customers say?

• Email and web – as the quickest and easiest to use channels – are frequently used and considered as engagement tools by clients, but many of these programmes aren’t considered as engaging by customers.
• On their own they don’t build true engagement. Multichannel communication helps greater engagement and allows customers to engage on their terms.
• When companies use good contact centres, create great in-store experiences and use direct communications smartly – even ’snail mail’ can work – they can achieve better engagement.
• Consumers are using interactive communications every day, so whatever channel is being used a dialogue should be created between brands and customers by featuring more ways to respond – using the right social media, for example, will make it a more balanced and engaging conversation.
• Rewards are important but tricky to get right. Too frequent, poorly targeted or executed create the risk of annoying customers. Too rich and they cost too much. The secret is understanding the customer insight and the driver behind building and developing rewards. Ensure the offers are brand appropriate, carefully targeted and have measurable, realistic targets – both hard and soft.

Grout added: "Customer engagement marketing is coming of age. The technology is here. The cost of contact and touchpoint management is achievable.  

"But it needs companies to step back for a moment and create a joined-up and consistent strategy that they really get behind. The companies that are doing this well are creating a sustainable advantage – and making more engaged, loyal and valuable customers. The UK brands that scored well among customers are Boots, M&S and Google, while marketers recognise Tesco and Apple – these companies get customer engagement and are making it work for them.

"Without doubt, customer engagement is here to stay. Convergence means it is all around us. Clearly, marketers realise this and are taking advantage of it, but the fact such a high percentage say finance is a barrier, and economic pressures mean short-term tactics, many businesses aren’t really conversing, but just, well, kind of shouting . . ."

Survey results can be viewed here.