Customer Engagement – Best Practices

Companies always talk about customer engagement but many a times there is always a gap between planning & execution. What really differentiates the best from the not so good are the ones that identify the key levers and practice this consistently. Allegiance shares some best practices on customer engagement:

It is important to be able to quantify engagement for a number of reasons. Most importantly is by understanding where you stand with your customers—i.e. how many are engaged, disengaged or on the fence (swing)—you will be able to focus your efforts on developing products, services and programs that will help move people off the fence into your engaged customer group or possibly reverse negative perceptions of disengaged customers and help them become loyal customers.

Four primary economic measurements of engaged customers are:

1. Share of wallet—Engaged people buy more products/services
2. Positive referral—Engaged customers convert potential customers to switch
3. Churn—Engaged people stay longer
4. Feedback Response—Engaged people give more feedback, which in turn gives you the opportunity to address issues and concerns and preserve potentially lost revenue

Loyalty in a tough economic climate

Adage provides some fine point of view on how loyalty can  support business in a recessionary or slow growth economy – by targeting loyal customers and customizing offers:

As a 15-year employee of Hilton Hotels, Adam Burke, senior VP-customer loyalty, has had to contend with the problems caused by economic slowdowns and recessions.

“Like a lot of people in the [hospitality] industry, we’re starting to see some slowing,” Mr. Burke said. “Our Honors members tend to be the group that buoys us through a downturn. They are the core audience and tend to stay loyal and sustain the business especially through those downturns.”

Hilton’s Mr. Burke said that’s why the company focuses on customizing its offers. “We’re in an environment where we have, at any given time, as many as 100 offers in market being personalized on individual customer preferences. It’s become a very cost-effective way to run the business and generated a ton of business for the hotels.”

Dawn Marie, head of retail practice at Rapp Collins, said “”It’s important for us to help our clients understand that loyalty is not a plastic card. It’s about creating experiences and recognition with programs versus just making it a plastic card inside a wallet. That’s what is next for loyalty.”

If marketing is getting real-time, it’s time analytics gets real time too.

In a fast paced world, where customers’ search and buy products thro’ multi-channels, marketers have to take action based on customer behaviour realtime. Analytics tends to be back-end but it has to move and adapt to this new world order in marketing even if means companies start doing simple things well. It’s about getting back to basics first.  Information Week has a review of the book New Age of Innovation on this topic:

Managers are aware that data is one of their most valuable assets. In a survey of more than 700 corporate managers and CIOs for InformationWeek, corporate execs say they’ve put these action points on their list of opportunities for CIOs: “use customer/business data to drive sales growth,” and “use customer/business data to influence new product development.” Unfortunately, many of the analytical tools available, such as business intelligence and enterprise search tools, are complicated, expensive, and temperamental. Add to that the fact that many organizations don’t treat their data assets with the scrupulousness they should, and you see why real-time analytics is a challenge.

Real-time analytics is the key to the intersecting forces shaping the New Age of Innovation. Those forces involve co-creating value with each customer individually and accessing resources from the global supply chain wherever they’re available, represented by authors M.S. Krishnan and C.K. Prahalad with the formulas N = 1 and R = G. In this dynamic environment, “foresight, not hindsight, is of value,” they say (p. 84)

Business Analytics – 10 top moments in history

It’s always interesting to check back in history to track how things evolved and grew. Here’s an interesting piece of news that tracks the history of how business analytics started since 5000 B.C. and has grown over years.  Thanks SAS for this info:

5000 BC: Grog uses two sticks and four rocks to graph the upward trend in sales of his new invention, the wheel.

3200 BC: Sumerian analysts predict the world’s use of letters will be greater than Mesopotamia’s supply of clay tablets by 3,000BC. Analysts suggest something called “papyrus” may solve the problem.

44BC: Roman leader Caesar receives analysts’ prediction that March will be a “down month,” but disregards the data.

1508: Michelangelo uses an advanced abacus to estimate the amount of paint needed to cover the Sistine Chapel.

1590: The Globe Theatre of London text mines peasants’ comments after a play by a fellow named “Shakespeare” and decides to ask him to write more plays like the last one.

1908: Henry Ford conducts a What-If analysis that makes clear that limiting the Model-T to one color, black, is the best way to maximize profits.

1962: The Beatles manager uses early marketing automation software to reveal that Ringo should not sing lead on “I Want to Hold Your Hand.” John and Paul take over on the microphones.

1969: Woodstock ends in financial disaster after organizers rely on spreadsheets to estimate attendance. Hippies dance anyway.

1976: Analysts’ predictions that this will be the bicentennial of the United States are fulfilled. World gains sudden interest in the power of predictive analytics.

1976: SAS is formed and begins to give businesses The Power to Know.