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Customer Engagement

Investment in digital customer engagement ‘increases revenue by 90%’

Investment in customer engagement continues to drive revenue growth and help companies meet their financial goals in the face of economic headwinds.

Twilio’s fourth annual State of Customer Engagement Report reveals that amid constrained resources and economic uncertainty, investment in digital customer engagement increased brands’ revenue by 90% on average, up from 70% last year.

The data also show that effective customer engagement strengthens brands’ ability to adapt to shifting market conditions and evolving consumer preferences.

Customer engagement leaders report increased customer retention, conversion and long-term loyalty, while six out of 10 companies report that investment in digital customer engagement improved their ability to meet changing customer needs.

Twilio’s State of Customer Engagement Report is based on a survey of more than 4,700 B2C leaders in key sectors across the world, plus a parallel survey of over 6,000 global consumers. It also incorporates data from Twilio’s own customer engagement platform, including Twilio Segment.

Twilio’s 2023 research explores essential consumer trends around personalization, data privacy and trust. The findings highlight the urgent need for brands to leverage zero- and first-party data, meaning data collected directly from interactions with customers rather than a third party, in order to improve customer experience and increase customer lifetime value.

The stakes of using data effectively are high, with 66% of consumers claiming they will stop using a brand if their experience is not personalized. Meanwhile, brands continue to overestimate how well they are meeting consumer expectations for communication preferences, protecting customer data privacy, and transparency around customer data usage. Additional consumer insights include:

  • Consumers want a faster transition to a cookieless future. Nearly one third of consumers always or often reject cookies on websites, while nearly two thirds (65%) of consumers would prefer brands use only first-party data to personalize their experiences. Meanwhile, eighty-one percent of brands are still reliant on third-party data.
  • Consumer frustration with inconsistent digital experiences is growing. 51% of consumers report being frustrated with their interactions over the past year, rising from 46% the year before.
  • Real-time personalization boosts customer lifetime value. 86% of consumers say that personalized experiences increase their loyalty to brands, and consumers spend on average 21% more on brands that personalize.
  • Consumers trust brands less than brands realize. 95% of consumers want more control over their customer data, placing top priority on “identity data.” Four in 10 consumers say they have stopped doing business with a brand after their expectations for trust and privacy weren’t met.

As part of the research, Twilio divided B2C companies into three categories based on their customer engagement maturity: customer engagement leaders, framers, and beginners. Customer engagement leaders—companies that have the most mature use of personalization, first-party data, and highest level of digital engagement—reported enormous benefits and increased revenue growth compared to those who have less advanced customer engagement strategies. Specifically,

  • 82% of customer engagement leaders met or exceeded their company’s financial goals for 2022, compared to 62% of customer engagement beginners
  • 40% of engagement leaders reported much higher customer retention rates than previous years, compared to 12% of beginners
  • 41% of engagement leaders reported much higher customer conversion rates than previous years, versus 15% of beginners.

“In this macroeconomic climate, every business is looking to do more with less budget,” said Joyce Kim, chief marketing officer at Twilio. “This research reflects what we’re hearing across our customer base, which is that when brands use first-hand data to personalize engagement with customers, it saves companies meaningful marketing spend and increases lifetime value. For brands facing growing headwinds, this means ROI today.”

Twilio’s State of Consumer Engagement Report 2023 is available as a web report with data available from 18 countries worldwide, and as a comprehensive, downloadable white paper. Both can be found at www.twilio.com/state-of-customer-engagement.

Hyper everything: How tech integration is changing customer communication

By Michael Wright, CEO, Striata 

A raft of new technologies, many of which are easily integrated into existing channels, are changing the way organisations communicate with their customers. 

Chatbots, voice integration, and dynamic (hyper-personalised) content, amongst others are at the forefront of this evolution. But organisations cannot simply implement these technologies and expect dramatic improvements in their customer communication efforts. 

Instead, they have to ensure that any new technologies are utilised in line with the broader goals of customer communication; that is, making communication as valuable to the customer as possible.   

AI and meeting customer needs

With any form of customer communication, the aim should always be to move with the customer through their stages of life and offer the customer appropriate services at each stage. 

So, for example, in the insurance world, a customer may start with renter’s insurance as a single person and move to homeowner’s insurance, car insurance and life insurance as their personal circumstances change. 

Here, artificial intelligence (AI) has an important role to play. In the customer communication space especially, AI-based systems are useful for predicting user behaviour and providing content based on that prediction to prompt the user’s next action.

Organisations are already seeing the value AI provides in this regard, integrating it into email, billing, and mobile payments, all of which contain forms of customer communication. 

AI is also driving the use of chatbots, which appear on websites and instant messaging services, as automated virtual assistants.  

Not only are chatbots useful for customer service,  but also for invoicing and payment collections.  

The rise of voice 

But good customer communication isn’t just about baking new technologies into existing channels. It also means embracing the technologies your customers are actually using. 

One example of this is voice recognition.  

By 2020, Gartner predicts that 30% of web browsing will occur without a screen. And 55% of American teenagers will use speech recognition, daily. 

It’s only natural, therefore, that customers will want to interact with organisations via voice. Any organisation that invests in integrating voice technology into its customer communications now stands to give itself that extra edge over its competitors.    

Micro-segmentation and hyper-personalisation 

If an organisation is going to integrate these technologies successfully, it needs to ensure that it couples them with real-time data to deliver more relevant content, product and service information to each user. 

The more information an organisation has on each customer, the more meaningful and valuable its communication will be. 

Broadly referred to as hyper-personalisation and micro-segmentation, this use of data means being able to provide content that is relevant on the day / month / life stage of that customer. It allows the company to provide information that improves the customer experience due to the very personal nature of the content. 

Moreover, hyper-personalisation is proven to build loyalty and trust, that ultimately makes customers more profitable. 

A dual approach

Putting the customer back in the centre of customer communication requires more than technology alone. Like the human-centred design approach (putting the customer at the core of the product design process), communication design should be too.

Asking customers directly what content they want to receive, when and how, is invaluable to the design process. This dual approach enables the organisation to combine preference and engagement data (technology), with input obtained directly from the people best suited to design the process: customers and employees (humans). 

By taking this integrated approach, organisations can ensure that they provide customers with the kind of communication they need and want. 

About the author – Michael Wright launched Striata in 1999.  A Chartered Accountant by profession, he started his career at PwC where he was responsible for Internet Strategy & Services and Business Information Services. The technology bug having firmly bit, he moved to VWV Interactive as Managing Director before founding Striata. He was the founder of the South African chapter of First Tuesday, the “Global Thought Leadership Network”. As Striata’s CEO, Wright is responsible for the company’s vision, mission and the business’ global expansion

Hyper everything: how tech integration is changing customer communication 

By Michael Wright, CEO, Striata 

Industry Spotlight: Engaging with customers in a mobile gaming society…

In the world of mobile gaming, customer engagement is defined in different ways: it is an effect, a reaction, a connection, a response and/or an experience of customers with one another and with a company or a brand. With the ever-increasing popularity of mobile and social technology, today’s consumers live in an ‘always connected’ state. This level of instant interaction and a more demanding consumer means that, as marketers, we have had to reconsider the engagement and connection with our customers.

At tombola, we encourage our customers to engage with our brand via our social media channels and live-help service. We believe that real-time feedback and social media engagement gives us the opportunity to interact with our players, providing them with a much more personalised experience and it helps ensure they get a positive representation of our brand. We also encourage our customers to engage with each other through the chat feature, as we feel it adds genuine value to their experience and adds to the sense of community that is at heart of the tombola brand.

Since the launch of our app in 2013, we have seen growth in players accessing tombola through mobile devices. The general shift in the gaming market towards mobile platforms caused us to take a more extensive outlook at our customers’ journey, to keep us at the forefront of the industry. For tombola users, we aim to create an app experience that is compelling and fun. For this reason, we now design our games as mobile first. We believe this helps to engage and retain our brand’s audience and is compliant with the expectations of a mobile-savvy consumer who is constantly confronted by well-crafted interactive experiences.

We believe that mobile marketing is a necessary platform for consumer engagement and loyalty. As marketers face more competition than ever before, our users are becoming increasingly demanding of high-quality experiences, which we can successfully deliver on mobile platforms. The first game we developed intentionally for mobile use, Pulse, still remains one of our players’ favourites today. We attribute this to the fact that our games are fun, which is essential to audience engagement. This element of gaming helps to intertwine the marketing and entertainment niches, creating a more transparent experience for customers, which in turn helps us generate brand loyalty. We expect mobile platforms to continue to grow and develop and to be used more and more for gaming purposes, and it’s our challenge to grow with the platform.

 

Find out more about tombola here