Retail Bulletin Customer Engagement Conference 2015
Engaging with consumers has become ever more important for retailers as they compete with their rivals across channels in an age when data can provide tremendous insight into their customer bases.
By Glynn Davis
Speaking at the recent Retail Bulletin Customer Engagement Conference in London Ashley Rhodes, customer data manager at John Lewis, told attendees that at the heart of customer engagement is data but he admitted that John Lewis had not seen data as a strategic asset until relatively recently.
Data as a rich engagement asset
It decided to invest in the area as part of a four-year project because it recognised it could “improve customer service through knowing them better”. The key to this was creating a single customer view – that involved integrating as many as 139 different feeds of data.
Amazingly this exercise revealed one million people who had been lost through poor data matching techniques. “This was a potential £12 million revenue increase just from having better data. If you sort out your data then it is great starting point for everything else,” suggests Rhodes.
But to maximise the value of the data – and enhance engagement – Steve Gray, director of SG Retail, says there must be segmentation. “In retail you can segment in lots of ways and it can be transformational for CRM – with redemptions going from 0.5% to 20% when segmenting on lifestyle (life stages),” he says.
However, what is vital here is sending these segmented groups relevant offers. “Few companies can answer the question about what’s relevant and they’ll look to sell products to a person who’s not bought them before. Tesco defined relevance as something you’d bought before,” says Gray.
Saurabh Bahadour, senior insight manager at Dixons Carphone, suggests segmentation and personalisation is not just about distributing offers but should involve giving customers more usable and valuable content: “As an example, if you are going to give customer free bets then link them into the excitement of an event. Retailers should link content to these offers.”
Social media playing a part
Pete Doyle, founder of the SocialRetail Group, is less than convinced that formulaic segmentation is the answer and suggests social media data needs to be brought more into the mix – rather than just relying on transaction data to determine engagement strategies.
“There is not yet the ability to change the messages for high-value customers or those with big followings [on social media]. It should be about human-to-human conversations, not segmentation programmes. Retail will get back to very personal service,” forecasts Doyle, who adds that the challenge today for retailers is to match the transaction and social media data of their customers.
Consistency across channels
For many retailers another challenge is ensuring a consistent experience is enjoyed by customers across all channels and touch-points – as well as recognising exactly what they are after from their various shopper journeys.
Kelly Tolan, head of customer experience for retail at Virgin Media, created a ‘Voice of our Brand’ framework that helped move the company from the previous situation whereby stores were solely a sales channel.
“We found that 75% of footfall was existing customers and we had no plan for them so we split things into Care and Sales (based on what customers need) but also have a cross-over so there is cross-selling to existing customers,” she says.
As the company has recently taken this new framework to its digital channels Tolan says there has been less distinguishing between Care and Sales: “We’ve moved to one journey because we expect the same behaviours (in terms of customer engagement) regardless of the [shoppers’] journey.
To help employees on the shop floor to deliver this consistent – one journey approach – they have access to an app on iPads that delivers best tips and practices. In addition, managers now have a dashboard to view how individuals are performing against benchmarks based on their dealings with customers (using a simple thumbs-up or down metric).
Feedback is essential
Feedback is absolutely essential as a measurement for determining the levels of customer service and engagement that is being delivered to customers. Wendy Talbot, research manager at Matalan, says the company had previously used mystery shopping but now admits that it was “universally disliked and with disputes over the results it became quite meaningless”.
With a customer experience management programme from InMoment she says Matalan now takes feedback direct from customers’ mouths. From having very little feedback the company now collects 30-50 pieces per month per store.
In Matalan’s stores she says good service is now being better recognised. Whenever an employee receives top marks from a customer this translates into a ‘wow’ alert going to the area manager. There is then a ‘wow of the week’ with the managing director contacting the individual directly.
“Wows have had a fantastic effect on self esteem of the store team, which we didn’t anticipate. We also have ‘rescue’ alerts – for low scores from customers – whereby we’ll contact them [the employee] and talk them through it. We then have an opportunity to rescue the customer and get them back in-store,” explains Talbot.
The loyalty programme conundrum
The ulterior motive of such initiatives is to create an engaged customers who become loyal to the brand. Traditional card-based loyalty programmes have been around for many years but the general opinion at the conference was that customers are today after something different.
For Jim Buckle, chief operating officer at Feelunique, this is a challenge that he is still juggling with as he acknowledged: “We’ve customers who like us but shop very infrequently. How do we make them shop every month? We know our customers spend £300-500 per year so how do we get them to spend all of it with us?”
One possibility is to use a tiered reward system like the travel industry but he worries that if you find good ways to engage with customers then it is hard to then restrict it to just your best customers. Buckle is also considering ‘gamification’ – as a way of helping build a profile of his customers without introducing a formal loyalty programme where they would be asked personal questions when they first sign-up.
Engaging gamification
Like Feelunique, JetBlueAirways recognised many of its customers were infrequent (flyers) customers but it still wanted to engage with them on a regular basis. And from this engender loyalty. It turned to a gamification platform from Comarch from where it now runs an innovative TrueBlue Badge collecting programme.
Lori Favre, analyst of loyalty marketing at JetBlue Airways, says: “We recognised we had customers who only fly once or twice a year but they give us 100% of their custom. We wanted them to earn (credits) every day – not just from when they fly with us.”
There are 400 badges to be collected in the programme, which can be earned as a result of engaging with the airline on social media. “It’s about creating engagement. We’re rewarding them for their social activity. We’re a pioneer using social media to build a brand – that creates a base of supporters who love it,” says Favre.
To maximise the value from the programme JetBlue is able to measure the social ROI of individuals based on their influence, and the rates of conversion (to flight ticket sales) from their social media interactions.
And by taking data on key influencers in the TrueBlue programme from their other social media activity a profile of their preferences can be built up and a more tailored engagement with them then becomes possible.
With 2.5 million badges having been collected to date by JetBlue customers the use of gamification looks likely to be increasingly utilised as part of retailer’s armoury for enhancing engagement with customers.
