Top 10 Customer Engagement Trends for 2015

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Each year, TIBCO looks back on the major trends we saw (and some we helped enable) in order to anticipate both technical and marketing trends likely to influence and impact consumer marketing technologists today.

This year, we were taken by both the rapid pace of change and the concurrent focus on getting back to basics. Not surprising, the best way to move forward is to solidify the core.

Here is a list of what we see as the most important customer engagement trends for 2015.

1. Mobile Efficiency
In 2015, the trend moves from “mobile first” to “mobile efficiency” with smart, connected devices—thinking differently to develop a tight mobile strategy that’s reflective of what phones and tablets do best. Without a doubt, integration of mobile into engagement and loyalty marketing is the single biggest trend of last year, this year, and next. But keep in mind that mobile is perfect for some activities (search, location, notification, wallet, photo), but not for every interaction. In 2015, the trend will be to apply mobile where it is logical, efficient, and creative.

2. Balance of Transactions & Interactions
Brands are increasingly thinking of their customer relationships both in terms of what they buy (transactions) and how they engage (interactions). Deepening loyalty requires balancing purchase metrics with digital and social media interactions. This deeply connected transaction-interaction, customer-brand relationship will determine the expectations and realities of future lifetime value.

3. Rational & Emotional Loyalty
Historically, the value propositions that most contributed to customer loyalty centered around very rational elements of price, product, and convenience. “Loyalty Programs” added additional rationale around point accruals and rewards. While very select brands connected on a deeper emotional level, the majority still competed using the rational building blocks. The realization that emotional (elated) relationships are not limited to a few fashion brands, luxury automobiles, and Apple, is leading to an expansion of how brands engage with their customers. Achieving this higher level of bliss has profound impact on customer value.

4. Engagement Through Experiences
This trend is all about how companies rethink both recognition and reward. Recognizing the enjoyment of a product may trump purchase of the product with respect to building long-term commitment to a brand. Rewarding with a compelling experience (no doubt) has a deeper and longer-term impact than a reward, discount or coupon. The North Face is a brand that totally gets the virtuous circle of experience, being an equal brand driver to the (amazing) products that they design and sell.

5. Permission-Based Analytics
Analytics that give the best insights, best segmentation data, and the best predictive modeling are generated with permission-based data. What is the key to getting and using that data in a non-creepy way? The give-to-get value exchange that loyalty programs provide. In 2015, more data will be sourced to drive more and more powerful insights. The most profound impact will be with consumers who choose to participate in that journey.

6. Most Valuable Customers 
For some brands, 1-2% of customers can account for 20-30% of brand revenue and profitability. Many brands perceived to have the best engagement programs are placing a disproportionate amount of customer value back to the small number of customers who provide a disproportionate value to that company.

A couple examples: when someone reaches an unpublished tier in an airline, or gets a Centurion Card from AMEX, the service and attention they receive is far beyond the investment placed on “nearly” top-tier customers.

7. Simple Scheme with Migration Path 
Previously, companies launched loyalty programs pretty well baked with a fair amount of complexity and a goal of being perceived as sophisticated out of the gate. More and more we are seeing best practices around simplicity, later followed by an interesting migration path. New customers crave simplicity and more people are likely to join. Expanding after starting simple can be done on a far more systematic basis—through testing, discovering, piloting, and learning what people want and what has the greatest impact on the bottom line.

8. Shared Liability
Companies used to feel they should take on the vast amount of the funding rate, cost, and liability burden of the program. Increasingly, there are creative ways to share that with partners perceived to be enhancing, not cannibalistic, of the program and wallet share of the members. For example, credit cards that give a standard 1% back might give 2%—largely funded by merchants for whom the credit card company can provide exposure and marketing. The airline model of partnerships (hotels, cars, cruise) will find itself in retail, sports, and consumer goods.

9. The Win Before the Reward
Overall metrics for measuring success of a program lie in awareness and knowledge, willingness to recommend, and satisfaction. Getting someone to a win and that “aha moment” quickly moves each of those needles and can accomplish a tremendous amount in terms of driving ongoing engagement in the program.

Brands can achieve this by creating excitement and reward before someone actually qualifies for the major program rewards. It can be a fast action or fast win, whether it’s an enrollment hook or something that takes place after a first or second transaction. These can be delivered as part of something that’s published (do this and get that), through a surprise and delight or through something in between like a campaign that is shorter running and not part of the overall scheme, providing more flexibility.

10. Singular Organizational Focus 
Some brands have the benefit of euphoria and people who simply love the brand. Thousands of iPhones are sold every minute of the day, so Apple doesn’t need to focus on a loyalty program. But to a large extent, customers will have a relationship with these opt-in clubs, and they need a singular organizational focus to succeed. There are three key ways to apply this focus:

First is in top-down communications. Loyalty programs need to be championed and communicated from the CEO down to the customer service associates and to everyone in between.

Second is in BI teams leveraging engagement and loyalty data to make better decisions and use them to inform executives and those who interact with customers.

The third is from the consumer standpoint. Perhaps the best example is Starwood Preferred Guest or “SPG.” Many customers think the hotel brand is called SPG and they go to to book a hotel. They think about the company in terms of the loyalty program, not the brand itself.

For more about how to best engage your customers, check out TIBCO Engage.