The Three Rules of Customer Engagement

Carrie Walsh sharing insights on Customer Engagement at SMU with the DFW Retail Executives Association.

Carrie Walsh sharing insights on Customer Engagement at SMU with the DFW Retail Executives Association.

The ability to connect with customers and drive meaningful customer engagement can mean the difference between success and failure in today’s retail environment. In fact, in a 2017 study by Forbes insights, they showed that leading companies that do customer engagement well are four times more likely to be experiencing growth of more than 10%. Additionally, they are three times more likely to be in the top quartile of the Net Promoter Score, known as the holy grail of customer satisfaction. Carrie Walsh, the Senior Vice President of Marketing for Michaels shared their success at driving meaningful customer engagement with the Dallas-Fort Worth Retail Executives Association at SMU Collins Executive Education Center last night.

Meaningful customer engagement requires that companies be focused, forward thinking and smart. In essence, Michaels has found success in the arts and crafts category by employing the following three rules of customer engagement:

  1. Engage with a purpose.

    Customer engagement goals for the sake of achieving them won’t get you very far. Your engagement goals must be tied to your business goals and outcomes. Achieving this requires understanding your customers and making it easy for them to communicate with you in the way that they are most comfortable. Engaging with purpose means that a retail organization has to be nimble enough to make any adjustments to its marketing campaigns and messaging as well as customer service and loyalty programs to better meet the needs of their customers. Michaels has a very clear purpose to “unleash the MAKER” that lives inside their customers. Being true to this purpose is the key to customer retention and earning their loyalty. That’s one of the reasons that Michaels has made a big push to win in Omnichannel over the past several years. They know that their customer expects an integrated experience with the brand, both online and offline. And they’ve made data a priority with tracking of their 75M active and identified customers to keep a pulse on their behavior. This has allowed them to strategically shift their media mix while expanding their loyalty program and benefits, resulting in maintaining relevance with their best customers.

  2. Create a culture and organization for customer engagement.

    This is where the rubber meets the road. Customer engagement starts at the top. Everyone in the organization, from the CEO down to the store associates, needs to be on board with your customer engagement strategy. Because it’s not enough to say that you’re tying your engagement goals to the business outcome, the best companies hold their executive team accountable. This accountability is what leads to success. Your executives will ensure that goals are set and met, while providing their teams with the information they need to do their jobs and make key business decisions. Because these companies are laser-focused on the customer, it’s not surprising that the critical metric to which most executives are held accountable is the Net Promoter Score (the measure of the likelihood that a customer will recommend the brand to a friend or colleague). Michaels has made their NPS a priority among their executive team and the entire organization, bringing their score for the likelihood to recommend to the top slot in the arts and crafts category at 45%.

  3. Deliver consistent (personalized) customer experiences.

    Especially with the customer expectation for retailers to deliver an Omnichannel experience, it’s critical that retailers offer consistent service across all channels. While you have to deliver a baseline expectation of technology, you can’t take that too far to the point that you lose the humanity of your brand. For example, it may be appealing to automate customer interactions (through bots and virtual assistants), but you have to ask yourself whether doing so will deliver a consistent and positive experience with your brand. In the case of Michaels, a consistent customer experience also doesn’t mean that you have to treat every customer the same. In fact, they have built the infrastructure and a technology stack that allows them to deliver different messages and offers to different types of customers. This personalization has driven higher engagement with Michaels customers, with double-digit increases in both open rates and click-through rates for their email programs. And they’re working on applying this more personalized approach to both the website and the in-store experience. In the end, customer engagement is more than just tools–it’s about being better at listening to your customers and doing what is best for them.

It’s clear that meaningful customer engagement needs to be a priority for retailers. To find success, they need to understand how to measure it and the value of it to their organization. As it has with Michaels, doing so will ultimately lead to higher growth and better customer retention and acquisition.