Challenges in Customer Engagement
Original article link- Times of India
Never a day goes by without a business leader extolling the virtues of building better engagement with their customers. On the other end, social media is rife with examples of brands bailing out on their customers. Many times at critical junctures.
So, what ails customer engagement?
There are 4 areas that have changed customer engagement in the post-Covid world.
- Emotional and Behavioural myopia:
Over the years, organizations have built a decent level of competence in gathering insights into customer needs and wants and of the marketplace. Yet a similar understanding of the customer’s emotions, contexts and behavior biases has unfortunately not happened.
In times of uncertainty and stress, consumers and customers seek assuredness. They seek repeatability and consistency. Surprises worry them. This is the emotional “deliverable” that they seek from brands. Brands seem to completely miss out on this.
Take the example of the famed, ten-minute guaranteed delivery for groceries. This was a solution looking for a problem. No lives were disrupted when deliveries were 30 minutes. So then? Somebody decided that a 10- minute delivery is a guaranteed competitive differentiator. What real-world problem was being solved here? None!
Having committed this new 10-minute paradigm to customers, can a ten-minute delivery be guaranteed? Each time, every time? And if it cannot be, is adding this new source of stress to a customer’s life, helping or hindering creating deeper engagement?
Why “train” customers to expect a new level of commitment (which they did not ask for, by the way) and then inject dissonance into a relationship?
- Front Loading the Experience:
The rush to acquire customers at the expense of everything else has led to most organizations creating a comparatively superlative experience in the” choice to pay” phase of the journey. “Post payment to delivery to consumption” is where things unravel.
The consumer experience is front-loaded. With a great-looking storefront and mind-boggling discounts, tempting the customer to buy right away. Where the processes and people are trained to bend backward to ensure the customer is acquired right away.
Nobody bothers to question if this newly minted customer is retained for the longer term and if will she keep coming back. Or whether she will spread positive word-of-mouth.
To understand this, all one has to do is to open an e-commerce site/app and experience the dazzle of the purchase experience. This short-sighted approach has a twin impact. The superb initial buying experience primes the customer to expect a similarly awesome experience throughout the customer’s journey.
This is misleading. Thus higher the delta between the initial purchase journey and the rest of the journey, the higher the dissonance and disengagement.
Secondly, customers tend to forget the razzle-dazzle of the purchase experience, when the rest of the journey does not meet their desires. The magic quickly fades away. Customers tend to only recall and retain how that journey ended. Poorer the end of a customer journey, the higher the disengagement.
- QSQT: Quarter se Quarter tak aka The Quarter is my only horizon
Most organizations that only live by this credo, do not see the impact this has on engagement. They have a laser lock on short-term revenue opportunities as opposed to any long-term measures to keep and grow customers. This also is a prime reason, for the obsessive focus on creating a desirable purchase journey as discussed earlier in this article. Showcasing top-line growth makes for a beautiful quarter-end review story.
What it does not do, is create long-term committed and engaged customers, which is the backbone of any sustainable organization.
While tracking and delivering immediate revenue goals are a must for growth and cash flow, organizations cannot and must not build a culture that rewards top-line growth at the cost of long-term engagement of valuable customers.
Brands seem to forget the age-old wisdom, the cost to acquire a new customer is far higher than the cost to retain an old one.
- Re-Definition of Value and the People Organization:
Post-Covid, customers are seeking a re-definition of what makes up “value”. A product that works or simply looks good, or a service that just about delivers, is passe.
Badge value as a primary driver of sales is becoming a tough ask.
Customers are seeking solutions that cut cognitive effort of any kind. “Give me no stress, go easy on me”, is what they seem to desire. They seek solutions that are contextual to their immediate needs. Which get them an edge, through savings of scarce resources; attention, time, energy or money, or all four.
Please do note the four scarce resources. Yes, “attention” is a scarce resource! This then is the new definition of “value”.
Brands that recognize this are re-tooling their culture, their processes, their technology, and their communication.
This renewed definition of value means that short-term thinking driven by freebies and discounts is fast approaching a point of diminishing returns. Brands have to necessarily go back to the first principles and ask themselves, what real pain am I solving? What emotion am I catering to? What stress, fear, and uncertainty are I eliminating? What happiness am I delivering? Is, my execution, living up to the promise, every day, each day 24×7? Do I have a systemic method to learn from my failures and grow?
This brings us to the elephant in the room – The Great Indian People Challenge!
The challenge is a severe talent crunch within enterprises to deliver on this new definition of value. We, simply, do not have enough customer-centric, well-trained cohorts of people who can deliver on delivering superlative engagement to customers.
By the time an employee is trained to understand the context of the customer, the brand promise, and what it means to engage, the employee is gone. With such unprecedented levels of attrition, training becomes a never-ending treadmill.
And then there is the customer context.
There are examples of salesmen tasked with selling luxury pens priced at Rs. 2,00,000 a pop in tony up-market stores, who live 9 to a room in a distant suburb, travel 25 km, each way, stacked like sardines in a local train. What context of luxury would one expect from this hard-working but clueless employee?
But deliver they must. Slippage in any one of these 4 areas means organizations are on a slippery slope of losing customers, employees, and revenue.
India, fortunately, has, at the time of writing been shielded from the kind of inflation that looms over other economies. However, brands would be mistaken to surmise that Indian consumers and customers are not looking to stretch their budgets while seeking enhanced levels of experience. This puts Indian brands in a rather unique position of being value leaders while aceing customer engagement.
Just as well. This could be a robust preparation for Indian brands to step onto the global stage. The story on customer engagement in India has just begun to be written.