It's Time to Face Marketing's Impact on Customer Experience
Marketers who ignore the influence of marketing on customer experience do so at their peril.
Bungling the name of a loyal customer on a direct mail piece. Sending a man a digital coupon for a women's personal care product. Serving a display ad for a product a known customer just purchased online. These are more than cringe-worthy marketing missteps. Rather, they can be serious blows to an organization's bottom line. That's because marketing strategies can have a direct impact on customer experience, which in turn, can lead to dramatic changes in revenue, loyalty, and overall profitability.
Consider this: A slight improvement to the customer experience at a typical $1 billion company can produce an additional $262 million to $272 million in revenues over three years, according to the Temkin Group report “ROI of Customer Experience, 2014.” Conversely, research by CX cloud provider SDL reveals that, in the year following customers having a poor experience, brands can expect to lose 65% of the previous revenue from those customers. What's more, 64% of those customers will stop recommending a brand, leave, or give negative reviews.
No wonder more and more organizations are bending over backwards to create compelling customer experiences—and in response the market for customer experience management tools is predicted to swell from $3.77 billion last year to an anticipated $8.39 billion in 2019, according to RnRMarketResearch.com.
“We're seeing more CMOs and senior marketers recognizing that their responsibility isn't just to get customers in the door, but to help grow the business,” says Bruce Temkin, managing partner of Temkin Group, a customer experience consultancy. “That's when they start recognizing that not only is marketing sending out messages that are important, but also that the experience customers have is important because it affects their long-term value.”
The challenge for marketers in today's omnichannel world is the complexity of ensuring a positive customer experience. It requires understanding how multiple channels, tactics, and touchpoints can shape a customer's thoughts and feelings about a brand. Messaging, email, mobile, brand promise, loyalty programs—they're all among the myriad ways that marketing can either win over a lifetime's worth of wallet-share or alienate customers altogether.
Massage your message
One of the primary ways that marketing impacts customer experience is through messaging. “Providing relevant messaging fosters engagement and retention,” says Andrew Kelly, director of new business development at marketing agency Baesman. “It's an opportunity to build on an emotional connection, whether it's person-to-person or brand-to-consumer.” At the same time, he adds, “irrelevant and impersonal messaging is a turn-off and if you miss too many times, people will shop somewhere else.”
Just ask Matt Willard, marketing director at Super Shoes, a footwear retailer. Willard says the company recently revamped its messaging after learning that it was missing the mark with many of its top customers. In the past Super Shoes' marketing messaging centered on high-fashion imagery and aspirational settings. But after carefully crunching consumer behavior data, Willard says Super Shoes made a fascinating discovery: “We thought that most people wanted to see their better selves in the marketing experience. But we learned that they really just wanted to see something that they could relate to.”
Since tweaking its brand messaging to better reflect the average consumer rather than a male supermodel “hanging off a cliff,” Willard says, Super Shoes has significantly increased the conversion rates of its email and direct mail campaigns, many of which are developed with the help of print and media solutions provider Quad/Graphics.
Judd Marcello also knows just how messaging can make or break a relevant brand experience. Marcello is the VP of marketing at Smartling, a provider of cloud-based translation software. “We don't talk to an e-commerce player the same way we talk to a travel and hospitality brand,” he says. “We talk to them differently because they want to hear different things. What we deliver as a message about the value of our technology is relatively the same, but we have to do it in their context, otherwise it's just irrelevant.” For this reason, Smartling's customized messaging may range from delivering a high-tech whitepaper to sending a quick social media message.
In addition to context, personalization is also an excellent way marketers can deliver a unique message—and product offering—to each of its customers. But while tailored marketing campaigns can increase customer engagement, marketers must walk a fine line between personalizing messages and overstepping boundaries.
“[The creepy factor] is a big theme right now,” says Evan Siegal, an executive director with Morgan Stanley Wealth Management. “How do you strike the right balance?” For example, Siegal says, while it's important to ensure that 20-something, first-time homeowners are marketed to differently than baby boomers on the brink of retirement, it's critical that marketers avoid speaking to the intimate details of an individual's life. “We try to keep all of our education at a level that's high enough that it doesn't come off as too Big Brother,” says Siegal, adding that the company also relies on insight and guidance from data-driven marketing agency Merkle to help build positive customer experiences.
Annemarie Frank agrees that a balanced approach to relevancy is vital. Frank is VP of omnichannel marketing at retailer HSN. One of HSN's most popular direct mail marketing campaigns includes sending customized Welcome Kits via the U.S. Postal Service to customers who've recently moved. “We know that once you move you have lots of different needs, and HSN has lots of products that can match those needs,” Frank says.
Providing transient consumers with offers on mattresses and vacuum cleaners can create a timely and personalized customer experience, but “it's always your responsibility as a marketer to make sure you're providing value and not having that creepiness factor,” Frank warns. HSN accomplishes this by “anticipating customers' needs with the right kind of broader assortment” of products rather than “recommending one particular product based on any data we might have access to,” Frank says.
Choose the right channel
Messaging and personalization aren't the only factors shaping customer experience. Channel selection can also have a huge impact on customer acquisition and retention. Email marketing continues to dominate, as 73% of marketers cited it as a core strategy for their business, according to Salesforce Marketing Cloud's “2015 State of Marketing Report.”
“Email is one of the most personal ways a brand can interact with a customer,” Baesman's Kelly says.
Yet email marketing can easily backfire and damage the customer experience if marketers aren't careful. Kelly advises: “Brands need to respect the time and frequency of customers' communication preferences, whether that's text messages, emails, or other types of communications.”
Another sure-fire way to create a poor customer experience via email: failing to demonstrate a clear pay-off for opting in to an email marketing program in the first place. “Most of the time people are OK with giving [email] information, but a brand needs to communicate the value of opting in,” Kelly advises. “Understanding that [email marketing] is a privilege and not a right is something that brands need to be mindful of.”
Frequency and timing can also play a key role in the effectiveness of direct mail. For instance, Willard says that Super Shoes recently discovered “a highly targeted list” of customers who tend to make late-season purchases. After carefully examining customers' buying behavior and history, Super Shoes learned that these customers were typically slow to adopt new fashion trends.
So, Super Shoes launched a direct mail marketing campaign in early spring that “featured products we were confident would be high-value items to ease [our customers'] stress or anxiety about purchasing,” Willard says. In addition to featuring offers on products with high test sales, such as sandals, Super Shoes' direct mail campaign messaging included words such as “best-selling.” The retailer chose “confident terms that reinforced the stability of the purchase,” he says. The result: a double-digit conversion rate that Willard says exceeded expectations.
But even the most carefully crafted campaign can result in a poor customer experience if the channel isn't the right fit. For example, because of its “less technologically savvy audience,” Willard says, “mobile is a delicate situation for us.” Marketers need to consider not only factors that impact the customer experience such as content and frequency, but also should determine which channel is most likely to deliver the most value for their customers.
Keep your promises…or else
Behind every personalized email message, tailored tweet, and direct mail offer is a promise to the customer. Unfortunately, while marketing communicates this brand promise, it doesn't always have control over its delivery. Everything from a tardy service technician to a merchandising malfunction can negatively impact a brand's ability to foster a positive customer experience.
“It's about the due diligence of any promise you make to a customer, whether that's an offer, a message, or a statement,” says Rhonda Basler, director of customer engagement at Hallmark Business Connections, the B2B arm of the Hallmark Cards brand. “You have to do your homework to make sure you can deliver on it. It's the simple fact of, if you say you're going to do something, make sure you're able to do it.”
Temkin Group's Temkin agrees. “Ultimately, really good companies fulfill the promises they make and strong brands have a lot of coherence between what they say their brand is and how they treat their customers and employees,” he says. “If you have a company where the experiences are letting down what the brand marketers are saying, then the brand marketers have to step back.”
Fortunately, Temkin says, there are steps marketers can take to ensure that they keep their promises to customers. Collecting customer feedback, understanding customers' needs, re-examining the language they use to communicate with customers, leveraging data to determine where promises are—and aren't—being kept are all strategies marketers can use to back up their brand promise.
Size up loyalty
With U.S. consumers holding 3.3 billion memberships in customer loyalty programs, according to the 2015 Colloquy Loyalty Census, marketers might be tricked into believing that such programs are a sure thing.
But the reality is that many “customers are over-subscribed and are becoming disengaged with loyalty programs,” Baesman's Kelly warns. To create a positive customer experience around loyalty membership, marketers need to follow a few hard-and-fast rules. For one, Kelly says, marketers must first “outline a clear purpose and a vision for implementing [a loyalty program] in the first place.” What does the company want to accomplish with its loyalty program? What structure will the program take? What value will it deliver to customers? Only by answering these questions first can marketers hope to gain traction with their company's loyalty initiative.
Next, organizations need to analyze customer buying behavior and patterns to determine what loyalty looks like for their particular brand. “This is crucial to shaping the program, the rewards structure, and member eligibility, and it provides a roadmap once it's implemented,” Kelly says. After all, a luxury goods retailer's most loyal customers will differ significantly from those of a grocery store chain. Making these adjustments in expectations can go a long way toward creating a positive experience.
Kelly also recommends adding brand advocates to an organization's overall loyalty strategy. By turning top customers into rabid fans with tailored messaging and offers, marketers can recruit brand advocates capable of influencing purchases, spreading the word on social media, and garnering greater credibility for the brand.
(Re)master website basics
For all the hoopla surrounding social media and mobile, a website is still a critical piece of real estate for marketers who are serious about creating a positive customer experience. Take, for example, Smartling. “Your website is your number one selling tool, especially in B2B technology,” Marcello says. For this reason Smartling's marketing campaigns often center on delivering links via email, mobile, or social media that then lead a prospective customer to its website. Upon arrival, these visitors are encouraged to click on a link to experience a software demo of Smartling's top products. “We use these channels to drive people to the demo because, ultimately, we're cutting to the chase and allowing customers to get as hands-on with our products as possible.”
In fact, this intimate interaction is exactly what a positive customer experience is all about. Long gone are the days of simply nudging consumers through the sales pipeline. Rather, “what we're ultimately trying to do is create an interaction,” Super Shoes' Willard says. “It doesn't have to be a conversion to a sale. Often, it's whether or not our message has been shared, whether the video has been seen, and whether the post has been liked.”