Engagement: firms’ initiatives to occupy the attention of an existing customer by providing special benefits and experiences that go beyond the core offering.
The UW Center for Sales and Marketing Strategy hosted a Designing Customer Engagement Strategies to Increase Customer Advocacy and Performance workshop on Thursday, March 12th. The workshop started at the Burke Museum with drinks and networking, and then the group moved into Paccar Hall for the workshop presentations. Key speakers were Derek Drake, CEO of DriveShop and Colleen Harmeling, Ph.D., a Postdoctoral Research Fellow at the Center for Sales and Marketing. Attendees included representatives from Starbucks, Microsoft, Swedish Medical Center, Sila Solutions Groups, James Hardie Building Products, Accenture, Cats’ Exotics, ACS Technologies, BECU, PACCAR Parts, Geocaching HQ, and many others.
The presentations started with introductions and examples of engagement. Derek Drake spoke about his company, DriveShop. DriveShop is a leader in automotive engagement strategies. Their motto is: “We create driving experiences that inspire people to fall in love with their next new car.” DriveShop works with automobile manufacturers to set up customer engagement experiences for their cars. The company had experienced huge success due to the effectiveness of their customer engagement programs. Derek Drake spoke about the importance of engagement marketing: 96% of consumers who participate in an engagement activity of some sort are more likely to purchase. This element of promotion is growing; In 2015, experiential engagement investments grew 29% for brand marketers.
What is an example of customer engagement? DriveShop was hired by Maserati to promote their new 4-wheel drive car. Through extensive customer and market research, DriveShop decided the ideal place to create a customer experience driving the new Maserati would be Aspen Snowmass. Aspen Snowmass is a luxury ski resort in near Aspen, Colorado. DriveShop developed partnerships with hotels, retailers, and restaurants to display the cars in front. The company hosted “après ski” receptions to schedule drive appointments. DriveShop exceeded their goal of 650 1-hour winter drive experience appointments with a professional driver in 3 weeks. The strategy was so effective that Maseratis were being sold on the spot.
Next, Colleen Harmeling, Ph.D. spoke about the Theory of Customer Engagement. Interest in customer engagement has grown in recent years, and more firms (such as Budweiser, Enterprise, and MasterCard) are hiring Customer Engagement Directors. Firms are switching to service-based models and consumers have a desire for a deep connection with products, that is, they are seeking experiential consumption. Customer engagement can benefit firms by differentiating their product from “me too” products (product that are similar to a competitor’s product in order to prevent that competitor from maximizing their market share.) Also, when a customer has an emotional connection to the brand, rational considerations – like price – play a less important role.
There are two types of engagement: experiential and activity. Both are important because engagement influences the perception of a company’s core offering. Experiential memories are as important as true product performance or brand connections in a customer’s decision to buy. Colleen talked about each of these types of loyalty, their pros and cons, and how to achieve them in detail.
The next part of the presentations was 3 Steps for Engineering Effective Engagement. The first step is to generate data-driven insights, both qualitative and quantitative. Next, firms must design engagement programs, selecting the type of experience, target audience, and designing activity-based and experiential-based strategies. Finally, companies should test the programs on a small scale and make any changes necessary before fully implementing them.
The workshop ended with an invitation to all attendees to join the Customer Engagement Special Interest Group (SIG). Special Interest Groups enable 7 to 10 non-competitive managers interested in the same topic to benchmark and learn from each other and network. SIG’s are led by academics from the Center for Sales and Marketing Strategy, who analyze data and solve problems to help firms achieve their goals.
The Center for Sales and Marketing Strategy’s mission is to align important sales and marketing problems with academic research and analysis techniques to develop strategies that improve business performance and facilitate business-academic collaboration to create and disseminate sales and marketing knowledge. The business model is that businesses get access to academics with deep knowledge in specific areas from around the world and researchers get access to current problems and rich data sets. Workshops and Special Interest Groups are just two of the many ways the Center for Sales and Marketing accomplishes these goals.