When you’re growing a business, it’s easy to focus on the tangible things like inventory, shipping supplies, advertising, and other standard business dealings. What many people don’t think about is customer engagement: how your customers interact with your brand.
Here are some of the reasons why you should start paying attention, and start measuring your customer engagement right away:
Did you know that it costs 5 times as much money to acquire a new customer as it does to retain an existing customer? Studies have shown that increasing customer retention by just 5% can boost your profits anywhere from 25% to 90%. It is significantly more cost effective to reward the loyalty of existing customers than to go hunting for new ones.
2. Customer Engagement Predicts Profitability
While most businesses rely on sales and profit numbers to measure success, customer engagement and loyalty are a much better indicator of long-term growth and profitability. While profits can go up and down with seasons or with general market conditions, engaged customers will start spending when things become more viable. Even if your profits appear to be taking a brief dive, as long as your customer engagement is strong, you probably don’t need to panic.
3. Engaged Customers Advertise for You
The best thing about engaged customers is that when they are actively engaged, they will advertise for you in the form of testimonials and recommendations. Customers like having their voices heard, and when a friend asks for a recommendation, they’re more than happy to provide. They will often share on community groups and with friends and family when they’re pleased with a brand.
4. Customer Engagement Lets You Take the Wheel
The best thing about measuring customer engagement is that it can put you in a position to actively change how your customers interact with your business. By responding to the metrics, you can increase engagement and customer loyalty in a targeted manner, letting you get the most out of the time you spend on your social media marketing. If it seems like too much, consider investing in an online course that will teach you how to measure and use customer engagement as a tool to grow your business.
5. Engaged Customers Predict Problems
When your customers are engaged and interact with your brand via social media, they will send up red-flags long before your finances indicate that you have a problem. In fact, the first indicator that a problem exists can arrive minutes after your product is delivered to your customer. A simple comment like, “The website said it came with batteries but I didn’t get any,” could help you correct the problem before thousands of others have the same problem. If you can get ahead of a problem by either changing the site or tossing batteries in all of your packages, the problem is averted.
6. It Can Show Your Strengths
Spikes in activity on a post or surrounding a specific product can help you tailor your marketing to those things that seem to be generating the most interest. When your customers are raving about something, it’s probably a good idea to ramp up your production or your marketing. Customers will also tell you exactly what it is that they love about a particular product, letting you know which features to improve on.
7. It Can Show Your Weaknesses
On the flip side, measuring customer engagement can tell you when something is getting ready to flop. When posts or products have low levels of engagement, you know that there’s either room to improve, or perhaps to get rid of an item or service. Customer complaints can reveal problems with your shipping or return policies, or they can help you identify areas for growth.