5 Emails Which Drive Value and Response

We all struggle to create emails that are worthy of being opened.

We have to overcome the instinctive “Delete” reflex by our customers and prospects.

Following are 5 opportunities for emails that provide value, engagement and drive response.

1) Triggered messaging

Triggered messages (meaning those that are personalized, real time, or event related such as confirmations that are sent to subscribers in response to a specific action,) outperform generic emails. One of the reasons these types of emails are so effective is because they are relevant and personalized.

Ideas for triggered emails include:

• Cart abandonment reminders
• Order confirmations or shipping confirmations that include a personal thank-you with a time frame based thank you discount on their next purchase.

Additionally, according to eMarketer, for retailers, triggered emails enjoy an open rate nearly 75% higher than nontriggered emails, while clickthroughs more than tripled.

2) Transactional Messaging

According to the Experian’s “The Transactional Email Report, transaction-related emails, [prompted by] customers’ buying behavior, can provide marketers with great opportunity for improving customer service, gaining repeat sales and deepening customer engagement compared with standard bulk mailings…the average revenue per email is two to five times greater and can be up to six times greater than the all-industry average of $0.13.”

But don’t send “off the shelf” impersonal sales-based emails. Today’s transactional messaging, according to the survey is “branded, relevant and engaging...to take full advantage of the high level of customer interest and brand engagement that naturally follows a purchase.” Ideas for incorporating personalized Transactional Messaging include:

• Re-order reminders, accessory replenish reminders, or sales alerts on products or accessories that obviously relate to a previous purchase.
• Win-back emails for lapsed customers with personalized incentives based on buying history and preference data.

3) Engaging Email Subject Lines

Being engaging is more than just using your recipient’s name. Be relevant. Be “to the point” and deliver on what was promised within the body of the email. These, according to Christopher Lester, VP of sales at Emma, an email marketing platform, are the keys to successful and engaging email marketing.

Ideas for engaging email subject lines:

Lester advises that, “The email subject line is probably one of the most important pieces of a campaign... It's the beginning statement of the story… The email subject line is just a…way of giving the user [a] quick analysis... what is the value of the email compared to the amount of time dedicated to opening and reading the message? ...You're building relationships and making full connections... If you deliver [on] the value consistently, you will never have to beg for an open.”

4) Mixed Media Emails

Mobile is changing many of the rules for email. Marketers must now create messaging that is delivery-friendly to traditional email inboxes as well as those on mobile devices.

Ideas for mixed media emails include:

• Today’s consumer is multi-screen and multi-device. Make sure your email messaging provides a mobile device experience that is as good as your desktop experience.
• Be sure your landing pages are also dynamic so that mobile or tablet users can view your messaging clearly, get to forms, or be able to click with ease.

5) Personalized Emails

There is nothing more engaging than a truly personalized email that is all about you, the individual customer.

Don’t reinvent the wheel. Learn from Amazon how they have taken personalized emails to a new level. The company has the ability to analyze and personalize both online and email content based on preferences, search history and previous purchases. Amazon sends its customers personalized product recommendations that entice a recipient to purchase a previously viewed item.

According to an in-depth white paper from Amazon, “The click-through and conversion rates - two important measures of Web-based and email advertising effectiveness - vastly exceed those of untargeted content.” Recommend that you read this report to gain thoughtful insights on sophisticated and effective personalization.

Driving Word of Mouth Referrals: 5 Research Findings and 5 Tips

The Challenge: Companies rely on customer referrals to bring in new business. But, they continue to struggle to interact, listen, and respond in a manner that provides the engagement and motivation for customers to actually provide those referrals.

Online customer word of mouth interactions and reviews have always been a part of Google, which now has new rules in place that will boost business reviews to a greater degree of importance in 2014. For example businesses will now be able to feature a small 67 character review right under their PPC ad. Additionally, Google will gather and display photographs, comments, and reviews in organic search results if a prior related search had been commenced.

Five new findings regarding word of mouth marketing have emerged from thousands of hours of Voice of Customer research conducted by our firm, ERDM;

• Engaging and competitively differentiating customer experiences are the foundations of today’s customer relationships.

• Personalization of content, communications and experiences per customer's individual preferences are proof points that you care about your customers.

• Spray and pray blasts yield ever lower response rates and hurt your brand.

• It’s not about self-serve. It’s about providing customers with guidance and education which provides value and saves time.

• Authenticity, storytelling and emotion are the most powerful elements of marketing communications.

One especially innovative organization that has embraced deep customer engagement is Thrillist Media Group, the leading men's digital media company. They have focused on differentiating themselves through personalization across channels, to their savvy male audience. Per Ben Lerer, Co-Founder & CEO of Thrillist Media Group, "Word of Mouth Marketing has played a huge role in our growth... The key has always been to think about our content creation purposefully: why does someone need this information and how will they be better and have more fun as a result of it."

Examples of how Thrillist has engaged customers to buy and be brand advocates include;

» They refined their marketing lists to identify specific audiences for relevant “This is recommended for YOU” emails sent on selected products.

» They have taken the time to understand the personality as well as the purchasing history of their customers in order to present them with a humorous display of products portrayed to make them “disturbingly more handsome”.

» The company took measures to speak to their customers in a consistent tone and “be the brand” in every channel. And, though each medium was customized for its own unique experience, it presented a concerted and consistent personalized message for its consumers.

This resulted in;

» Increased traffic to the site
» Decreased “unsubscribes” by 50%
» Increased engagement by 15%.

5 Takeaways to Cultivate Customer Referrals:

1. Create methods of direct conversations. Give customers ample avenues to engage in conversations with your company through the touch points of their choice.

2. Develop strategies for active listening. Let customers know that you are listening and that you are giving them empowering levels of knowledge. Customers will not provide a referral if they do not understand the company, the products, or your company’s perceived value. Empower them with the knowledge to go forth and tell others what they’ve learned.

3. Provide a consistent value-driven customer experience. Customer’s own reputations are on the line when they recommend your company to others. By providing them with good customer support, it gives them confidence that others will have the same high quality customer experience.

4. Be humble. Acknowledge what you don’t know about how your customers truly define engagement. Ask for voice of customer insights from your customers and then trust their wisdom and act on their recommendations.

5. Achieve frictionless, high-value, engagement across every medium in the multichannel mix. And, select channels that serve the customer. For example, texting an offer is intrusive, but using text as a reminder for something they want is value.

Montreal Transit's Innovative App Drives High Engagement

Direct Marketing News (DMNews.com) Feature Story.

Deep consumer insights and personalized messaging and offerings are now essential requirements for marketers. But many companies are just beginning to understand the unprecedented opportunities that deeply connecting with consumers for engaging experiences can bring.

Today, engaging customers through ongoing, personalized, experience-based interactions is the key to developing loyalty and future sales.

Findings from our VoC (Voice of Customer) research indicate important new requirements for customer engagement:

• Customers expect companies to maintain engagement and value throughout their lifecycles, not just during acquisition and renewal.
• Marketers must improve the customer experience across every point of contact with their organization.
• Customer experiences apply to all elements of the media mix and all departments within an organization.

In a powerful customer engagement experience, customers:

• Discover and share information about your company
• Learn about your products
• Receive personalized offers and communications

To make this happen, companies need to:

• Learn the most effective ways to monetize opportunities
• Respond quickly to match inventory to customer demand
• Be nimble enough to rapidly refine offers based on customer insights
• Prep sales and other departments with critical customer information

Making the commitment to a customer experience strategy

According to  “The Integrated Customer Experience Report 2013” by eConsultancy, a survey of nearly 900 companies and agencies, data systems and processes are still the primary factors that hold companies back from improving their customer experiences. Additionally, the complexity of customer experience marketing leaves many respondents unsure of where and how to begin. Consider:

• Fifty-eight percent of companies are still only developing strategies in this area, compared to just 20% of companies with well-developed strategies.
• While more than half of the respondents see data (63%) and systems and processes (54%) as critical areas for delivering integrated customer experiences. Most companies have inadequate capabilities in both areas.
• Nine out of 10 companies say improved customer retention/brand loyalty is a benefit of integrated customer experiences, but just more than half of companies surveyed (54%) have the means to measure retention and loyalty to quantify their experience marketing effectiveness.

Experience marketing drives engagement

I recently saw a presentation by Layla Sabourian Tarwé, senior product marketing manager, global marketing, at SAP, whose main focus is to help drive consumer engagement initiatives at SAP. During the presentation she explained how Société de Transport de Montréal (STM) leveraged SAP's Precision Marketing software to develop a new interactive mobile app call Merci.

Layla had these important insights to share about best practices regarding the customer engagement experience: “Marketers need to embrace change and understand the value of connecting with consumers in innovative new ways. The first step in engaging consumers more deeply is being able to generate deep insights about their preferences and preferably, in real time.”

Layla added this key point, “But now with all these new channels, we're at the point where we're actually starting to have too much information. The key is being able to analyze massive amounts of data from multiple sources to create a 360-degree view of each consumer and then act on these insights in real time. As consumers have started to use new channels, their expectations for how marketers should engage with them have increased dramatically.”

In fact, through co-innovation with SAP, Société de Transport de Montréal launched its Merci app to help improve its customer experience. Merci presents customers with exclusive, personalized offers based on their profiles and preferences. The program offers participants instant gratification without having to work or wait to collect points.

“STM wanted to avoid being ‘just another loyalty card that collected points.' It wanted to build an ecosystem of partners and offers that would ‘reward users on the spot' for their continued loyalty,” said Pierre Bourbonniére, STM's head of marketing. “In the backend, STM's ability to segment geo-localized promotions ensures that notifications are a match with the commuters' demographics and personal preferences, information they have volunteered in return for relevant offers. Whether they're waiting at a bus stop, or just enjoying the ride to downtown attractions, these customers access our award-winning mobile app—STM Merci—to to benefit from relevant offers—as well as a reward scheme—that respects their privacy and personal tastes. The program, which connects directly with commuters on the move, has the potential in all verticals, not just transport, to seek new ways to use mobile to reward individual consumers for their loyalty.”

STM encouraged riders to download the app and complete preference information about their interests. Half of the riders chose to complete their profiles.

STM designed the app to adhere to strict Canadian privacy compliance regulations. The back-end of the application splits commuter data into two separate databases, with key personal details "de-identified.” 

What marketers can learn from the Merci app 

• The app allows STM to create and shape demand in real time and adjust marketing campaigns for partner organizations to maximize their ROI, instead of waiting to analyze their effectiveness.
• The app enables the company to rapidly match supply to a changing market and optimize inventory levels and product assortment based on the latest consumer demand data.
• It allows for the development of new offerings and business models—using consumer insights to refine existing offerings, uncover new consumer needs, and create new monetization opportunities through an incentive to travel more often or switch to an annual subscription.
• Customers are able to receive geo-located offers based on wherever they happen to be.

And customers value this service. The click-through for the Merci app has been four-times greater than industry averages.  

Key takeaways for developing your customer engagement experience

• Customer engagement experiences need to be highly personalized. Immersive experiences such as social media need to cultivate a sense of connection.
• Consumers engage through a variety of media, so it's essential to give them the option to experience your brand effortlessly across multiple channels. 
• Customers want to receive instant gratification for making transactions, accessing services, and providing feedback any time and on all media of their choice. 
• Companies need to unify and integrate different sources of customer data to deliver consistent experiences at every point of contact.
• Marketers should develop a fully rounded view of each customer that includes history, personalization preferences, usage and future intent information, and prediction of lifetime value.

It's How They Want to Buy…Not How You Want to Sell

The Challenge: Companies that focus on what they want to sell — not how customers want to engage — miss the boat on opportunities to drive initial and ongoing sales.

Dunnhumby recently released results of its Customer Centricity Index (CCI) study which measured how well retailers are responding to the needs and wants of their customers — through the eyes of their customers.

The findings are important for all businesses wanting to better connect with customers:

• Companies with higher CCI scores tended to have higher long-term comparable sales growth over a two-year period.

• True understanding of what drives a customer to a brand is an insight that differentiates category leaders from competitors.

• A strong customer experience that meets customer needs had the strongest impact on customer centricity and highest CCI scores/rankings.

• Price was important to customers but was less about "lowest price" and more heavily tied to perceived value.

• Companies that provided the opportunity to give feedback and have interaction were rated higher.

One company that took on the challenge of developing a customer focused business strategy is United Airlines. Starting in 2010 during their merger with Continental they began to build richer customer profiles to increase sales opportunities.

United groups customers by behaviors, such as customers who have been price sensitive. They then use these insights to create more relevant offers such as sending frequent business travelers an offer to purchase an airport day lounge pass, etc.

The company overlays demographic and lifestyle data on customer records and groups them into customer types. United tries to include basic demographic information in each member profile such as age, household income, and net worth, and interest-specific elements such as members who enjoy playing golf.

United's new policies include customer centric actions such as these:

• When a customers is about to reach a milestone, a local representative delivers a hand-written thank-you card to the customer as they scan their boarding passes upon boarding.

• Segmentation that accurately groups customers by behaviors creates more relevant offer opportunities.

Since the initiative was launched, United has been able to convert 4 percent of its non-members to the MileagePlus program, resulting in tens of millions of dollars in additional revenue.

Key Takeaways:

• Show customers that you are "involved" in their buying experience with actions such as a reminder notice about a product or service based on previous behaviors, a thank-you note, a preview of an upcoming sale, a birthday incentive, etc.

• Show customers you are listening by conducting ongoing Voice of Customer-driven assessments of your business and marketing strategies to ensure alignment with customer expectations.

• Increase the frequency of database updates so they reflect the ongoing changes in customer’s needs. Update information regarding preferences, demographics, behaviors, sales purchase history, etc.

New Research: It’s Not About Satisfaction It's About Engagement

The Challenge: Businesses that rely heavily on customer satisfaction surveys as a gauge of overall customer happiness, without an evaluation of total customer engagement, run the risk of losing valuable sales opportunities.

The banking industry has a lot to teach us about how not to get stuck in a rut of perceived customer satisfaction.

According to a recent Gallup poll, "research shows that banks that only consider customer satisfaction -- even extreme “top box” satisfaction -- are leaving significant cross-selling and up-selling opportunities on the table."

•  Less than half (45%) of customers who are satisfied say they would consider their bank the next time they needed a product or service, however, that consideration skyrockets to 83% among customers who are both satisfied--and fully engaged.

•  Customers who are fully engaged and satisfied are also more likely to say they will open new accounts, switch from another bank, increase balances, and add ancillary products than are those customers who are just satisfied.

Additionally an Ernst & Young Survey noted “understanding customer behavior, attitudes and requirements is more vital than ever for banks’ strategic thinking....banks need to reevaluate their assumptions and fundamentally change how they interact with their customers.”

HMS National, the Florida home warranty marketer, used Voice of Customer Insights to increase customer engagement and boosted renewal rates by over 50%. VoC learnings helped them develop more effective strategies for engaging customers throughout the customer lifecycle, starting at the moment of enrollment.

Another company which understands that engagement equals customer loyalty is Discover Card, which has led the credit card industry in customer brand loyalty for 17 consecutive years, according to an annual study by the independent research firm Brand Keys, Inc. The research found that emotional engagement is the dominant driver of purchase decisions and brand loyalty.

This is evident in Discover’s Cashback Connection page, which notes “for every reward there’s a story. We want to know what Cashback Bonus means to you.” This tactic humanizes a company benefit and ties it directly back to the consumers using it.

Click here to sign up for Ernan's Weekly Insights email.

Three key factors for their success:

•  Discover Card has created the highest levels of loyalty by leveraging real, emotional value.

•  They provide an experience that lets consumers actively engage with the brand so that expectations are created, understood, and ultimately delivered.

•  Discover Card uses the information gained through its strong customer relationships to develop product features that are directly consistent with consumers wants.

Key Takeaways:

» Understand how your customers define satisfaction and engagement, and develop processes and metrics to keep measuring these factors on an ongoing basis.

» Use voice of customer feedback from research, call centers, customer service interactions, sales reports, etc. to develop a holistic view of your customers needs…and use this information to drive  continually improving customer experiences, communications, and offers.

» Establish personal and emotional connections with customers that are both authentic and differentiating.

Making your App a Customer Engagement Solution

The Challenge: Businesses know mobile apps offer tremendous customer engagement opportunities—if done correctly. Unfortunately, businesses can also eat up marketing budgets--without the customer engagement payoff--if mobile apps are not planned out with customer needs in mind.

According to Forbes, the world has gone from 0 to 60 billion mobile app downloads in just the last four years. However, in a Nielsen Research Study, of the 82% of U.S. adults who are now active cellphone users, 43% now have apps on their phones. But, 56% said they delete the apps they don't use, most within two weeks of downloading them.

Don’t be “another” app. Be an engagement tool.

To avoid the dreaded deletion, it is vital to understand why people would want your app, how they’d use it, and why they’d want to return to it.

All too often esthetics or programming issues push their way front and center. But, don’t forget that the best applications do more than look good, they:

» solve a problem

» simplify life

» and engage customers

Based on customer analysis and feedback, T.G.I. Friday’s decided that they needed a way for customers to easily obtain their check, pay, and be on their way. To facilitate this amenity, they developed the “My Friday’s Tab” app that lets customers start a tab, keep track of their bill, and checkout with a click of a button. After its initial release, the company updated the app to include many additional functions that further increase customer interaction and involvement with the brand.

Takeaways: Here’s how T.G.I.Friday’s got it right and how you too can engage mobile customers:

» Solve a problem: The app lets customers pay and go without having to track down wait staff or bartenders. This eliminates customer frustration and also frees up staff for more “fun” interactions with customers.

» Simplify Life: The new app offers access to the rewards program; a “locate a Fridays” function (that also provides driving directions;) customers can get up to date on food and drink specials; and they can review the menu.

» Engage the Customer: The app enables customers to become a part of their own experience at the restaurant. They can have full control over what location they choose to visit, how to redeem reward points, earn new points, decide what to order, and pay without any staff involvement. The app puts its customers in total control of their visit.

If you are going to go through the expense, and effort to develop an app, be sure that it is an app that your customers will want and use over time. Apps are amazing customer engagement tools. (If they are used.)

AmEx: Small Biz Engagement Drives $5.5 Billion in Spending

The Challenge: In a study by the Business Marketing Association, most BtoB marketers say customer engagement is a high priority within their marketing organization (72%), but 43% grade their company’s level of customer engagement, a C, with even more giving their companies a D or an F.

The opportunity for BtoB marketers: successfully engage their customers by establishing new avenues of relevant communication.

Despite such poor self-ratings, 72% of surveyed BtoB marketers cite customer retention and loyalty as their primary reasons for establishing customer engagement efforts. Other motivating factors are recommendations for products and services that match customer needs (54%) and a more compelling customer experience (41%).

A company that has set the standard for BtoB customer engagement is American Express. Not only has AmEx developed events and contests to drive engagement but it has also made itself an invaluable resource to it’s merchant customers with two information-packed websites.

1. Events: In 2010 Small Business Saturday was conceived and promoted by American Express. The goal: drive small business holiday shopping. It is now a year round BtoB commitment. It has set new revenue records each year since its launch, and surpassed all expectations with $5.5 billion in spending in 2012.

2. Contests: “Big Break for Small Business” was designed to transform the way small businesses connect and engage with customers online. It not only rewards 5 winners with an in-person consultation with AmEx and a $25,000 free Facebook ad campaign but it incentivizes engagement by giving all entrants with a $50 Facebook ad credit.

3. Websites: AmEx has established two information packed websites: American Express Small Business which offers tools and advice and Open Forum a place for businesses to share and access the latest business and marketing news.

On its Open website, AmEx states that it “supports business owners with products and services to help them run and grow their businesses” But perhaps the most important thing that AmEx can teach BtoB marketers is to build engagement strategies based on increasing your overall value to your customers.

3 Takeaways to increase BtoB customer engagement:

» Dramatically change your approach from transactional to consultative, by understanding your customer’s requirements and creating solutions that will provide true value.

» Create ongoing interactions and conversations by providing insightful and relevant reports, newsletters, blogs, websites, and research, that transforms you from just another vendor to a trusted resource for both products and information.

» Create opportunities for engagement such as webinars, contests, events, chats, and virtual seminars that put your business in the spotlight as an expert.

Yoplait’s Cause Marketing Deepens Customer Engagement

The Challenge: Companies can deepen their engagement with customers by championing powerful causes. However, in order for these efforts to be effective, customers must feel that your efforts are authentic and truly helping the charity.

When brands are effective with cause marketing, it can also be a win for the product category. Yoplait®’s successful Save Lids to Save Lives®program was ranked number one by shoppers as the brand they purchase most because of its association with a cause. Not only has Yoplait, as a brand, benefitted from high awareness and purchases resulting from the 13 years supporting Susan G. Komen for the Cure, but the yogurt industry as a whole has been elevated. The yogurt category is ranked 5th among products consumers purchase because of their association with a cause.

Keep In Mind...

After selecting a cause for your company that you, your employees, and your customers are all passionate about, the next step is to make sure that not only the charity gets something from the partnership, but that customers feel good about it too.

Click here to sign up for Ernan's Weekly Insights email.

A win-win situation for the charity and your customers should be the goal; this is achieved when customers feel their life is enhanced by the charity efforts and that good feeling is transferred to how they feel about the marketer.

If you are wondering about the financial return on investment, according to Edelman’s annual goodpurpose® study, in 2012, 47% of consumers made purchases from brands that support a cause.

Takeaways:

1.	Ensure that your customers connect with the charity and approve of the way the campaign is executed. When choosing between two companies with similar products that engaged in cause marketing, 70% of those surveyed cited “personal relevance of cause” as the reason they choose one company over another.
2.	Make sure your cause relates to your brand. Coca-Cola, known for polar bears in their commercials and on their cans, teamed up with World Wildlife Fund. Donations from the campaign helped raise awareness for the conservation of polar bears’ habitats.
3.	Be transparent about how you are distributing funds to the cause. Show the results and the progress made as a result of your charity partnership.
4.	Make sure the cause you choose has the highest grades. Research the history and rating of the charity and understand the guidelines, rules, and laws governing companies that make charitable donations through marketing campaigns.
5.	Incorporate social media into your campaign so that donors can share their charitable efforts, thereby increasing the reach. Bing’s partnership with DonorsChoose.org benefited schools with a contest that called for entries through social media. Make sure everyone receives value and reputations of all parties involved are enhanced.

Spike in Email Undeliverables: 5 Tips for Increasing Delivery

The Challenge: Major email providers such as Gmail, Yahoo, Hotmail and AOL have implemented new algorithms for email deliverability based on “engagement”. If your emails are not triggering sufficient interaction, they are likely not to be delivered.

Recently, most email service providers have converted to a new customized algorithm that calculates deliverability using a combination of the original email delivery rules plus new “engagement” factors: open rates, clicks, unsubscribes, and complaints. With these new human behaviors factored into the equation of deliverability, future emails that you send may be considered SPAM or not delivered at all, even to subscribers who signed-up to receive your emails. Email marketing service MailChimp explains an even more damaging point “if enough recipients click the ‘spam’ button on your email, the providers assume that no one else would want that email either.” Read Google’s white paper on deliverability and the Priority Inbox.

What can you do to improve engagement? Here are 5 tactics:

1. At a minimum, follow basic list management best practices, such as keeping your list opt-in only, honor unsubscribe requests and remove undelivered emails from your list. MailChimp suggests using a double opt-in method to further improve engagement metrics.

2. Motivate new customers to engage with you. Silverpop recommends a quality welcome series.

3. The strategists at Econsultancy suggest “Combining behavioral data and RFM (Recency, Frequency, Monetary value) creates Engagement-RFM (eRFM). Using this methodology can improve the accuracy of segmentation, strengthen influence and engagement, and lead to an increased ROI.”

4. Use personalization and dynamic content. Leverage this information to deploy personalized communications for significant events such as customer appreciation messages, unexpected “surprise and delight” communications, birthdays, post purchase “thank-you’s”, and dropped cart messages.

5. Reward email actions like opens, clicks, and shares. Marketing Profs highlights how companies like GameStop and Southwest Airlines are experiencing success with engagement by tracking subscriber’s interactions and awarding loyalty program points.

Key Takeaways:

1. Sending “spray and pray” emails will damage your brand, hurt your reputation, and compromise future deliverability of legitimate emails.

2. Provide value-added information. Per recent findings from recent Voice of Customer research conducted by our firm, customers are willing to provide in-depth information in exchange for receiving value-added information. For consumers, the rationale for providing preference information is to receive increasingly relevant offers, communications, and experiences.

3. Segmentation is more essential than ever. Develop increasingly specific customer and prospect segments so you can send highly targeted emails that are of interest to each recipient in your sub-segmented groups.

Burberry: 3 Powerful Ways To Engage Consumers Online

The Challenge: According to a study conducted by Martini Media, luxury brands have been gradually dropping TV from their multichannel marketing mix in favor of digital media. But will the move pay off in the end? Digital darling Burberry seems to think so, quickly taking the throne of luxury online marketing by creating entirely new levels of customer engagement.

While luxury marketers have traditionally trailed mass marketers in digital marketing spend, digital media has skyrocketed among luxury agencies over the past year. Context and targeting are quickly becoming the most important criteria for luxury brands, and luxury marketers are finding a need to achieve reach through the use of niche, passion-based sites.

Digital media is perceived to be more effective than offline marketing in driving favorability, as well as online and brick-and-mortar traffic. It appeals to affluent audiences on the go, who often have more money than time. And because luxury brands must deal with an extremely niche audience that is more privacy-sensitive and difficult to reach, these customers expect an engagement experience that mass marketers aren’t capable of delivering.

With its highly successful push into digital media earlier this year, Burberry has become luxury online marketing's champion. Creative officer Christopher Bailey claims it’s become “as much a media-content company as a design company.” As proof, the company has launched its recent AW(Autumn/Winter) 2012 collection across 10 different social platforms, tailoring the presentations to best leverage the advantages of each site.

Key Takeaways from Burberry

1. Use co-creation to drive brand awareness and engagement through
user-generated content.
Taking a cue from Threadless, Burberry’s Art of the Trench photo-sharing site allows consumers and fashion photographers to document how they wear the brand’s iconic trenchcoat. This unique use of user-generated content and customer engagement has generated a massive amount of brand awareness for the company.

2. Make your consumers feel exclusive by showing them exclusive content.
In its recent “Tweetwalk” event, Burberry partnered with Twitter to post backstage pictures of every look before models were sent out onto the runway, which meant that Burberry followers were seeing looks before most members of the fashion show audience.

3. Design your content to help guide your customers down the purchase path.
In a fresh twist on direct sales, Burberry live-streamed its London Fashion Week catwalk to 25 main stores as a “living catalog,” allowing existing customers to place immediate orders on upcoming collections before the looks became available to the public. Burberry also made it possible for consumers to directly purchase items by clicking through any of the image or video galleries on their social media posts.

Failure to Engage with Social Media Will Reduce Revenue and Increase Risk

The Challenge: Social media platforms are crucial to building customer engagement, but the vast majority of marketers haven’t incorporated that reality into their daily workflow—with outsize consequences to their bottom lines.

A recent study by IBM found that while more than 80 percent of CMO’s track traditional information sources, only 26 percent of CMO’s track blogs―to say nothing of newer platforms like Facebook and Twitter.

Mila D'Antonio at 1to1 Media described the consequences: "CMO’s who underestimate the impact of more deeply engaging in social media are missing opportunities to grow revenue, expand brand value, and strengthen customer loyalty."

This disconnect costs businesses money.

Last week, American Express released their 2012 Global Customer Service Barometer. They found that consumers who use social media for customer service are significantly more valuable than the general population.

Socially engaged customers:
 • Are almost twice as willing to spend more for excellent service than the general population.
 • Are nearly three times as likely to communicate positive customer service experiences.

But there's also a risk.

The flipside of socially engaged customers:
 • They are over 50 percent more likely to cancel an intended purchase because of poor customer service than the general population.
 • They are over twice as willing to share negative customer service experiences. 

CMO’s cannot take advantage of the opportunities created by social media – or mitigate the risks – if they are not engaged participants themselves. As D'Antonio wrote, "Today’s CMO’s Should Be Social Media Socialites, not Wallflowers”.

BEST PRACTICES FOR SOCIALLY ENGAGED MARKETERS:

→ Establish Social Media KPIs
For too many CMO’s, tracking social media is an afterthought. To break this pattern, socially engaged marketers need to establish Key Performance Metrics (KPIs) for every social channel they engage, and build an organization that optimizes them.

→ Track the Online Conversation in Real Time
Even if you’re not on the major social media platforms, your customers are—and they’re talking about you. Build a rigorous process to track your online reputation in real time, even on platforms you don’t actively engage.

→ Expand PR Beyond Traditional Platforms
Marketing and PR efforts must be closely aligned, in traditional media and new. Traditional press releases and media blitzes still have their place, but an effective PR organization needs to spread the word on Facebook, Twitter and beyond.

Are You Engaging and Empowering Your Customers?

THE CHALLENGE: Consumers have shifted from being passive recipients of “push” marketing to selecting companies who seek their voice and reflect their input. Engaged customers offer exponentially greater value than passive buyers.

Seek Out and Act On Customer Input

At Adobe, customers have the opportunity to submit ideas and vote on ideas submitted by others in the “Labs Ideas” forum. Analysts at the company discovered that customers with the highest feedback scores also had the highest lifetime values. Differences in lifetime value among key business accounts were as high as 288 percent. And according to Sloan Management Review, 95 percent of customers at the community-driven on-line apparel retailer Threadless.com had previously voted and made comments on the site.

Recently, the online music service Songza launched “Music Concierge” in response to learnings from in-depth Voice of Customer (VoC) research regarding what listeners expected from a high value music experience. Songza, backed by Amazon, among others, is one of the most innovative new players in the digital music space. (Full disclosure: Songza's CEO, Elias Roman, is my son)

Songza’s Voice of Customer (VoC) Research Learnings:

#1: Existing streaming services were too difficult for music fans.
While music aficionados were thrilled to discover services that offered infinite variety, most music fans were overwhelmed. According to Elias Roman, CEO of Songza, "We gained valuable insights regarding what people want from a music service ... They found other services too hard: the enormous selection they offered was lost on them, because they didn't have the time, knowledge or inclination to navigate it."

#2: Music fans wanted soundtracks for specific activities.
The major discovery of Songza's VoC research was that people associate music with activities in their lives and want music discovery to reflect that fact. "Some customers told us that they were much more productive with film scores on in the background. Others would mention specific playlists that helped them run their best mile ever." Songza responded by launching Music Concierge, which provides situationally-appropriate playlists, pre-filtered based on the time of day, day of the week, user device and observed preferences. They range from “Just Waking Up” on a Wednesday morning to “Hosting a Cocktail Party” on Saturday night.

The result? A recent headline said it nicely: "Spotify, we need a break. I'm falling for Songza."

Per Elias, “Music Concierge impacted our metrics in a big way. New users are spending an average of 45 minutes on the site. No other new feature has given us such a big boost to traffic or engagement, which has nearly doubled since we introduced concierge.”

Key Takeaways for Marketers:

»  Update Your Understanding of Customer Expectations More Frequently than Ever Before. The speed of change in what customers expect and consider to be competitive differentiators is unprecedented. Marketers that are too slow to respond are losing market share. If you haven't recalibrated your understanding of customer expectations within the last 12 months ... you are out of date.

»  Empower Customers by Making Changes Based on their Input. Songza’s VoC research revealed that customers wanted guidance, and Music Concierge provides it. Nothing makes customers feel more empowered than seeing you make changes as a result of their feedback.