CEU Trends Report 2007

trends report  ’07

Customer Eng agement

www.cscape.com

Customer Engagement: trends report ’07

Contents

Introduction

One

Customer Engagement - Richard Sedley

Two

Right Touching - Dave Chaffey

Three

Corporate Social Responsibility - Rob killick

Four

Persuasion - Richard Sedley

Five

User Generated Content - Clare O’Brien

Six

Podcasting & Audio Branding - Simon Barnett

Seven

Search Marketing - Dave Chaffey

Eight

- Dave Chaffey

Nine

Findability - Lynda Rathbone

Ten

Subscription - Alexander Kohlhofer

Eleven Brand - Ed Lloyd-Williams Twelve Web2.0 - Richard Sedley

0of12 No.

Welcome to the cScape Customer Engagement Unit (CEU) 2007 Trends Report. 2006 was an exciting time for all those involved in the CEU. We were working behind the scenes for eight months building up a series of project wins and exemplary case studies ready for the Unit’s launch in November 2006. Accompanying the launch, the publication of our Online Customer Engagement Survey Report provided an essential insight into how organisations are undertaking the task of customer engagement.

However, the ‘problem’ with survey reports is that they need to be objectively based on the results gathered. It wasn’t appropriate for us to include our own experiences, opinions and prejudices.

The Trends Report in front of you has given us the opportunity to let loose. Each of our CEU consultants has offered their take on what has been important in the last 12 months, and what they feel will be central to engaging your audience in the next 12.

We hope you find it stimulating and insightful and look forward to being held to account in 2008.

Do let us know what you think of our thoughts and keep in touch because we have some very cool events planned for the coming months.

Richard Sedley cScape Customer Engagement Director r.sedley@cscape.com

Contact the cScape CEU >

Customer Engagement: trends report ’07 Fig.2 (Outer circle ) How central ar e personalised experiences to engaging your au dience?

Essential 50.75% Useful 44.40% Not important 4.85%

Richard Sedley Introduction

November 2006 saw the launch of cScape’s Customer Engagement Unit (CEU). To coincide with the launch we sponsored the world’s first Online Customer Engagement Survey. Over 800 respondents undertook the survey to produce an invaluable snap-shot of the current state and aspirations of our industry.

Fig.2 (Inner circle ) How much does your organisation pe rsonalise the ex pe rie nce for online users?

Completely persona lised 1.77% Quite heavily perso nalised 9.89% Lightly personalised 47.7% Not personalised 47.7% Not relevant / Don’t know 3.19%

1of12 No.

CUSTOMER ENGA GEMENT

The survey revealed a significant gap between the customer experience organisations are aspiring to deliver, and that which they are providing in practice. Almost two thirds of company respondents (64%) believe that joined-up online and offline experiences are essential for engaging with their audience, but 60% are either not very advanced at mapping customer experiences and identifying touch-points (36%), or admit they have to start looking at this because they are not doing it at all (24%).

Half of respondents (51%) believe that personalised experiences are essential for audience engagement, with a further 44% believing they are useful. Despite the perceived importance of personalisation 37% of company respondents are not providing it at all.

2007 will be a watershed year for businesses in terms of the way they react to the multi-channel challenges they face. Many businesses will jump on board customer engagement strategies; and will progress towards developing personalised ‘conversations’ with, and seamless experiences for, their customers. Those that keep their distance are likely to fall behind.

Request a free copy of the Online Customer Engagement Survey Report >

Customer Engagement: trends report ’07

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Introduction

‘ Right Touch ing’ means t he right offe at the right t r, ime with the right frequen cy

’’

Dave Chaffey

RIGHT TOUCHING

WITH EMAIL

In 2006 I coined the term ‘Right Touching’ to find a way of highlighting one of the biggest challenges in online customer marketing. In an Email Marketing context, ‘Right Touching’ means delivering the right offer, at the right time, with the right frequency and interval using the right medium for each individual list member. Easier said than done! If the frequency is too high, you risk alienating the majority of your list, but if your frequency is too low, the risk is that returns will fall.

Right Touching becomes really powerful when you use web analytics for a ‘sense and respond’ approach to deliver personalised emails via web and email which have that perfect context for the right point in a customer’s lifecycle. In ’06, clients we have worked with to create personalised web, email and direct mail touch strategies have seen great returns from a structured analysis approach.

To refine touch strategies further means going beyond simplistic overall campaign reports of opens, clicks and sales to testing and reviewing the responsiveness of list members, by their e-retail lifecycle stage, demographics, RFM cell, and channel preferences integrated across the whole year (rather than for individual campaigns). Through a more granular approach, we see that some list members are less responsive to email, so we can test decreasing the frequency, enhancing the offers, changing the messaging or placing greater weighting on direct mail in order to gain better response from these members.

For 2007 I see the biggest rewards for those who can deliver personalised search, web and email experiences, based around understanding individual customer’s needs. Marketing automation, is what’s required; building rules to deliver experiences and results which sync with the customer’s needs, not a marketing campaign timetable.

2of10 No.

Get touched right >

Customer Engagement: trends report ’07

Rob Killick Introduction

Fig.1 How centra l is communicatin g your organisation’s co rporate responsib ility? Taken from the 2007 Online Customer Engage ment Survey

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Corporate Socia

l Responsibility

All of us are increasingly urged to be accountable for the social effects of our activities – if you are in business of any kind this includes the ethical treatment of your staff and the communities in which you operate. As the website is your front to the outside world, it is imperative that any corporate social responsibility (CSR) agenda is communicated through the digital space. If you run volunteering schemes for your staff, incorporate CSR into your business strategy or measure the social impacts of your work, be sure to tell the world about it on your website.

The web will become the fr ont line for meet ing the grow ing demands for accountabilit y

Essential 21.19% Useful 57.25% Not important 21.56%

3of10 No.

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Demonstrating how your business benefits society is an integral part of branding, which is increasingly about trust-building. cScape’s 2007 Annual Customer Engagement Survey demonstrated that over the next 12 months, web users are likely to see more initiatives from companies to open up channels of communication through social media or so-called ‘Web 2.0 features’. Charities and companies across all sectors are increasingly using these tools to accommodate their prioritisation of transparency. For instance, 35% of the respondents said they are planning to use corporate blogs in the next 12 months; 17% are using them already.

In addition, CSR is seen as a crucial way of engaging customers: 21% believe that communicating their CSR agenda is essential, with a further 57% believing this is useful.

My prediction for 2007? The web will become the front line for meeting the growing demands for accountability. Those that take it seriously will see the potential for brand development, those that don’t, beware.

Talk to us about developing your CSR commitment online >

Customer Engagement: trends report ’07

Introduction

‘‘

Richard Sedley

Welcome to p ersuasion in the era of Web2.0 . The best me thod for achieving engagement The process of pe

rsuasion change

#USTOMER

s the persuader

/RGANISATION To influence a pe

rson to change

their beliefs of

actions

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Persuasion

The thing about customers is they just can’t be relied upon to do what you want. It doesn’t even matter how findable, how accessible, how useable or how interactive you make your website there are still no guarantees they’ll do what you want. In fact a recent survey revealed that ‘60% to 80% of customers who defect to a competitor said they were satisfied or very satisfied on a survey just prior to a defection1’.

If even satisfaction doesn’t offer guarantees what can you do? You can engage and persuade.

Engagement is your only guarantee of future performance with persuasion your best method for achieving it. Now persuasion has had a bit of a bad rep. recently, the concept has been saddled with negative, Machiavellian conatations.

Welcome to persuasion in era of Web2.0, time to change your mind and embrace the P word.

For the cScape Customer Engagement Unit persuasion is about aligning the needs, interests and preoccupations of customer and business, and changing the actions of both parties. The flip-side of the process of persuading a customer that they should engage with you is that you learn and change yourself – your services and your products – to better suit your customers. A win-win situation if you like.

The CEU already has some excellent persuasive case studies under our belt and 2007 will see us exploring these concepts further as we develop ‘Persuasive solutions for demanding times’.

4of12 No.

Listen to Richard’s podcast on Persuasive Design >

Customer Engagement: trends report ’07

Introduction Clare O’Brien

User Generated

Content

The most fascinating thing about the interactive world in 2006 has been the explosive realisation of the importance of user generated content and social networking – exemplified in commercial terms by Google’s YouTube buy but, most strongly, in very human terms. Quite suddenly, thanks to broadband, the majority are online and have embraced the internet as part of their lives. As well as functional banking, shopping, emailing, selling and research, 2006 was the year the internet gained real social traction.

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These are not lonely geeky pursuits. They’re about sharing, reaching out and are respected social currency – posting family pictures on Flikr, building playlists on iTunes, emailing film and ad trailers to your friends, reviewing books on Amazon, commenting on the Guardian’s group blog, telling the truth about that little hotel just off the Grand Canal on Venere.com. 2006 was all about people getting much more comfortable with the medium.

Brands that recognise pe ople come to the internet to ‘do someth ing’ have the opportunity t o truly develo p their equit y.

’’

5of12 No.

In 2007 it will become even more embedded as core functions are increasingly taken up (banking, for instance). Against this background, as traditional television audiences continue to decline, the big brands are struggling to effectively transfer their advertising dollars online. Pull marketing doesn’t come naturally and in the rush to be part of the social medium that’s ‘user generated’ (and controlled) there have been and will continue to be plenty of trip-ups where customers reject staged or even fictional online presences.

Brands that recognise people come to the internet to ‘do something’ rather than passively ‘consume’ have the opportunity to truly develop their equity. In 2007 the best brands will have the courage to facilitate interaction among their customers, to provide really useful online destinations, that respect their customers’ needs and views; producing genuine points of engagement. It’s not so much about technology now as learning to let the brand go. Very exciting.

UGC case study >

Customer Engagement: trends report ’07

Fig.1 Podcast us age amongst or ganisations surveyed in the 2007 Online Cu sto mer Engagement Su rvey

Simon Barnett

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PODCASTING &

AUDIO BRANDING

Key developments in the digital media world in 2006 include the seepage of the word ‘podcasting’ out of the lingo of the early adopter and into the mainstream consciousness of the iPod-owning consumer. Once a new form of media enters the Oxford English Dictionary you know it’s here to stay.

Podcasting: fr om early ado pter to mainstrea m conscio

usness

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Currently use podc asting 17.83% Plan to use podcas ting in the next 12 months 32.95% Never use podcas ting 49.22%

6of10 No.

The take-up of digital radio is one of the great British success stories of 2006 and the radio community is waiting with

baited breath for Ofcom’s decision on who will run the country’s second digital multiplex - insiders’ favourite to win is Channel 4 who are offering to launch a selection of radio channels as diverse and exciting as their TV content.

The cultural impact of YouTube’s merger with Google is yet to be seen, but once all of their rights issues have been sorted out and they include more diverse content, I fully expect this to be a significant contender to the mainstream broadcasters.

My prediction for 2007 is the rise of sites like lastfm.com – a community-based, peer-to-peer radio service which creates bespoke audio playlists for its subscribers. As the sheer volume of available material grows, gatekeeper sites like this will become increasingly important to those who don’t have the time or energy for extensive surfing.

Request a copy of our podcasting case study >

Customer Engagement: trends report ’07

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’’

Forg e it’s G t SEM, n ow oogle Mark eti

ng

Introduction

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Pre-defined p ersistent sea rch and related-conte nt portlets a re a great way of impro ving results

7of10 No.

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SEARCH MARKE

Dave Chaffey

TING

We used to talk about Search Engine Marketing, but Google continued to grow in importance throughout the year with some of our clients now recording over 95% of their search referrals through Google.

Google is now much more open about their approach to ranking sites in the natural listings thanks, in big part, to Google’s own Matt Cutts’ blog, which we use to inform our approach to search within the CEU. Assuming your site is included within the index I see the biggest opportunities for search engine optimization (SEO) as detailed keyphrase analysis and reporting, plus creative methods for automatically generating smart folder content which is useful for both users and search engines. With the importance of internal links to Google, I see pre-defined persistent search and related-content portlets within page template design as a great way of improving results.

Contact the CEU to find out more about search marketing >

Customer Engagement: trends report ’07

Dave Chaffey

BLENDING RICH

MEDIA

Google was also in the news for its acquisition of YouTube. It’s easy to criticize the investment and valuation, but Google’s share price didn’t suffer as it stopped a rival gaining YouTube. This story was vindication for Web 2.0 concepts which blend innovative new technologies with user generated content and participation. But it left many companies who are not media owners questioning how they

should adopt Web 2.0. I think the answer is that online, every

company has to think of itself as a media

owner or publisher in order to engage with

its audience effectively.

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Every compa ny needs to t hink of itself as a media ow ner or publis her in order to engage wit h its audienc e effectively.

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8of10 No.

cScape saw clients engaging audiences with podcasts, blogs and RSS, but others found it difficult to devote the resources to generating and distributing engaging content. Of all the Web 2.0 approaches, I believe blogs coupled with RSS are the most powerful way of engaging online audiences.

Our Annual Online Customer Engagement Survey supported this, with 35% planning “corporate blogs” although I hate that term – blogs should be designed for search engines, customers and journalists in roughly that order.

Read Dave’s blog >

Customer Engagement: trends report ’07

FINDABILITY

Lynda Rathbone

2006 saw the number of people online exceed 1 billion. They’re all hoping to find, not search for, information. Information that’s personal, useful, interesting and relevant to them, with personal being the priority. If your website isn’t set up to deliver content that’s findable by your customers in the way they think of looking for it, then they’ll simply look elsewhere. Understanding their vocabulary and making sure your content is optimised to support it, setting up customer-led journeys through your site based on past behaviour and ensuring there are no ‘dead ends’ in your content are all critical.

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2007 i a we s not jus b t a we site, it’s about ha a b pre v senc bout hav ing e ing

Introduction

9of10 No.

It’s not enough to simply think about offering content on your own site. Many of your customers start their online journeys

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elsewhere before they get to your site. Placing content on other sites to increase brand awareness and drive traffic to your site, positioning your organisation as the expert in your field and becoming an active participant in the many online communities is vital to a good web strategy. 2007 is not about just having a website, it’s about having a web presence. Harness that traffic and make it easy for them to find what they want.

Don’t wait fo r customers to search for you – find the m

’’

My prediction for the new year? It will be all about customer engagement.

Don’t wait for your customers to search for you – find them. Understand where they go, what they do, how they think and how they seek information. Then be there to engage and participate with them.

Contact the CEU to discover the power of findability >

Customer Engagement: trends report ’07 Subscription

Alexander Kohlhofer Introduction

Search is key to the internet - it has been for a while and it will be for the foreseeable future. Unfortunately the very nature of searching always requires the user to have quite detailed knowledge of what he/she is actually looking for.

Subscription is a powerful alternative way to access the vast amount of information on offer. Rather then searching for specific information you subscribe to a trusted source of information. Just like search, subscription is well established and supported already.

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One of the m ain challeng es for 2007 will be mana ging the vas t collection of our valuab le resources

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10of12 No.

For websites not already offering some form of subscription via RSS, atom or email I would make that a priority for the coming months. We need to recognise that for our customers one of the main challenges for 2007 lies in identifying trustworthy and valuable sources, and more importantly, managing and maintaining a vast collection of these sources. How sites help the customer manage their subscriptions is likely to be as important as how they encourage subscriptions.

The danger we need to mitigate against is that of our customers losing control, not because there is too much noise, but because there is a such colossal quantity of potentially valuable signal.

Subscribe to news from cScape >

Customer Engagement: trends report ’07

Introduction Brand

Ed Lloyd-Williams

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2006 saw a giant leap forward in the design and development of web interfaces. Great examples like Yahoo Mail,

Online offerin gs now need to match, or exc eed, the way offline propositions are presente d

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Microsoft’s Hotmail and Flickr indicate the future of front-end development by utilising new technologies like Ajax.

The use of such interfaces has contributed to increased understanding amongst customers of what can be achieved and offered though digital channels. As a by product they have also encouraged intolerance of designs and interfaces that deliver substandard experiences. Indeed online offerings now need to match or even exceed the way offline propositions are presented.

When we introduced Customer Engagement Strategies to the online market place in 2006, we did so aware of the fact that in order to truly satisfy our clients and their audiences, we needed to design propositions and experiences that are not only aligned with each other but also strengthen an organisation’s brand on and offline.

In 2007 the best brands will develop impactful interface interactions that meets the demands of accessibility. This provides a wonderful opportunity to produce compelling, accessible, ‘persuasive solutions’ that can enhance a brand and its reputation whilst maintaining and extending an organisation’s online value proposition.

11of12 No.

Talk to Ed about developing your brand >

Customer Engagement: trends report ’07

Introduction flickr

folksonomies wikis wikipedia delicious social software ajax hotmail

digg

linkedin

netvibes

Web2.0

the long tail

feedster video bittorrent rss amazon mobility blogs skype open api technorati youtube audio itunes css design

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zengarden

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2006 has seen the term Web2.0 enter the mainstream consciousness. While at the end of 2005 Google held 9.5m citations, by the close of 2006 there were 460m. More than four times as many as the Harry Potter, Britney Spears and the Olympics combined. A number of websites (MySpace, Flickr, Del.icio.us) have gained very high profiles epitomising what Web2.0 represents. However the defining forms of Web2.0 (social networking, mash ups, RSS, wikis, blogging etc.) offer great potential for reaching, engaging and retaining audiences for the vast majority of organisations.

Key to utilising this next generation of digital media is an understanding of the context in which they can be used: • Media fragmentation has reduced consumer loyalty • The proliferation of broadband as provided increased opportunities for delivering and measuring interactive experiences and engagement.

• Interactivity has changed the nature of marketing. It is now about sales and customer relations, not just increasing awareness and traffic.

• A combination of the points above, with a relatively ‘cash rich’ economy, is driving advertising revenue to the digital media.

• The above has invigorated innovation in ‘interface’ design providing opportunities for new customer focused products to be created on the back of the digital infrastructure.

• Finally customer expectations and participation has increased on the back of all of this elevating their role in product development and marketing.

The web is n o longer a co mmunication medium, but s the product it self 12of12 No.

Richard Sedley

Web 2.0

Those organisations wishing to benefit from this Web2.0 context in 2007 need to grasp the opportunities with both hands and recognise that the web is no longer simply a communications medium, and as such a cost, but in many situations is the product itself. This is a product that the customer can add life-time value to through participation and co-ownership.

Contact Richard to discuss this subject >