Posted June 17, 2010 10:05 am by with 6 comments

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If I were to ask you “how do you measure customer engagement,” what would you say?

That’s just one of the questions that Forbes asked CMOs in a new Forbes Insights report entitled: “The New Rules of Engagement: CMOs Rethink Their Marketing Mix” (free download). And, while CMOs seem to understand the importance of engagement–67% said is was “very” important and 30% said it was “somewhat” important–they can’t quite put their finger on how to measure it.

The chart below highlights the metrics CMOs are using to determine just how successful they are in engaging their customers. Some of them look “about right” but others perplex me.

For example, customer retention and sales aren’t very good measures of engagement, are they? Apple doesn’t do much to “engage” its customers but its retention and sales are through the roof because it builds awesome products. Likewise, just because someone opts-in to your email newsletters, doesn’t necessarily mean they are engaged. They could have filters set up to simply show them the email if you mention a discount coupon.

Perhaps the most confusing stat is the low importance placed on social media activity? Maybe I’ve been sipping too much of the social media Kool-Aid, but wouldn’t social media activity be a very important metric for measuring customer engagement? After all, isn’t that where a company truly gets to “engage” with its customers?

  • I believe many are looking at this in too narrow a fashion. Everyone is trying to assign a dollar values to a Facebook fan or Twitter follower instead of addressing the fact that engagement and interaction that takes place in these mediums and are incredibly important to a brand. Building a relationship with existing and future customers is the true value and strength of social media/marketing. ROI is certainly incredibly important whenever investing, but companies have to start looking at ROR, Return on Relationship, when planning, strategizing and most importantly evaluating social marketing.

    A new study shows that those who are fans or followers of a brand on Facebook or Twitter, respectively, are significantly more likely to buy products and services or recommend the brand to a friend. Specifically, the study by Chadwick Martin Bailey and iModerate Research Technologies found that consumers are 67% more likely to buy from the brands they follow on Twitter, and 51% more likely to buy from a brand they follow on Facebook. Moreover, they’re 79% more likely to recommend their Twitter follows to a friend, and 60% more likely to do the same on Facebook.

    Welcome to the “Age of Influence,” where anyone can build an audience and effect change, advocate brands, build relationships and make a difference.

  • You know, I remember a time when women were confusing to me. I mean, husbands go crazy trying to figure out their wives. I think some of these views of social media just made my wife seem a whole lot less tricky. It is the CMOs and other C-level executives who confuse the heck out of me. o_O

  • I believe Networrk Marketing is the key to making money online but we must know how and where to start.

  • Social Media is in the growth phase, it is yet to play a crucial role in marketing and customer relationship, though marketer’s have already established their presence in the social media platforms, soon they will gain importance when it comes to customer engagement.

  • Then those marketers polled/surveyed are your prototypical “I only know how to engage when it involves selling” idiots. And they probably do not care about what’s being said (Brand Reputation) matters to them also?

    New brands will be crated from social media, and established brands will either embrace it or will be put to rest because of ignorance and arrogance towards social media.

  • Colleen

    Your core question is how to measure customer engagement, which must be based on more than social media involvement. Instead of seeing social media as a good way to measure engagement, I see it as a great way to communicate with already fully engaged customers, who often act as brand advocates.

    Here’s a story that you might find informative on this topic:
    Is Twitter a Useful Customer Engagement Tool?