What is Customer Engagement and Why is it important?

calendarFeb 7, 2023
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Customer engagement has evolved in recent years as more businesses seek creative ways to attract and retain loyal customers. Previously, simply providing a high-quality product or service was sufficient. However, new data and analytical tools show that customer engagement is a major influencing factor in their purchasing decision.

According to the annual State of the Connected Customer report from Salesforce, 62% of customers say their experiences with one industry influence their expectations of others, and 88% expect companies to accelerate their digital initiatives.

Customer engagement standards are changing, and engagement is about creating seamless experiences that foster trust. 95% of customers say their trust in a company makes them more likely to stick with that brand.

Top priority for businesses in next 5 years

What is Customer Engagement?

Customer engagement is the ongoing development of a relationship between a company and a customer that extends far beyond the transaction. It is a deliberate, consistent approach taken by a company to provide value at every customer interaction, thereby increasing loyalty.

The goal of customer engagement is to provide customers with something valuable in addition to your products and services. Customers are initially drawn to high-quality products; relevant content is what keeps them coming back.

A well-integrated technology stack is required for personalized customer engagement. A connected CRM, for example, provides your company with a single, 360-degree view of every customer. With this knowledge, your teams will be able to use data to tailor content and experiences to the specific needs of your customers, allowing your brand to keep up with rising customer expectations.

Why are customer engagement strategies so important?

Customer engagement strategies are important because they help companies build strong relationships with their customers, leading to increased customer loyalty, higher customer satisfaction and revenue, and an improved brand reputation. Customer engagement strategies also provide companies with valuable insights into their customers’ needs, preferences and behavior.

Finding ways to engage with your customers before, during, and after purchases strengthens their emotional connection to your brand, allowing you to retain current customers while growing your business sustainably.

Often, business owners overlook the fact that the entire customer experience includes the research your customer conducts before landing on your site or products, the purchasing experience, and even after they have received their products. According to insights, “86% of buyers are willing to pay more for a great customer experience.”

Reasons why businesses invest in Customer Experience

Why Customer Engagement Marketing Works?

Customer engagement marketing is a marketing strategy that sends consumers messages that are timely, relevant, and personalised. The personalization element distinguishes it from other marketing tactics. Customers will feel like engaged members of your brand’s community if the content is relevant.

Customer engagement marketing works because it relieves the pressure on a single team to provide an exceptional customer experience. This type of strategy encompasses the entire customer journey and every team within your company that supports it — from customer service to operations to marketing.

The Benefits of Customer Engagement

Customer engagement takes time, resources, creativity, and patience. However, it is a worthwhile investment that businesses should not overlook. Let’s look at some of the advantages of having a strong customer engagement strategy.

Benefits of Customer Engagement

1. Improves Customer Relationships

Effective engagement strategies enable you to connect with and consider the needs of your customers from initial awareness to purchase and beyond. Businesses can build trust and rapport with their customers by engaging with them.

Customers who believe they can put their trust in a company are more likely to do business with it. As a result, customer engagement is critical for businesses that want to develop strong, long-term relationships with their customers.

2. Enhances your online presence

Customer engagement is a crucial aspect of a successful digital marketing strategy that can drive growth and enhance your online presence.

By actively engaging with customers and building relationships, a business can boost website traffic and improve its search engine optimization. Strategic customer engagement can also lead to an increase in social media following, further expanding the brand’s reach.

Xoopah’s top GMB optimization services make sure that your Google Business Profile is optimized for excellent engagement and conversions. You can update your Google Business Profile with Xoopah to increase brand awareness and reach.

3. Boosts Loyalty and Customer Retention

According to a study conducted by Bain & Company and Earl Sasser of Harvard Business School, increasing customer retention rates by just 5% can result in a 25 to 95% increase in profits.

Strategic customer engagement will ensure that you are always aware of how your customers feel about your product or service, the qualities that they value, and any areas that need to be improved to provide a better experience.

Customer retention is critical to the success of any business because it costs five times more to acquire a new customer than it does to keep an existing one. In order to succeed, businesses must find ways to engage their customers and build loyalty.

Customer Engagement Boosts Customer Retention

4. Uncover Up-Sell Opportunities

You can easily promote and sell products with additional features if you have a loyal customer base. In general, selling to an existing customer is easier than selling to a new lead. In fact, the likelihood of selling to a new prospect is only 5-20%, whereas the likelihood of selling to an existing customer is 60-70%.

Upselling saves time and money, and it can help you earn a profit faster. You can quickly assess product performance and identify up-sell opportunities by using consumer trends and data, such as recommending products that are frequently brought together or purchased by similar buyers later.

5. Streamlines the Sales Funnel

Customer engagement is critical to streamlining the sales funnel. You have a better chance of success when you reach out to hot leads and follow up with offers, discounts, and information.

One method is to use AI-powered insights to remove some of the guesswork from your sales process. For example, AI can assist you in learning more about your customers’ attitudes as they enter the sales cycle, their priorities, and what it may take for them to decide. You can use this information to make your sales conversations more effective. Send timely communications and offers to assist them in deciding sooner.

6. Gain Insightful Customer Feedback

Engagement with customers is a two-way street. You want to inform your customers about company news, products, and promotions. However, you must also listen to what your customers have to say about their experiences, both positive and negative.

The entire purpose of feedback is to improve your brand, products, or customer experience. Make it clear to your customers that you value their input.

Xoopah’s Interaction and Review Management Platform allows you to communicate conveniently at every touchpoint of the customers’ journey and enables your business to convert visitors, gather feedback, and collect reviews- efficiently and effectively.

Examples of Customer Engagement

Examples of Customer Engagement

1. Making a complaint

By making a complaint, customers can share their concerns and provide valuable feedback that can help the company improve its products or services. This type of engagement is crucial for building trust and loyalty between the customer and the company.

Additionally, it helps companies identify areas for improvement, increase customer satisfaction and retain customers.

2. Reviewing on a third-party site

Reviewing on a third-party site can be a powerful tool for customers to voice their opinions and engage with a company in a meaningful way. This type of engagement is a valuable source of feedback for companies, as it provides an honest perspective on their offerings.

Positive reviews can help companies attract new customers, while negative reviews can highlight areas for improvement. Customers who write reviews on third-party sites can also influence the purchasing decisions of other potential customers.

3. Using online support and customer service

Using online support and customer service is a convenient way for customers to receive assistance with questions or issues. This type of customer engagement can happen via live chat, email, or a company’s help centre.

It allows customers to quickly receive support and improve their experience with the company and enables companies to provide real-time support and improve customer satisfaction.


Customer engagement platforms are invaluable tools for creating a satisfying customer experience. With feedback and data, you can develop a flexible, responsive approach to customer engagement that converts leads and retains customers. You’ll also learn new things that will help you upsell and streamline your purchasing cycle.

Sign up now to learn how Xoopah can help you better engage customers.