Customer Engagement Metrics You Should Track Now
Today’s businesses have a plethora of digital tools at their disposal to attract customers, from blogs and social media to live chat plug-ins. However, what is the use of a tool if you don’t know its impact? That is where tracking customer engagement metrics comes in handy. From your website to your products themselves, understanding how customers are interacting with your business is essential. When you understand customer engagement metrics, you get actionable insights into how to improve your product, marketing, and even customer retention.
Importance of Customer Engagement in 5 Statistics
According to Rosetta Consulting, highly-engaged customers buy 90% more frequently and even spend 300% more compared to other customers.
Another study from Gallup has found that such customers contribute to a 23% premium in profitability, revenue, and relationship growth.
For B2B customers, better engagement also translates into 68% lower attrition and 50% higher productivity.
Engaged customers are more loyal, make fierce brand advocates, and in general, are great for business. When you measure customer engagement using certain key performance indicators (KPIs), you can feel out the market. Though sometimes considered “soft” metrics because they don’t directly enhance revenue or returns, customer engagement metrics are valuable to marketers and business strategists alike. Engagement metrics tell you how invested customers are in your business.
Measuring Customer Engagement
Customer engagement refers to any interaction a customer has with your business. There are many different metrics that can be used to measure customer engagement. However, different companies have different definitions of what an engaged customer is. This is why you need to find the right engagement metrics for your business.
For instance, SaaS companies require users to create an account to track their active or dormant status. However, e-commerce stores find that cart abandonment rates are a better metric to understand customer churn.
Based on the nature of your business, you can mix-and-match the KPIs that give you the complete picture of your customer. But before that, it’s important to know all the metrics that are at your disposal before you make your pick.
Internal engagement metrics track a customer’s interaction with your business directly through your product, website, or app. External engagement metrics reflect customer engagement on third-party platforms like social media, through emails, or other websites.
Key Internal Customer Engagement Metrics
Engagement metrics built into your product’s interface are effective indicators of whether customers find value in your offering. These metrics can be a part of the user platform to understand how your customer interacts with your product or service.
Measuring active users of your product can show you how many unique customers log in to use your offerings. This metric is typically monitored over a temporal window: daily, weekly, or monthly. As a business, you can choose a window that works best for your specific product. For example, your business can choose to track monthly active users to understand customer attrition and retention on a month-on-month basis.
Product Engagement Score
Just because a customer is logging in to your product doesn’t necessarily mean they are actively engaging with it. This is why a deeper analytical measure like a product engagement score (PES), can be a better indicator of product performance. A PES is usually calculated by defining important events/ customer actions for a product to be deemed effective, and then assigning corresponding weights to completed actions, to compute a score. For instance, a customer using a new feature in your SaaS product may be of higher importance than using older features. By assigning a higher weight to the first activity, you can draw up different customer engagement profiles.
Here’s what a monthly PES table may look like:
In this example, Customer 2 will be more valuable to the company. Changing weightage would change the score.
Product Adoption Rate
Product Adoption Rate (PAR) measures new usage. It can help perceive the success of your product and the potential growth of your business.
Product Adoption Rate = (No. of New users / Total No. of Users) x 100
For instance, a company calculating PAR may use new sign-ups to measure this metric. Adding 100 new users in a month to an existing customer base of 1000 gives a PAR of 10%. PAR can also be feature-specific. Applying PAR to features can provide a deeper understanding of what aspects of the product are actually successful among customers.
Activation rate is a measure that helps companies figure out how quickly new customers are engaging with a product. Using a benchmark of certain actions that users must complete within a time frame, companies can determine user activation rate. For instance, an e-commerce company may use product notifications and purchase within two weeks as indicators for the activation rate. A customer meeting both these criteria would indicate successful onboarding.
Keeping track of returning customers is good for all businesses. A returning customer is anyone who has made two or more purchases from your business.
Returning or Repeat Customer Rate = (No. customers who’ve purchased before/Total no. customers) x 100
This metric is a solid indicator of customer retention.
Feedback Response Rate
Feedback response rate measures the number of times customers provide feedback in relation to the number of times asked. For instance, if a customer rates their experience twice out of 20 times, their response rate is 10%. For service-oriented companies, like delivery apps, feedback response rates are essential to understand not just engagement but also service quality.
On page customer engagement metrics
In today’s digital era, customers engage with businesses through different channels. Even back in 2016, a Harvard Business Review study found that 73% of customers use multiple channels while shopping online. A company’s website may be a sales tool or simply informational. However, especially for marketers, tracking website KPIs can reveal a lot about the efficacy of their efforts.
Non-Interactive Page Metrics
Non-interactive website metrics track how many users land on your website. Even when there is no direct communication, passively engaging a customer through your website can generate leads. Google Analytics is a great tool to measure non-interactive engagement.
Pageviews track traffic on a website. It indicates how many people visit your website. A growing number of page views can indicate many things, from a high interest in your company to good SEO and content marketing practices. However, this metric does not differentiate among users. The same visitor could load the page multiple times and it would still count as a separate view. Instead, also tracking unique page views and average sessions per user can be a more holistic metric of customer engagement.
Time on Page
Compared to page views, time on page tracks the duration a user spends on a page. A user could open your site and leave immediately if they don’t find its contents useful. According to Chartbeat, 55% of users spend fewer than 15 seconds on a page. When a customer spends more time on a page, it can be a fair indicator of how valuable your website’s information is to them, a nod to a great customer experience.
Bounce rate is the percentage of website visitors who leave or “bounce” after viewing a single page on your website. A high bounce rate could mean that either your content or website design is not enough to hook the user to interact with the page. Note that, high page views are of no use if you can’t keep them browsing long enough to understand the value of your product or service.
The page or scroll depth
Tracking page or scroll depth can tell you where you lose your customer’s attention. This metric tracks the point where customers exit the page. While Google Analytics does not automatically track scroll depth, you could install a heat map plugin to monitor this metric
Interactive Page Metrics
While metrics like page views and bounce rates track passive engagement, interactive engagement metrics are more action-driven. For instance, engaging in real-time conversations (via live chat or chatbots) with customers who indicate curiosity for your offerings can lead to higher sales, increased product adoption, and reduced customer churn. Some noteworthy KPIs to track for action-oriented engagement are:
Conversion rate refers to the number of users who achieve a particular goal in relation to the total number of visitors. The goal could be lead generation, demo requests, or signups. Your CRM can track this data for you.
Number of Chat Conversations
Measuring chatbot or live chat conversations can indicate direct user interest. The more chats per visitor mean the more interest your website is generating. Every chat conversation is an opportunity to increase customer satisfaction.
Measuring the duration of chats with a customer be valuable in two ways:
- It can show higher customer interest in your company or product.
- It can also show how well your agents handle customer queries.
The amount of time a customer spends on your chat is an important metric to determine how happy the customer is with your support. Don’t forget to collect feedback at the end of chat sessions to know how your customer feels.
Proactive messages are automated bot messages that can attract user attention. This could be a welcome message, a poll, an external event notification. Measuring the number of proactive messages sent versus the number seen, clicked on, and engaged with can show how useful it is for customer engagement.
Google Analytics does not measure interactive metrics. A customer messaging tool like Freshchat can help you keep track of customer action on your website. In addition to tracking customer engagement, a live chat tool like Freshchat can also boost engagement and offer support.
External Engagement Metrics
Apart from your own platforms, customers may also interact with your company through social media, emails, text, or other online forums.
Social Media Metrics
Research shows that 54% of consumers research products on social media before purchase. Engaging customers on platforms such as Facebook, Instagram, Twitter, or LinkedIn can help tap into an essential customer base: millennials and Gen Zs.
Every social media platform has its own analytics tool to monitor engagement. Facebook Insights helps track page views, likes, and post reach, among others. Twitter Analytics can tell you about tweet impressions, retweets, follower growth, mentions, etc. On Instagram and Pinterest, only business accounts can follow engagement metrics.
Some of the top social media metrics to keep an eye on are:
Likes, shares, comments, and mentions
Tracking these will help you understand how much customers are directly engaging with your social content. These help with brand awareness and relevance.
Impressions and Reach
Impressions track how many times a post appears on a user’s timeline. Reach shows the potential unique users a post can reach. The higher your impressions and reach, the more users your posts can impact.
Followers and Subscribers
Keeping tabs on organic follower and subscriber growth on social can indicate how well your content is being received by the market. Don’t forget to also track the number of unsubscribes.
Just like conversions through websites, social conversion rates are company-oriented actions taken in relation to total impressions. The higher the conversion rates, the better your social profile, on social media a strong CTA can urge scrollers to take action.
Email Engagement Metrics
Outbound emails are another tool marketers use to target audiences. Email marketing can take a while to master, but when done right, it can drive traffic to your website and encourage higher product adoption. Some metrics worth monitoring when running a marketing campaign include:
Not all emails you send get delivered. Some may bounce because of incorrect addresses, technical issues, or redirection to the spam folder. Obviously, when you optimize the delivery rate, your campaigns have a higher chance of succeeding. Your marketing strategy should account for convincing customers to share their genuine email addresses out of their interest.
This metric tracks the number of users who open the email. Mailchimp estimates that most email campaigns have an average open rate of just over 21%. These stats can tell you the effectiveness of subject lines and the overall performance of the marketing team. For increased engagement, customize your emails by stages of the customer journey, it’ll help increase your open rate.
Click-through rates (CTRs measure the number of times people click on the links provided in the email. This engagement metric can help track the effectiveness of your email campaign. Test email templates that encourage readers to click through, CTRs are a good way to measure user experience via email.
Email response rates track the number of direct replies received of all emails delivered. While measuring this KPI is simple, it is important to distinguish between positive and negative replies to get a complete understanding of customer engagement.
Using Freshchat, you can monitor the success of your email campaigns.
Given how integral customers are to any business, tracking customer engagement needs to be an important part of business strategy. Using a combination of different engagement KPIs, you can monitor and improve user engagement.
For a seamless in-product, website, and email engagement experience, onboard Freshchat and wow your customers with every interaction.
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