DMA advice: The future of customer engagement
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DMA advice: The future of customer engagement
Contents Acknowledgements........................................3 Introduction.......................................................4 Mindset................................................................6 Data.......................................................................11 Technology.........................................................16 Summary ...........................................................22 About the DMA.................................................23 Copyright and disclaimer..............................24
Acknowledgements
The DMA would like to thank our Customer Engagement Committee, and the following contributors:
Matt West
Chief Marketing Officer, Feefo
Helena Jennison
Marketing Director, Movember
Rob Christie
Head of Member Contact Strategy, Nationwide
Spencer Clarke
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Director of Member and B2B Marketing, Nationwide
Nicola Young
Group Marketing Director, NEC Group
Alison Sagar
Senior Director, UK Marketing & Head of Consumer, PayPal
Julie Dixon
Head of Information, Design and Partnerships, TFL
Sharon Heggarty
Marketing Director, Virgin Media
Nick Whitnell
Marketing Director, LV
Ian Oxley
Head of Membership Recruitment, National Trust
Howard Barber
Tesco Bank
Romain Bertrand
VP Marketing, eHarmony
COPYRIGHT | THE DMA (UK) LTD 2019 3
Introduction
In a changing technological landscape, it can be tricky to keep pace.
But marketers need to keep asking questions.
Not just of our audiences, but ourselves too.
That means listening in new ways about new things, connecting with real values of real people and by creating
memorable experiences that stand the test of time.
Building that rapport with your customer means they will come back to you time and time again.
As businesses, we must know what builds this connection, not only today, but in the future too.
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
From considered uses of data that help reach out to a potential customer at just the right moment, to using
the latest advances in technology to speak to each other in incredible new ways, customer engagement
constantly evolves.
Following on from our Customer Engagement 2018 event - a day celebrating the fusion of creativity, data and
technology - this DMA advice piece has been created to help marketers understand that which lies ahead.
These key learnings, captured from a roundtable session led by 15 thought-leading senior marketers, delve
deep into the latest behaviours around loyalty, real time data, new channels for acquisition and more.
A critical paper for absorbing the latest engagement trends and how they might influence commercial
decisions - this is your window to the next steps in brand and consumer interaction.
COPYRIGHT | THE DMA (UK) LTD 2019 4
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
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COPYRIGHT | THE DMA (UK) LTD 2018
2019
Mindset
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Knowing the ins and outs of how the consumer thinks still sits at the core of all we do.
From crafting an authentic brand voice to finding innovative new ways to tap into
their day-today, we must know them – inside and out.
In this segment, we consider the factors that feed into this.
Learn where companies should be directing their energy in the future, with further
reflections surrounding consumer behaviours in the current landscape.
COPYRIGHT | THE DMA (UK) LTD 2019 6
Latchkey
loyalty
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Consumer attitudes towards loyalty are changing.
With a decline in commitment towards lengthy, tie-me-down
contracts, the new consumer is interested in flexibility and choice.
The DMA’s How to win trust and loyalty report asked the reasons why
consumers were leaning this way and becoming more disloyal:
“Many companies and brands have
been ripping us off for years. Like many
consumers now, the best deal comes
before loyalty. Loyalty counts for nothing
with UK companies”
“The products have downgraded, and the
quality is going downhill”
“Due to the vast amount of new
companies coming up with better deals”
Facing a market of endless choice, options and temptations,
consumers are interested in a piece of every pie, and are increasingly
non-committal.
To retain business, companies must invest in that free to go, free to
stay component on services and products, across all industries.
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Why do you feel less loyal to companies and brands?
Price 23%
Choice / competition 22%
Lack of trust / corporate focus 17%
Maximising / shopping around /
need to budget 16%
Lack of reward /
lack of returned loyalty 13%
Lack of / decreasing quality / service 12%
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Other 6%
Bad publicity 4%
Shops going bust 1%
Total
This means brands considering what their customers really want and all departments across the business
believing in the long-term benefits of offering that flexibility; an empowering act of trust between brand
and customer.
According to the DMA and Foresight Factory’s latest insights, enthusiasm for flexible services such as this
is especially high when it comes to millennials, 47% of whom say that they’re interested in a pay-as-you-go
model for car insurance.
As for financial services, 61% of global consumers say they are interested in a hassle-free way to hop between
accounts to get the best interest rate.
Alas, this is not the be-all end-all for contracts, nor loyalty as we know it.
It is simply a new way for businesses to consider how to communicate commitment.
More importantly, it is an opportunity for brands to exercise new features to increase sign-up, and in the long
term, build a community of confidence.
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Identity
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
quest
Authenticity is a reoccurring theme in engagement.
Coming across as genuine and human continues to be a simple
consumer need when investing in a brand.
With organisations such as Nike, Patagonia and Jigsaw taking
political stances in their marketing, and more companies
investing in stronger brand values and tone of voice, being true
to what you stand for as a business now has an imperative role
to play in building trust.
Audiences are buying into stories that resonate with them,
rather than what they’re told to want and like.
Additionally, they are setting off on their own personal identity
quests, inviting brands along for the ride and plucking out those
that aid them in the pursuit of “real” along the way.
Cutting through the noise of ever-evolving technology and new
channels, it is brand personality and strong values that still seem
to be hitting home.
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COPYRIGHT | THE DMA (UK) LTD 2019Data
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
In a post-GDPR world, are we any better at understanding how we should be
managing and using data?
The short answer is “well, we could do a lot better”.
Businesses need to get wiser to the value of data, or face the consequences down
the line.
Consumers are more data-savvy than ever before with a greater grasp on data
exchange and the value of their personal details.
This section will look at how organisations should be considering the application of
those details, what data they should be holding, and how they can use that data to
connect with their customers the right way.
COPYRIGHT | THE DMA (UK) LTD 2019 11Doing data
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
differently
A major data challenge is often a business culture one, with different teams
working on different channels across the ecostystem.
Getting the data seems to be one thing, aligning that data so it makes sense
is another.
Companies need to consider their options here:
• Do they want an in-house team that can bring these different data points
together?
• Do they want to bring in a new platform or external support to help
manage the data aspect of the business?
• Is there a reason they are holding this data and do they actually need it?
In collecting consumer data, a business must know what it is they are after, and
why they want to ask for that data.
When obtaining the necessary information, they need to then extract and
prioritise accordingly.
Questions around what data you need and why could be answered by smaller
start-up companies, who have laser-guided focus on the customer experience.
These specialised businesses know what bigger firms should be searching and
measuring for, and could be the support network a business needs to manage its
data effectively.
COPYRIGHT | THE DMA (UK) LTD 2019 12Personalisation
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Taking your customer down a road that feels personally tailored to them can have huge paybacks.
Personalisation is about using data cleverly – not data for the sake of data.
The first step is to take the time to understand how and why a customer has come to your brand, what it
is they want, and how it is they want to consume that want.
From these learnings, a relevant journey can be mapped out, and the appropriate technology bought in
to execute it.
O2 and Lida exhibited this is in their DMA Award Gold winning campaign, O2 Refresh.
The aim was to use video to make a successful email re-sign programme even more personalised.
O2 identified a customer thinking of a new phone and told them how they could get it. And when they
were about to go out of contract they were contacted again - with a live countdown timer.
The video content created spoke directly to each customer as if O2 were there in the room.
This involved an incredibly complex data, creative and production process. They were greeted by name-
to-camera - O2 recorded the top 200 names, covering 80% of the O2 base.
Complex data algorithms allowed O2 to predict which phone would be most tempting for customers,
reinforced by a demo from a trusted O2 Guru.
In total O2 and LIDA created more than 4.3 million possible video permutations, with the click-to-open
rate more than 10 times higher than benchmarks for previous comparable activity.
Once a customer knew they had their own personal film waiting for them, they couldn’t wait to see it.
75% of viewers watched their personal video all the way through to the end.
Personalisation matched by creativity was the key to successful customer engagement.
COPYRIGHT | THE DMA (UK) LTD 2019 13Real-time
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
relevance
The world is changing and the trajectory is moving so fast that is can be
difficult to keep up.
Companies using real-time analytics are able to move with the trajectory;
allowing them to perfect their language and strategy to directly address
their audience and react immediately.
It is not a case of fixing, but refining and evolving – learning from that
refinement, and developing again.
If a message isn’t contextual to a customer then and there,
they won’t engage.
Trust comes from combining up-to-date qualitative research with
knowing your consumer’s behaviour.
Music, sport, nature; people’s passions haven’t changed, but how they
consume it has.
As long as a brand can be accessible to them at the moment they are
thinking about that passion, they can reach them.
Consequently, investment in real-time learnings is a smart move and
reacting to this data quicker than your competitors is what will take
brands to the top of their game.
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COPYRIGHT | THE DMA (UK) LTD 2019Technology
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Technology has opened new doors in dialogue and how we engage with one another.
But as ever-evolving technological advances fight for our attention, as marketers, it is vital we pinpoint
to when technology is helping our business model and when technology is just a distraction.
Read on to get a clearer overview of the tools and trends brands should be investing in, see the shortcuts
these new developments in tech allow consumers, and how to use tech while still maintaining that
all-important human touch.
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New
channels for
acquisition
Consumers seek engagement in new and innovative ways, and
technology, of course, has a key role to play in this.
Organisations should be investing in different channels to reach different
audiences. And so, what are the technologies that brands can leverage
when approaching an acquisition strategy?
COPYRIGHT | THE DMA (UK) LTD 2019 17Raise your voice
The interest in voice assistant is certainly out there:
Raise your voice
Siri. Alexa. Google. Is this the start of a voice revolution? The
interest in voice assistance is certainly out there.
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Have access to a smart home assistant
23%
Interested in owning one in the future
28%
In 2018 customers used voice commands
on smartphone/laptop to:
40% 35%
Research an Buy an item/
item/product product
COPYRIGHT | THE DMA (UK) LTD 2019 18The steady growth in interest in the likes of Alexa, Google and Siri show a movement away from the search bar
with consumers using home voice assistants, for example.
Why are consumers using
home voice assistants?
60%
for information e.g.
57%
receive reminders of discounts
54%
for entertainment
51%
receive special offers for
weather, bus/train times they can use before they are products/companies
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
about to expire they might like
How can we help you?
Chatbots are another application to key your eye on.
Findings in the DMA’s Acquisition and the consumer mindset report show a clear divide in chatbot appeal
among consumers.
In 2018, a quarter have used chatbots, and a further 27% would like to. Just under half (47%) would not be
interested in using a chatbot.
Millennials show greater enthusiasm; 37% have used them already, and 35% would like to.
Parents and those with higher incomes have used chatbots more than average, and larger numbers are
also interested.
With greater interaction in the likes of Asia markets, we are still yet to see how engagement might progress
in the West.
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New worlds
There has been some buzz around AR and VR for some time, and while immersive
technology hasn’t grown quite as fast as first assumed, the uptake over the next
few years should be considerable.
With 53% of Generation Y showing interest in VR headsets - and predictions
that 45% of young consumers will be using AR by 2022 according to DMA and
Foresight Factory research - the impact is palpable.
The opportunity for brands to connect with consumers from a personalisation
perspective is vast.
Customised realities allow for a new kind of emotional engagement that will see
some retailers move into physical spaces with no previous reason to be there.
Additionally, devices will become both more sophisticated and more affordable
seeing consumers engaging with new realities in the comfort of their own homes.
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Smart
shopping
There is a strong sense of anticipation around the rise of smart systems with the
availability to shop, search and even decide for customers.
This could mean automatic replenishment of what a consumer might need, with
previous data learnings reordering products before they have run out.
Investment in technologies such as this feed into the rise of “titan brands” with
auto-replenishment services removing a need for choice.
Consumers seek value but are also habitual shoppers, with the likes of Amazon’s
combination of familiarity and ease a compelling offer - providing consumers with
one place to serve many of their needs.
Brands will need to be more creative and work harder to cut through this mindset
and will need to ask themselves how they can still provide choice and flexibility to
counteract sake of ease.
COPYRIGHT | THE DMA (UK) LTD 2019 21Summary
It’s a thrilling time for customer engagement with big changes on the horizon.
From a consumer standpoint, there is a longing for empowerment.
No longer interested in fixed term contracts, they crave choice and flexibility and will invest long-term in
brands that come across as human and genuine with established values.
This means businesses living up to their brand promise to establish trust.
A brand’s path to acquisition will only be smooth if your data is in check, which means ensuring
communication across departments to bring together different data points and learnings.
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
Holding personal data that isn’t needed is seen as a betrayal of consumer trust and will impact brands in the
long run.
COPYRIGHT | THE DMA (UK) LTD 2019 22About the DMA
A DMA membership will grow your business. Our network of more than 1,000 UK companies is privy to
research, free legal advice, political lobbying and industry guidance. Our members connect at regular events
that inspire creativity, innovation, responsible marketing and more. Most of them are free.
A DMA membership is a badge of accreditation. We give the industry best-practice guidelines, legal updates
and a code that puts the customer at the heart. We represent a data-driven industry that’s leading the business
sector in creativity and innovation.
One-to-one-to-millions marketing attracts the brightest minds; individuals who will shape the future.
By sharing our knowledge, together, we’ll make it vibrant.
Published by The Direct Marketing Association (UK) Ltd Copyright © Direct Marketing Association.
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
All rights reserved.
www.dma.org.uk
COPYRIGHT | THE DMA (UK) LTD 2019 23Copyright
and disclaimer
The DMA Advice: the future of customer engagement is published by The Direct Marketing Association
(UK) Ltd Copyright © Direct Marketing Association. All rights reserved. No part of this publication may be
reproduced, copied or transmitted in any form or by any means, or stored in a retrieval system of any nature,
without the prior permission of the DMA (UK) Ltd except as permitted by the provisions of the Copyright,
Designs and Patents Act 1988 and related legislation. Application for permission to reproduce all or part of the
Copyright material shall be made to the DMA (UK) Ltd, DMA House, 70 Margaret Street, London, W1W 8SS.
Although the greatest care has been taken in the preparation and compilation of the DMA Advice: the future
of customer engagement, no liability or responsibility of any kind (to extent permitted by law), including
responsibility for negligence is accepted by the DMA, its servants or agents. All information gathered is
believed correct as of November 2018. All corrections should be sent to the DMA for future editions.
DMA ADVICE: FUTURE OF CUSTOMER ENGAGEMENT
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