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10 Result-Oriented Customer Engagement Model

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Are you noticing your customers drifting towards other brands and their products? Even though they know about your brand, they’re just not showing interest.

Looking for ways to create meaningful and lasting connections with your customers? The secret lies in the customer engagement model.

The customer engagement model is a modern marketing strategy designed to improve customer interaction. It’s the key to retaining loyal customers, driving revenue growth, and establishing your brand as a trusted leader in your industry.

In this blog, we will explore 10 effective customer engagement models that will help turn new customers into loyal advocates.

🔑KEY HIGHLIGHTS!

  • The customer engagement model is an approach businesses use to engage and create a positive connection with their customers. 
  • The result-oriented customer engagement models are AIDA, RACE, AARRR, USP, high-touch, low-touch, hybrid, automated retention, collaborative product roadmap, and CSM-driven models.
  • A good customer engagement model can boost conversion rate, customer satisfaction, retention, and revenues & offer customer support and personalized customer experiences.
  • The customer engagement model consists of four stages: 1) Unaware, 2) Aware, 3) Discovery and Onboarding, and 4)  Post-onboarding.
  • In-depth customer understanding, personalization, omnichannel experience, proactive customer support, and loyalty programs are the key components of a successful customer engagement model. 

What is the Customer Engagement Model?

A customer engagement model is a strategic approach that companies use to connect with customers, foster engagement, and build lasting relationships. It enables businesses to enhance trial conversions, improve customer satisfaction, increase revenue per customer, and boost customer retention.

what is customer engagement model

This model empowers businesses to craft a seamless customer experience across every stage of the customer journey. From the initial interaction to the final purchase, an effective customer engagement model ensures that every touchpoint reinforces brand loyalty and drives exceptional results.

According to data from Salesforce surveys, 80% of customers consider a company’s experiences as important as its products or services, highlighting the critical role of customer engagement in overall business success.

Why is the Customer Engagement Model Crucial for Businesses?

Companies that focus on customer engagement can increase 22% of cross-sell revenue and 13%-51% of upsell revenue.

A strong customer engagement model is crucial for businesses to create a great customer experience that develops loyalty and builds long-term relationships. With a customer engagement strategy, businesses can offer unique, personalized experiences to their customers. It helps them stand out and gain a competitive advantage in the marketplace.

Here are some reasons why the customer engagement model  is crucial for businesses:

  • Customer support: Customer support relies heavily on the customer engagement model to enhance customer experiences through personalized interaction and proactive support. This approach ensures that businesses address and resolve customer needs and queries before they turn into issues that could lead to dissatisfaction.
  • Personalized customer experience: A customer engagement model involves ongoing engagement with customers throughout the customer journey. It leverages data-driven insights to offer personalized customer experiences to target customers. Continuously offering customized experiences to customers can strengthen your relationship and turn them into loyal customers.
  • Increased customer loyalty: Continuously engaging customers can develop trust and an emotional connection with your business and lead to long-term loyalty. Emotionally connected and engaged customers are more likely to repeat purchases and become loyal to your brand and its products or services.
  • Increase revenue: Implementing a customer engagement model directly increases revenue. Engaged customers are willing to spend more money because they feel connected to your brand. Engaged customers not only spend more money on your brand but also referrals to other customers.

10 Customer Engagement Models You Can Try 

1.McKinsey Customer Decision Journey

One customer engagement model you can try is the McKinsey engagement model. McKinsey’s customer decision journey is a holistic approach to the customer journey. It emphasizes the key touchpoints businesses must focus on to engage customers.

It consists of 4 key stages:

  • Initial consideration
  • Active evaluation
  • Purchase
  • Post-purchase experience

This model aimed to provide a framework for marketers that is better aligned with modern consumer behavior. It is an approach that helps to understand consumer behavior, focusing on each stage, from initial consideration to post-purchase experience and loyalty.

It provides a holistic view of the customer journey from brand awareness to loyalty. It is a complex model that requires continuous engagement and support at every touch point. It is not suitable for small and startup businesses because it is hard for them to implement.

 2. LAER (Land, Adopt, Expand, Renew)

The LAER model is a customer engagement model designed by the Technology Services Industry Association (TSIA). LAER emphasizes the entire lifecycle of a customer relationship, from acquisition to retention.

It consists of 4 stages:

  • Land
  • Adopt
  • Expand
  • Renew

This model is suitable for subscription-based businesses. It provides a clear path for increasing a customer’s lifetime value. The LAER model is a structured approach to managing and engaging customers. It maximizes customer lifetime value by building a long-term relationship. It creates opportunities for upselling and cross-selling.

It is an expensive model; it requires high investments in customer services and training during the adoption stages. It is difficult to coordinate the efforts across different stages. Creating values to encourage and motivate customers for expansion and renewals is challenging. 

Stages of Customer Engagement

Customer engagement consists of 5 stages: unaware, aware, discovery and onboarding, and a post-onboarding engagement model. Each model is structured based on the customer’s journey. This helps tailor your marketing strategy to provide the right information to your clients at the appropriate stage of the sales process.

Here are some common customer engagement models:

A.Unaware-stage Engagement Models

It is a stage in which customers are unknown and unaware of the brand or its products/services. It is possible to create awareness and engage potential customers through outbound marketing, influencer marketing, and content marketing.

1. AIDA  Model (Awareness, Interest, Desire, Action)

AIDA stands for Awareness, Interest, Desire, and Action. The AIDA model was designed to guide marketing teams in creating an effective advertising campaign. It focuses on a holistic and personalized strategy to identify a customer’s needs and preferences.

Benefits

  • This model helps to identify how to communicate with customers throughout the customer journey. 
  • This model helps marketers understand customer perceptions and mindsets to connect with them. 
  • It keeps you updated on market trends and saves time.

Drawbacks

  • It is an outdated and oversimplified customer engagement model that is not applicable to branding.
  • It doesn’t consider the effects of technology on the customer journey because it was developed before the adoption of technology. 
  • It oversimplifies the customer journey but is more complex and dynamic.

2. RACE  Model (Reach, Act, Convert, Engage)

The RACE digital marketing model includes four key stages: React, Act, Convert, and Engage. It offers a simple, structured framework for planning and executing digital marketing strategies. This practical, action-oriented model focuses on building customer relationships throughout the marketing funnel.

Benefits

  • It is a customer-centric approach and helps create a high level of satisfaction and loyalty.
  • It helps in improving the effectiveness of marketing efforts.
  • It integrates with modern marketing activities.

Drawbacks

  • The four stages included in this model make it complex and difficult to manage simultaneously with the customer journey. 
  •  It doesn’t address more complex marketing needs.  It may not be suitable for all businesses.
  •  It is a more time-consuming model and depends on digital channels.

     B. Aware-stage Engagement Models

In this stage, the customers are aware of your brand and its products or services but are not interested in or ready to purchase. At this stage, you can retarget the audience, engage in social media, and use email or text marketing to create an interest in your brand, products, or services.

3. AARRR Customer Engagement Model

The AARRR model includes five stages: Acquisition, Activation, Retention, Referral, and Revenue. It is used by businesses to understand and maximize customer engagement strategies. It helps unlock existing customers’ engagement status.

Benefits

  • It helps to understand the behaviors of existing customers and their engagement status.
  • It provides a view of the entire customer lifecycle from acquisition to brand loyalty.
  • It helps to align customer acquisition goals with your business objectives.

Drawback

  • It includes 5 stages, which can be challenging to define and measure each stage accurately and consistently.
  • It focuses primarily on digital, online, and e-commerce companies, so it may not be appropriate for all businesses or industries.
  • This model is less flexible than other digital customer engagement strategies, as it’s designed to focus on revenue rather than acquisition.

4. USP Model (Unique Selling Proposition)

The USP model is a customer engagement model businesses use to identify and promote the brand’s unique value and products or services. It focuses on understanding the value provided to customers compared to competitors. 

Benefits

  • This model helps to highlight your unique value proposition, which can attract customers and stand out in a competitive marketplace.
  • It focuses on the customer’s needs and demands, which helps develop products and services that meet the customer’s expectations.
  • A strong USP model can boost sales volume by differentiating products and providing value to attract customers. 

Drawbacks

  • It only focuses on the features and benefits of the products and services, which may not be enough to engage customers.
  • It neglects the other factors of consumer engagement, such as customer services, customer support, or customer experiences.
  • It mainly focuses on attracting new customers, while customer retention is essential for long-term success.

     C. Discovery and Onboarding Engagement Models

In this stage, customers actively engage to find out more information about your brand and its products or services. You can engage the information-seeking customers through live chats, demos showing detailed product information, and onboarding emails.

5. High-touch Model

A high-touch model focuses on personalized and customized customer support. This model is appropriate for businesses that offer complex or high-ticket products. Using this model companies try to provide high services to each customer in order to build a long-term relationship and loyalty. 

Benefits

  • It helps to enhance customer satisfaction through personalized customer experiences and build loyalty
  • It creates opportunities for upselling and cross-selling
  • It drives revenue growth by satisfying a customer and building a strong brand reputation. 

Drawbacks

  • The high-touch model is more expensive than other customer engagement models. 
  • It has limited scalability, making it difficult to scale as business expands.
  • It is a time-consuming model and needs skilled and knowledgeable team members.

6. Low-touch Model

A low-touch model involves minimal direct interactions and engagement with customers. This model offers an automated process to engage customers using technology and self-service options, reducing the need for humans to interact with them. This model suits SaaS companies that desire to scale acquisition efforts at a low cost.

Benefits

  • This model saves labor and other operational expenses by automating customer services.
  • This model can be easily scaled as businesses expand because it offers automated processes for customer interaction.
  • It improves the customer experience by reducing wait times and improving the overall speed of customer service.

Drawbacks

  • As it depends on automated processes, it may be unable to offer personalized customer attention.
  • It has limited potential for building strong customer relationships.
  • Automated processes may not be liked by all customers. Some customers prefer human interaction rather than computerized interaction.

7. Hybrid Model

A hybrid model combines high-touch and low-touch approaches to provide a personalized and customized customer experience. This model seeks to balance personalized attention and automation interaction to meet each customer’s expectations, needs, and demands.

Benefits

  • This model enables businesses to adapt to customers’ needs and demands by offering customized and personalized attention and automation appropriate to the situation.
  • With this model, businesses can increase customer satisfaction, develop trust and loyalty, and ultimately increase revenue.
  • This model can be easily scaled as the business expands, and automation helps to handle more customer interaction with a personal touch. 

Drawbacks

  • A hybrid model is more complex and time-consuming than other single models. It requires more effort and strategies to implement.
  • Since it is a combined model, it is difficult to interpret the results and determine which model contributes more to them. 
  • If this combined model is not mixed in the proper ratio, there is a risk of overfitting.

     D. Post-onboarding Engagement Models

The post-onboarding engagement model involves maintaining customers’ interest in products or services after they purchase them from your brand. This model helps to engage customers to build loyalty and encourage them to retain for the long term. Loyalty programs, customer feedback, and personalization help maintain interest in your brand and its products or services.

8. Automated Retention

The automated retention model can be a suitable model for companies to keep their new, engaged, and productive employees after onboarding. It predicts which customers will continue with your brand and which will leave. Businesses need to balance automation with the need for personalized and human interaction. It helps to identify the effectiveness of the marketing efforts on customers to engage them.

Benefits

  • It ensures equal engagement and support to all newly hired customers regardless of location.
  • It is a cost-effective and time-saving model to engage newly hired employees after onboarding. 
  • This model can be easily scaled as the business grows and meets the increased demand for engagement and support.

Drawbacks

  • It depends on the technology, which may reduce face-to-face interaction and personal touch advantages.
  • Implementing this model may not be suitable for all types and sizes because it requires significant investment in technology and resources.
  • It is a less personalized model, so that some customers may feel disconnected and not valued by the business.

9. Collaborative Product Roadmap

In this model, businesses involve new employees in the product development process, allowing customers to see it. They develop the products based on new hires’ ideas, suggestions, and feedback. Businesses need to involve new hires in the roadmap of the product development process that engages and motivates them.

Benefits

  • By involving new hires in the development of a product roadmap, you can increase their engagement and motivation.
  • Involving new hires can increase productivity and job satisfaction and boost relationships with existing employees. 
  • It helps to bring innovations in products since it involves the new employees with fresh and unique ideas and perspectives to the product developments. 

Drawbacks

  • Developing a collaborative product roadmap can be complex, and conflicts can occur between team members. 
  • Involving new hires in developing product roadmap can consume more time. 
  • New employees may not have sufficient skills and experience, which may limit their efforts in developing the product roadmap.

10. CSM-driven Model

The customer success manager (CSM) driven model ensures customers receive the desired result when using a product or service. It works closely with customers and understands the goals and needs of the customer. Then, it develops the best strategy to help them achieve their desired goals and needs. 

Benefits

  • It focuses on customer success, so it helps to improve customer satisfaction and increase a customer retention rate. 
  • It acts as a bridge between the customer and the business and serves as an effective communication channel. 
  • It is a proactive approach that addresses and tries to solve the issues before they become customer problems. 

Drawbacks

  • This model is expensive because it requires hiring and training customer success managers to help customers receive the desired results.
  • It is a time-consuming model because identifying customer goals, preparing a strategy to achieve those goals, and monitoring the strategy’s effectiveness requires time.
  • It is not applicable to all types of businesses, especially businesses with low-touch or low-value customers.

Key Components of a Successful Customer Engagement Model

A successful customer engagement model involves creating meaningful customer interactions to build trust and long-term relationships. 

The key components of a successful customer engagement model are:

  • In-depth customer understanding: Understanding customers is a key component of a successful customer engagement model. To build a successful model, you need to research the target customers first, then analyze their feedback and track their behaviors to gain detailed data. This helps you offer personalized experiences and relevant content to customers. 
  • Personalization: Personalization is a key that influences customer engagement. Personalized emails and suggestions make customers feel valued and engage more in the brand and its products or services. With this, customers turn into loyal and retain for the long term. 
  • Omnichannel experience: Customers interact with various channels through customer engagement platform, so the customer engagement model should offer omnichannel experiences that integrate with multiple channels preferred by customers. Omnichannel customer engagement model help create continuous and consistent experiences.
  • Proactive customer support: The customer engagement model must take a proactive approach to support customers. It must address and solve the problems and issues before it encounters addressing customers.
  • Loyalty programs: Conducting loyalty programs is an essential component of the customer engagement model. Rewarding programs motivate existing customers to repeat purchases, create an emotional connection between customers and the business, retain customers and boost sales volume. 

Conclusion

The customer engagement model is essential for developing meaningful connections with customers, improving customer satisfaction, and leading to long-term loyalty. With this model, businesses can engage customers at every touchpoint of their journeys. 

In-depth customer understanding, omnichannel experience, proactive support, and loyalty programs are the key components of the customer engagement models that play a vital role in a successful engagement strategy.

Models like AIDA, LAER, and RACE offer a structured framework for a business to understand and personalize customer experiences.  By implementing these models and components, businesses can boost conversion rates, increase revenue, satisfy and retain customers, and gain a competitive advantage in the marketplace.

FAQs

What are the types of customer engagement?

The types of customer engagement are:

  1. Emotional engagement: It focuses on building a strong emotional bond between the customer and the company, which can increase customer loyalty and retention.
  1. Contextual engagement: It is about interacting with the customer based on various contexts, such as behavior, preferences, location, or even the device they use.
  2. Convenient engagement: It facilitates and makes customer interaction accessible through various channels, such as social media platforms.
  1. Social media engagement: Social media engagement means interacting with customers on social media platforms like Facebook and Instagram. 

How can a business measure the efficiency of the customer engagement model?

Businesses can increase the efficiency of the customer engagement model by measuring the following customer engagement metrics:

  1. Net Promoter Score(NPS): It measures customer loyalty by calculating the number of customers who are likely to recommend your business to others.
  2. Customer retention rate: It measures the number of customers retained over a given period. 
  3. Conversion rate: It measures the percentage of people who complete an action tied to your campaign goal.
  4. Social media:  It measures the number of likes, comments, shares, and other interactions received.

How can you create a customer engagement model?

Creating a customer engagement model involves various things, such as:

  1. Understand your customers: Analyze customer behavior, preferences, and pain points.
  2. Define goals: Always set clear goals and engagement objectives.
  3. Choose an engagement model: Choose an engagement model that has a high-touch, low-touch, or no-touch approach.
  4. Use tools: Focus on investing in necessary technology and automation to create a customer engagement model.
  5. Test: Test and continuously refine your model based on various data and feedback.
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Dinesh Silwal

Dinesh Silwal is the Co-Founder and Co-CEO of KrispCall. For the past few years, he has been advancing and innovating in the cloud telephony industry, using AI to enhance and improve telephony solutions, and driving KrispCall to the forefront of the field.

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