What’s Coming in 2023: 7 Big Trends in Customer Engagement
A challenging economic environment. An unsettled privacy landscape. New ways to engage users—and rising customer expectations. As 2023 gets underway, marketers need all the help they can get to make the most of their customer engagement efforts and ensure that they’re able to compete effectively in a post-COVID world shaped by digital transformation.
To help out, we sat down with three thought leaders here at Braze—Cofounder and CEO Bill Magnuson, James Manderson, SVP, Global Customer Success, and Marc Suchland, General Manager, DACH—to get their thoughts on what’s ahead when it comes to customer engagement, and what brands need to do today to get ready.
1. Economic volatility will put the spotlight on customer engagement automation
“Due to economic volatility, most marketers will be working with fewer people and resources in 2023,” Bill told us. “Technology that makes it easier for small teams to test, learn, and iterate swiftly can show rapid return on investment that compounds quickly through the benefits of creative experimentation. Along the way, deploying customer engagement strategies with clear and consistent value for customers will earn brands valuable first-party data, reducing their dependence on the pay-to-play advertising marketplace. The resulting foundation of first-party relationship assets will blossom into new opportunities as the world emerges from its present economic malaise.”
2. Spends will get more efficient—and optimization will become essential
“To make the most of marketing spend, we’ll see more brands analyzing where they’re spending on acquisition—and questioning efficiency,” James said. He noted that it’s currently “not uncommon for brands to inadvertently target existing, active, customers with ads through Meta or Google, effectively doubling up on spend.”
James also suggested that “we may see more marketers use this first- and zero-party data to audience match across marketing activities. Those customers that respond to an engagement in an owned channel can then be pulled out of paid campaigns, in real time. This not only ensures there’s no budget waste caused by doubling up on efforts, but it also improves customer experience by avoiding unnecessary message fatigue, and worse, the possibility of a recently purchasing customer receiving a just-too-late offer that makes them regret their purchase.”
“Campaign effectiveness should always be at the heart of marketing planning,” Marc told us. “In the era of digital multi-channel-environments powered by intelligent solutions, however, it has never been easier or more cost-effective to test campaign effectiveness. So, especially in times of tight budgets, marketers can focus on the right audiences, channels and time to drive towards the best results.
3. Brands will double down on customer loyalty and retention
James suggested that as economic headwinds continue and marketing spends receive additional scrutiny, “we’re likely to see more brands focusing their budgets on customer retention. Keeping an existing customer is typically easier and cheaper than acquiring a new one, and provides better ROI. In addition, the demise of third-party cookies and Apple’s changes to cross-app tracking permission are likely to further drive down the value of acquisition spend, placing even more emphasis on the importance of customer loyalty and retention.”
According to Marc, “customer engagement ensures customer loyalty and retention. The best new customer is an existing customer—this old marketing adage still holds true. And when the consumer climate cools down, it is even more important to retain customers and not drive them into the arms of the competition. Today, smart customer engagement platforms offer automated opportunities to run individualized customer engagement measures and campaigns with just a few clicks.”
James argued that “we’ll see brands doubling down on customer engagement and customer service to look after their existing customers, using this as part of longer term brand-building strategies alongside short-term ROI efforts. The key for brands will be ensuring they are offering continued value and meaning engagement to existing customers to maintain their loyalty.”
4. Targeted customer engagement campaigns will no longer be a nice-to-have
“While brand budgets are being heavily scrutinized, we must remember that so too are customers’ budgets,” James said. “Brands must continue to demonstrate value exchange by looking at aspects of customer engagement such as customer service and communication and making sure they resonate positively.”
James argued that “this is where first-party data and real-time orchestration can help brands make sure messaging is not only more targeted but more specific to the customer and their needs. Offers and recommendations should be as personal to the individual as possible and sensitive to their current situation. This makes it more likely that customers engage, but also helps boost customer loyalty to your brand at a time when consumers are increasingly making trade-off decisions on what to spend money on.”
5. To capture every customer, brands will need to focus in on anonymous users
“This year, brands should be getting a handle on anonymous users,” James told us. “Often, the vast majority of visitors to a company’s app or website are anonymous—in fact, a prior review of certain retail and eCommerce users by Braze showed that only 14% were logged in, with 86% remaining anonymous. These are users who browse or even make purchases with a brand's website without using an online account.”
He noted that “Braze research shows that participating retail and eCommerce brands don't communicate with 96% of their anonymous users—that's like ignoring nearly all customers when they come into your shop. Engaging anonymous users can be a powerful organic growth strategy for marketers in the coming year that helps cut back on customer acquisition, paid media costs, and bolsters first-party data collection efforts.”
According to James, “We expect to see marketers harness the untapped potential of these customers in the coming year as the battle for customer retention heats up. It's efficient—our study shows that if just one message is sent to an anonymous user, they are 58% more likely to purchase within their first week of engaging with a brand, as compared to known users.”
6. Operational efficiency will become a key need in customer engagement
In a world where every dollar matters and customers expect exceptional experiences, making sure that your operations are capable of reliably firing on all cylinders is essential. According to Marc, “Operational efficiency in marketing begins in the data strategy. Modern IT solutions connect data from all different sources and offer important insights. Such solutions automate processes and may offer AI-supported new options. This can free up valuable resources in the company, which can then specialize in other tasks. The right digital tools therefore not only offer advantages in the competition for customers, they also relieve the burden on companies in the ‘war of talents.’”
7. 2023 will see the rise of the interdisciplinary marketer
“In the coming year, successful marketers will continue to build closer collaborations with their data partners—testing, experimenting, and evolving ever-better customer experiences,” Bill told us. “Today’s customer engagement is an interdisciplinary sport, and those who welcome new tools into their environment, upskill with more technical learning, and lean into their data savvy will be better positioned to deliver positive business outcomes. You no longer need a computer science degree to embrace the power of programming, as best-of-breed technology is designed to be intuitive for non-developer users.”
The challenges facing marketers this year are real and significant. However, they bring with them opportunities for brands to uplevel their customer engagement programs, drive more value, and build stronger customer relationships over the long haul.
"We are extremely confident about the year ahead," said Marc. "That's because our solution for cross-channel customer engagement can be the missing piece of the puzzle for the data stack of companies seeking sustainable growth with optimized processes."
Interested in learning more about how thoughtful, automated customer engagement can help to drive stronger user retention? Check out our exclusive guide to modern customer retention.