Ultimate Guide to Customer Engagement


Learn how to understand and implement a sound customer engagement strategy focused on measurable goals.

What Is Customer Engagement?

Customer engagement refers to the level of interaction between your brand and your clients across all channels over the course of your entire relationship. It can refer to what customers do to interact with your brand as well as how loyal they feel about your brand. You can gauge customer engagement by what actions your customers take to interact with your brand and how frequently they exhibit those behaviors. In a digital context, brands usually measure customer engagement in terms of specific behaviors such as website visits, sales conversions, and downloads.

Customer engagement unfolds in stages over the evolving lifecycle of your relationship with your customers. The customer lifecycle typically includes:

  • Lead acquisition: Which begins when a prospect first becomes aware of your brand
  • Purchase: Which transforms a lead into a customer
  • Onboarding: When a customer first begins using your product
  • Adoption: As customer usage continues to grow and expand
  • Escalation: When a customer encounters support issues with your product
  • Retention: When a customer decides whether or not to become a repeat buyer and loyal customer

During each of these stages, your customer can interact with your brand in multiple ways.

Why You Need to Track Customer Engagement

There are several reasons why customer engagement is important. Your engagement levels affect your retention, referral, and revenue rates. Customers who are actively engaged with your company and are deriving value from it are more likely to renew their subscriptions. They are also more likely to refer your product to others. Both of these factors directly impact your revenue. In this way, customer engagement can predict profits.

This makes it prudent to proactively manage and boost your customer engagement levels. Tracking your customer engagement metrics forms a starting point for increasing your performance. By monitoring your current performance, you can identify and quantify where your engagement strategy is falling short. You can then set measurable customer engagement objectives and make adjustments to improve your performance.

Types of Customer Engagement

In order to track your customer engagement and develop effective strategies for improving it, you first need to define what you’re going to measure. There are different types of customer engagement that you can monitor.

You can define different types of customer engagement in relation to the different stages in your customer’s journey. During the acquisition stage, you can evaluate customer engagement in terms of activities such as:

  • How often customers visit your website
  • How many pages customers view on your website
  • How long customers spend on your website and on specific pages
  • Open rates and clicks with customer marketing emails

During the buying process, you can gauge engagement by activities such as:

  • Sales conversions
  • Abandoned shopping cart rates
  • Average value per sale

In the onboarding stage, engagement may take forms such as:

  • Opening welcome emails
  • Activating software
  • Time to complete each stage within the onboarding process

In the adoption stage, engagement can involve:

  • Account usage frequency
  • Time spent in-app
  • Active user rates
  • Core user actions
  • NPS scores

When customers encounter support escalation issues, you can monitor engagement through factors such as:

  • Number of support tickets
  • Escalation stage
  • Average resolution time
  • First-call resolution rate

Finally, in the retention stage, engagement correlates with items such as:

  • Retention rates
  • Churn rates
  • Net promoter score

These are just a few examples of ways you can define and measure engagement in each stage of your customer’s journey. There are many other ways you could measure engagement in each stage. Today’s best customer engagement solutions allow you to define your own engagement goals. Customize your definition of engagement to focus on the metrics most relevant to your business goals.

You can also define engagement in terms of different models based on the number of customers involved in the engagement. In some types of interaction, you engage customers individually, which can be called a high-touch one-to-one engagement model. In other interactions where you use automation, such as knowledge databases and chatbots, you support multiple customers at the same time, using a one-to-many model. Many companies use a blended model where customer interactions occur on a one-to-one level while others are handled through automation using a one-to-many, tech-touch model.

Types of Customer Engagement

Customer Engagement Strategies

You can employ many strategies to improve customer engagement. A few of the most important include:

  • Connecting multiple data streams
  • Creating a customer engagement framework
  • Scaling communication with technology
  • Planning next steps for different stages of customer journey and health
  • Tracking success at each stage of the journey
  • Mapping and optimizing your customer life cycle

Here’s more about how to put each of these principles into practice to create a strong customer engagement strategy.

Connecting Multiple Data Streams

With the Internet of Things, your customer data may reside in data streams from multiple contact points and departments, including:

  • Social media
  • In-app usage
  • Customer success department
  • Sales department
  • Finance department

Data within your database may also be stored in multiple categories, such as customer account lists, user lists and activity logs.

When your data is segregated in this way, you run the risk of disrupting customer experience by failing to incorporate important information which from your perspective resides in a different data stream but for your customer figures into their overall interaction with your brand. Improve customer engagement by connecting multiple data streams using a unified integration hub.

Tracking Success at Each Stage of the Journey

Timely response to snags in your customers’ journey depends on real-time monitoring of customer account health. To track customer health, you can set up key performance indicators (KPIs) corresponding to points of engagement along your customers’ journey.

Examples of engagement KPIs for each stage of the journey include:

  • Lead acquisition: unique visitors, bounce rate and opt-in rate
  • Purchase: sales conversion rate, shopping cart abandonment rate and sales return rate
  • Onboarding: time to complete onboarding, customer progression and response rate
  • Adoption: interactive usage, non-interactive usage counters and activation metrics
  • Escalation: response time, first contact resolution rate and customer satisfaction rate
  • Retention: retention rate and churn rate

These are just a few examples among many other KPIs you could use. We will discuss a few key categories of metrics in more detail below. For the moment, the main takeaway is the need for defining measurable KPIs to allow you to track account health and engagement. Set up your automated tracking system so that if a KPI on an account falls into a scorecard range indicating a problem, your playbooks can take the lead. SuccessPlays game plan automatically goes into effect.

Creating a Customer Engagement Framework

You can put customer data to use by incorporating it into a framework structuring how you engage with customers. Your framework can be organized around the stages of the customer lifecycle and journey experience outlined above. Using this approach, you would define how you engage with the customer during each stage of their journey:

  • Lead acquisition
  • Purchase
  • Onboarding
  • Adoption
  • Escalation
  • Retention

Within this general framework, you can drill down into each stage and define more specific steps your customer takes in each phase and how you engage with them. For example, the steps which lead a customer from your marketing content to filling out your website’s discovery form can be mapped out to flesh out the lead acquisition stage. You can then identify how you engage with your customer during that stage.

Scaling Communication with Technology

Engaging your customers effectively depends on efficient communication. Communicating personally with each customer could get different for a large database if you had to rely on manual methods, but fortunately, technology allows you to personalize communications at scale for all your customers.

By segmenting your database based on customer profiles, you can deliver personalized content relevant to where each customer is in their journey. This allows you to communicate efficiently with a large number of customers without expanding the size of your customer service team.

Planning Next Steps for Different Stages of Customer Journey and Health

At each stage of your customer’s journey, their progress to the next stage depends upon performing specific actions. You can encourage customers to take actions that lead in the desired direction by mapping out which steps they should be taking at each stage of their journey.

Whether or not they take the desired steps depends on resolving any issues which can impede their journey at each stage. For example, frustration during the onboarding process may prevent them from progressing to becoming an active user. How well your customer is progressing in the desired direction and overcoming such obstacles can be tracked as a metric called Customer Health in Totango’s platform. You can promote a healthy customer account by automating which actions the customer should be taking at each stage as well as what actions you will take in response to potential challenges the customer faces at each step in their journey using your playbook.

Mapping and Optimizing Your Customer Life Cycle

To better promote and track your customer’s engagement at each stage in their relationship with their brand, you should map out their customer journey at each step in their lifecycle and take steps to optimize each stage. The general stages of the customer life cycle have been discussed above:

  • Lead acquisition
  • Purchase
  • Onboarding
  • Adoption
  • Escalation
  • Retention

At each stage, consider ways you might offer value to customers in order to promote optimal engagement and account health. For example, you can offer:

  • Training
  • Community forums
  • Round table events
  • Webinars
  • Written documentation
  • One-on-one time during certification workshops or question-and-answer events
  • Limited-time access to exclusive features
  • Product roadmap updates, with emphasis on requested features

Review your customer journey map systematically and seek to identify points where you can insert value into the process.

Success can be repeated throughout the customer lifecycle. Once you know which steps successfully promote a healthy account from one stage of your customer journey to the next, as well as what to do to fix an unhealthy account, you can simply track your health scorecards and playbooks.

Customer Engagement Success Metrics

You can evaluate the effectiveness of your engagement strategies by tracking key metrics to measure customer engagement. Here are some of the most important key performance indicators to track. You can use enterprise customer success software such as Totango to track these other metrics customized for your business.

Activity Time

You can quantify your customers’ engagement with your product by measuring how much time they spend actively using it.  This factors out idle time when they’re logged in but not taking any actions. Factoring this out is important because some customers may be logged in when they have multiple tabs open and they’re doing things on other sites or simply not using their device. Focusing on active time gives you a better sense of how much actual time customers are spending using your service.

Visit Frequency

How often customers visit your site to use your service reflects the value they’re getting from your company. When tracking visit frequency, evaluate results in relation to how often an engaged customer should ideally be using your service. For instance, with some products, you would expect users to log in daily. For others, frequency should be closer to weekly. Determine the level appropriate for your company.

Core User Actions

Core user actions are activities specific to your company that engaged users should be taking. They vary with the nature of your product and can be custom-defined. For instance, if your product is a Human Resources(HR) software, an engaged action might be adding a new employee. Define and track user actions that are relevant to your product.

License Utilization

License utilization is the ratio between the number of active users in an account and the total number of licenses paid for by the account holder. This metric can be useful if your product is priced based on the number of users.

Choose the Right Software to Support Your Engagement Strategy

Implementing a sound engagement strategy focused on measurable goals requires using a suitable software solution. Totango Spark includes features designed to help you track and manage engagement throughout your customer’s lifecycle. Request a demo and see how we can help you drive customer engagement, retention, referrals, and revenue.

Successful Customer Onboarding


Identify Key Performance Indicators for Onboarding


Put the Right Processes in Place


Get Visibility Into Customer Status


Complete Key Milestones Within a Desired Timeframe


Create Just the Right Program to Drive Adoption


Analyze Bottleneck Reports


Create a Usage Report and Adoption List


Measure Onboarding Results


Perform Regular Check-ins with Customers

Successful renewals & Upsells


Motivations for Renewal


Getting Customers to Renew


Expanding the Relationship with Upsell