There's that boundary between the robot and the human, and how do we make sure we're leveraging AI and those components to make sure our customer services is servicing the best information that we need to make the human interaction between the brand and the customer really personal but valuable. It's time for CX education. Welcome to the podcast for Enterprise CX Professionals. The people who want to connect with customers on their own terms before, during, and after a purchase is made. In each episode, you'll learn how to create experiences your customers love. Ready? Here we go. Hello and welcome to a new episode of CX Education, a podcast that is brought to you by Sinch, the Customer Communications Cloud. Today, my guest is Kelsey Jones. Kelsey is Global Head of Product Marketing at SAP Emarsys. Prior to this, she has over a decade of experience in marketing for some of the best B2B tech companies out there, from Salesforce to ExactTarget, Adobe. So she's been leading a team in marketing for many years now and now leads a global team of product marketing at SAP Emarsys. Welcome, Kelsey. Hi, Gwen. Thank you and super, super excited to be here today to talk about all things CX. So we were joking a little bit before this, right? There's a lot that bundles into the topic of CX, so I'm excited to kind of drill down to just a couple key areas today. So thank you for having me. Exactly. Excited to have you on board. So maybe we can start by having you explain to us a little bit what is SAP Emarsys? I think we all know SAP. That's a very well known name, but what about Emarsys? Tell us a little bit more about what you do exactly. Yeah, absolutely. So SAP purchased and acquired Emarsys a little over three years ago. Coming up on our three year anniversary, Emarsys has been around for many, many years. So it started as an ESP and then that email service provider and really evolved into being an omnichannel customer engagement platform, which like I said, three years ago, SAP purchased us as being really part of their core offering within CX. That is the marketing line of business. So Emarsys customer engagement is really all about how can we empower marketers to help them build cross-functional, cross-channel campaigns that help them reach customers wherever they are? Whether they're engaging with them on email, whether they are engaging with them on SMS or any type of mobile device, the Emarsys solution really helps empower marketers to help brands reach them wherever they are. That's amazing and it's a great explanation. It's very interesting because as you probably know, with Sinch we went on a similar acquisition journey, but we actually started with SMS and now moving into email, although the two companies are pretty complementary and don't exactly compete on the same level. So it's quite interesting to see how everything is becoming more multi-channel, omnichannel. I think we could put a little pin on that and come back to it a little bit later in the discussion. But today we really wanted to talk about this report that Emarsys just published, which is the Customer Loyalty Index that you do every year, right? Yeah, absolutely. So hot off the press is our third annual Customer Loyalty Index report. So what this is, is we go out and we look at and talk to over 10,000 different consumers and really try to understand overall how they think about loyalty. And we think about the term loyalty even as a brand, right? We look at it as the outcome of what we want of every customer, right? We want them to become loyal. We want to retain them. So we really try to understand in this report what are those consumer behaviors that are driving it? How do we really understand how consumers are behaving so that brands can understand how different things like inflation or brand reputation or different customer service experiences are impacting a customer's loyalty within a brand. So I'm super excited to dive into some of the things that we found out within this report with you guys today. Yeah. What do you think like loyalty is so important, especially for retailers. Because I think we all know, like, yes, we'll like to have all customers come back. But I think for retailers, it is kind of almost the core of the game, right? Like it is definitely a very essential and crucial play for them. Yeah, absolutely. And like you said, I mean, loyalty, it is in a rapidly changing consumer landscape, right? We think about brand loyalty. It's really become a fluid concept. It's influenced by cost considerations, different types of loyalty that a shopper may have for different brands. Loyalty as a whole, I think can take many different forms and shapes. So what we were really starting to see is really looking at this world of a digital first retail, always on commerce and these increasing in control consumers. We're seeing a lot of different ways that they are changing when it comes to how they are loyal to a particular brand. We'll dive in like some of the details we found is really how changes in global and economic conditions right over the last several years have really impacted which brands consumers are loyal to. And I think that's what's been super interesting, is how people are demonstrating loyalty is different than they had ever before. And it's going down, right? I think like customers are not as loyal as before. I think that was part of your research when you see that customers are really seeking this kind of level of variety and I guess it's a lot easier now then you can shop online. It's easy to kind of compare and shop everywhere. So there's only I think 66% of the people who answered your survey who said they are loyal to a specific retailer. So that should be kind of worrying for retailers right? Like people are less and less loyal. Yeah I think it is a little bit scary, right? They're less loyal to a brand but I think within parameters and I think we can dive into that a little bit more, but like you said, that 66%, that's a big number of people that aren't as loyal to brands anymore. That doesn't mean, and the research is showing us that doesn't mean that people aren't shopping, they're going to find different ways that they are going to get the things that they need and from brands that can deliver it when they need it. So I think we're seeing that overall trend go down, absolutely. But there are some ways that people are sticking to a particular brand that they do love and quite frankly, that they trust. So the number of people with a favorite brand that they love and trust, that's going down too because that experience that they were getting before at the price that they need, something in an economic climate that we're in, those play some pretty significant factors when it comes to demanding that brands continue to win their loyalty over time. So expectations on brands are basically higher, right? Like people want more and have higher expectation to give their trust and to give their loyalty to a brand. It's requiring more from the brand right like they then need to do a bit more, right? So what does that mean for retailers what can they do? What can retailers do to keep the customers coming back and to increase that stickiness level? I think we also ran a podcast earlier this last week with Joanna Milliken, our CEO, and she said something that really kind of stuck to me and she talked about how people want transparency, but what does transparency mean from a retailer? It can mean a lot of different things. Is it transparency around, are you giving me the right price? Is it – are you being transparent about how your sustainability efforts that you're building within the products that you're surfacing? Is it transparency of – I've purchased something, now I know every step of the way until something gets to my doorstep. I think having set clear shopper expectations is super important. And being very clear and more explicit what brands must do to secure that loyalty, I think is really important. So we're seeing that trust and transparency really start to come forward and really be clear with customers from a brand's perspective, what they are getting from the brand, each step of the way. I think the second thing is really around the importance of excellent customer service. And I know we can talk a lot about that, especially when it comes to SMS and conversational channels, but really providing it excellent customer service has become the third most crucial factor in winning customer loyalty. And the research has said with 44% of respondents were saying that that is the most critical factor. I think it's a great opportunity when we think about all things AI and conversational channels, especially when we come to deploying it and working with different types of channels, like a two-way conversation with WhatsApp. Being able to do that is really important, and customers expect it. They want to have that customer experience, but they want to do it on their terms with trust and transparency at the forefront. Right. So it's really like how when we say customer service and I think sometimes we are a bit vague, but like, do you have some kind of insight on what are some of the expectation? Is it about being able to reach out to customer service in a very easy way to exchange a product easily? Or like all of those interaction that they want easy access to or like it's also maybe the response they get right? Like you said on their own term, maybe you could explain a bit with that as well about how retailer can up approach that. Because it seems simple, but it's actually rather complicated, right? I think it's a lot of different factors. I think it's the sum of the parts really that adds up. It's about a lot of different touchpoints, having that right information, knowing why my product is back ordered or understanding where is that in the shipping process, or if you don't have this type, what type of product do you have that is available? And doing it in a seamless way is really important from a customer service perspective. So whether I'm calling in about something or I'm engaging with someone on chat, I think it's all of those different elements that, you think about it as a brand, it has to become personalized, right? There's that boundary between the robot and the human, and how do we make sure we're leveraging AI and those components to make sure our customer services is servicing up the best information that we need to make the human interaction between the brand and the customer really personal but valuable. I think that's what is the difference in those service components is, don't just give me information. Make sure you're providing the information that's going to be valuable to what I need in that moment. Because if I'm calling a customer service person on a line asking about something that is back ordered or perhaps lost in shipment, I want to know immediately where's it at? And if we can't find the information of that, what are we going to do about it? And I think it's that personalized experience and being transparent along those different types of communication channels is what's most important for brands to be able to deliver that great experience. That truly drives me going back to a brand as a loyal consumer. So I think that's like highlighting the importance of communications, right? I guess you and I at Sinch and Emarsys are definitely in that communication space, like how we try to make sure brands stay connected with their customers throughout the customer journey and offer different way you could engage with your audience along the way. You mentioned personalized experience, and I think I guess that's a little bit of the core of what Emarsys does, right? Like on being able to offer that level of personalization. Yeah, absolutely. So I think what we're really seeing in a lot of the research that's telling us, personalization has been around. It's not going away. People want more, but there has to be a value exchange. If I'm going to give you my phone number, what I want you to give me back as a consumer is relevant information. I don't want you to be spamming me and communicating. I want the information that's coming back is that value exchange. And I think that's driving a lot of the loyalty, different types of loyalty. That and the shame that can be have that a, excuse me, brand delivers. The one notable trend that came up was 20% of consumers have become more loyal to brands offering the best personalized deals over the last year, the last 12 months. On top of that, 20% of consumers have signed up or started a loyalty program in 2023 to ensure that they're getting the best value. So I think really combining loyalty programs with a personalized approach is really where we're starting to see rubber meet the road for organizations and for brands that are trying to reach consumers, giving them the right value at the right time with a personalized offer that's relevant to them. That's when we're going to see customers really start to lean in and stay loyal to a brand because they know it's personal to them, and it's a cost conscious effort that the brand is having with that consumer in that moment that's really important. That's like how brands can tackle this more volatility, I guess, of the customer or the fact that they need that variety all the time to bring some stickiness is really to know the customers better, getting a better understanding of the customers and being able to offer deals just for them. I guess we're all after those deals, especially in this economic situation. Like I think that plays a really big factor. Like if people are looking for those deals when times get tougher. Yeah. I think not only looking for a deal, but also convenience. I think what's really important is it making it easy? And actually technology has really made better catalysts for this. We expect things to be quick. We expect things as consumers to be timely and relevant. And if we can do that in a way that's personalized but giving them that ease, you know, if I can pull up my loyalty card directly on a mobile wallet, for example, right on my phone and I make it really easy to do, boom, I can have my points right there or that voucher right there, making it easy and convenient. That's what's going to help brands get through and cut through some of the noise with some of their competitors, right? They're going to make it easy. They're going to make it convenient. They're going to also tap into having those loyalty kind of a point, that value exchange that consumers are able to get right in the palm of their hand. And I think, we talked about it earlier, customers expect more from brands. That's not just about, they expect more and what they're getting from brands, but also, more loyalty points to be spent. I think one of the stats, if I remember correctly, is around 46% of consumers are wanting their loyalty points to be spent at as they choose. They want the personalized offers, they don't want to be told you can only spend this amount at this date. They want some flexibility in that and I think that goes back to the transparency point that we made earlier. How can you be transparent as a brand with your consumer making it easy, but then also making sure we're giving customers the expectations or the flexibility they need to say, to stay loyal to our brand? Right. That's great. So I think that personalize offers throughout like the pre-purchase, I guess, and like the constant communication throughout the purchase and the customer service and the after purchase, all of that comes together in giving that personalized experience along the entire journey. Right? So I think that's interesting and something that brands and companies can do much better today than they could in the past, right? Like I guess the technologies to enable those experiences are there. And it's not that hard, I guess, for customer, for brands, sorry, to offer those personal experiences if they are the right technology in place. And we touched on like the omnichannel aspects of it and how customers are everywhere, right? Like we now ask consumers we very much still use email in many different ways, but we also use our phone and connect of like SMS or you mentioned WhatsApp and all of those different channels. So there is definitely now this this need to become more omnichannel for brand than before. What does it mean for you for brand to become truly omnichannel? Yeah, I think that not every brand needs to be on every single channel, right? I think that's the message we don't want people to take is you can't be everything to everyone. If you're doing that, you probably are connecting with everyone. I think it's important to kind of look at the brand, look at your consumers, put yourself in your consumer's shoes and really understand how are they and do they want to engage with your brand? What channels make the most sense? What content do you have that you can service up in a timely, relevant, meaningful way? And what does that look like? And then also, right at the end of the day, these channels also have to be driving revenue for our brand. If we're just looking at channels, we also have to be looking at the measurement. Are they providing the business outcomes that we need? If they're not, what should we be doing differently, or is this the right channel we should be on? So I think, there's no question. Email is still alive and well. Email is still the lion's share of revenue. And it will continue to be, especially as we move generation to generation, these other channels will pop up, right? We look at TikTok and came around five years ago. There's over 5 billion users. So there's a big market there. But is that the market for every brand and channel? We need to challenge ourselves as brands to look at where we need to be, but also as a technology organization, as a vendor, a B2B vendor, we need to provide that flexibility, that composability that if they need to turn on a channel quickly and do an easy, we need to be able to do that for our brands. And that's what we are seeing tremendously. Whether it comes to the adoption of Mobile Wallet, which we just launched earlier this year, or working with our integrations like you and Sinch around SMS and around all these conversational channels that are popping up. We need to make it easy for brands to turn on channels that make the most sense for them. And we need to make it easy so that they can also measure the impact that those channels are providing to their business. And that is what we ultimately want to do, right? As any vendors really help consumers reach their customers no matter what channel that they are on. And making sure that it's connecting to their overall strategy that they're delivering as a business. Yeah, exactly. It's not for every brand to be everywhere across all channel, but it's having the ability for the right brand to reach the audience where they are. Like so depending on the run you have an offering as vendors like offering the possibility to do it all doesn't mean do it all at once, right? What space or how do you see the SMS and messaging channel fitting into the mix of communication. I think this has been kind of a growing, as I mentioned, Sinch started with SMS. We now provide also all of the different other messaging channels as well as email and voice. And we see definitely a place and a complementarity between the channels and they're not all used for the same thing at the same time, but they really complement each other because consumers are on those different channels, but they don't have the same expectation for each one, right? Yeah. I think a couple things. I think one, we have to look at, that's why I really love looking at consumer research like this as saying what are our customers saying? So that we as vendors can look at and say, here is how our brands and what they are needing to adjust to. So I think looking at consumer behaviors, customer priorities, we know in 2023 and now into kind of 2024, customers are focus on receiving quality products at a reasonable price and knowing that they're going to get a good service. Okay, if we know that, then these factors are at the core of building and maintaining loyalty. So how can a brand connect across SMS, other conversational channels, email in the right way? And I think what that then takes is a really proactive strategy. So a brand really has to know, it's crucial for marketers, for retailers, to look at their marketing strategy and their plan to ensure that they're not just reacting to the demand, they're predicting it. They're understanding and they know enough about their consumers. They're listening to the consumers. Are they engaging on SMS? Are they engaging on email? Are they jumping from web to SMS or from SMS to web or into email? What do those paths look like? And then how can you create those seamless omnichannel strategies that bring together IT, marketing, data, value exchange, all of that around a strategy to achieve that. So I think we have to look at those customer priorities first, understand how they're engaging with our brand, and then know which channels to turn on when or know which channels to use at the right moment. And you could probably talk miles over me around talking about SMS, right? But SMS is such a, I pick up my phone. It's very personal to me. I don't want every single offer coming to me on my phone about anything. Right? It is a moment in my palm of my hand that it needs to be important. So how do I provide that right message that's going to be important without becoming noise? I think that's where I start to see brands that are doing it really well. Reformation does a really good job of giving me the right communication, but not spamming me when it comes to SMS. So I think there's some nuances there to listen to our customers first to divide that strategy. Exactly. There's often a misconception, I believe with SMS. When you mentioned like we do SMS, people say, "Oh yeah, I see all the spams," right? And maybe I shouldn't say this, but like that's kind of the truth. When you're like, "Oh, it's like all of those offers." Yeah. But people don't think about it when they actually receive an SMS that's telling them, "Hey, your package is here," right? Or when they want to return a package or something, and then they start exchanging with a customer support through those messaging channel. And then in that sense, it's still SMS, it's still messaging, but then it gives the value to the customers, right? Like in a very different way. I think it's like, SMS is definitely a more personal channel, I think. Things are changing and brands are seeing amazing success right in using SMS also in the marketing approach. But that's when the personalization becomes even more important than through email potentially, because you really need that message to be bringing value to the consumer, right? Otherwise they will categorize it as spam. I think you hit the nail on the head like if we kind of just like maybe tried or didn't try, but like pulled it back to the top of what we talked about around personalization as being the big driver and knowing, you can't be everything to everyone. Knowing what those channels are that are important to your brand are then going to know, Oh, if they're communicating with me on email, I know what to expect, but I'm going to have a personalized experience. Of course I'm going to go back to them and deliver and have more of a loyal experience with them than I would if it felt like some out of non-personalized communication. I think you're spot on how you can do that really well, no matter what channel you're engaging with them on. It has to be the right nuance for different brand. And it really starts by understanding who the customers are, right? Which is kind of also what what the platform like Emarsys provides. This kind of data behind what the customers are actually doing and being able to have that knowledge in place for then being able to connect with them. That seems kind of easy, I think. Like, yeah, we just send an email or send an SMS. But the complexity of it, of the technology behind it and the deliverability access, the connection aspect is important because obviously if you don't receive that SMS, you don't receive your packages here or you miss that. Like there's moments where it becomes actually crucial to make sure that link isn't broken, right? But I do believe as well that it starts with understanding your users, your customers, right? Like so that you can know what will make sense for them. So bring that personalization. And as we move into holiday like we're heading into the holiday season, ready or not, here we come. How it's already that time of the year, I don't know. But now brands, you're getting an influx of traffic. You're getting an influx of data from your customers, from consumers. Look at that data, listen to it. Use that data now to really understand it and ensure that clean data so you can leverage it for personalization. We're seeing all of these different traffic moments across not just our website, but the mobile device is going up again and again, whether you're on app or you're just engaging mobile. How can you make sure you're listening to all of those components as customers are coming in and use it to your advantage? Because things are moving fast. We know that consumers are hopping across the board to different brands, and if you aren't relevant with that personalization, they're going to move on to the next one. So being at that forefront as you're heading in the holiday season, it's going to be really important to make sure you're capitalizing on the right moments with the customer and making it a really personal experience, no matter, like you said, engaging with them on the right channel anywhere that they are. Yeah. More than ever, right? I think this period is one of the busiest for retailers, so it's very important for them to be a very ready. I mean, I'm sure like they've all planned to be ready way before now. But any that come a little bit out of the blue but any tips or like first hand ideas for retailers to make sure that they don't miss the mark in this next holiday season coming up? Yeah I think you know retailers have been planning this since, early in the year like the January, Feb. The train has left the station, right, but I think now it's the optimization moments. You're listening to all of the different points coming in, you're pressure testing and seeing what's working and what's not. I think now is don't make any big adjustments. Now is not the time to pivot a big strategy. You've planned for this for a while now. There's a lot of listening that's going to happen and understanding to making sure you're keeping the lights on. No big pivots. But listen and see what those different moments are, but see what channels are driving engagement. Is the content you are serving up the right content to being delivered and is it the right offer for those people? I think now as we move into this holiday season, what may be a little bit different for retailers is from an inventory management perspective. And we at SAP really look at that from the back end, the back office all the way to the front office making sure that that entire experience from the time someone purchases something, from the time it hits their doorstep, how can you really make sure every part of that engagement is really spot on? And as a retailer now heading into the holiday again, wouldn't change anything or think any, make any drastic changes in your strategy. But it's what are the little nuances that you can do to make sure you're providing that personalized touch along the way? I think you're going to see that when they come back for a repeat purchase, when they need you to return something or get a new size or exchange something or come for a second purchase later. That's going to be a driving factor, I think, for retailers this holiday season is making sure that they manage that expectation properly so those customers continue to come back. Yeah, I love it. I feel like we could do potentially like a whole other episode on the holiday season and like how do you optimize for but maybe that's something for Janurary or February when the retailers are actually planning for the season. We are approaching the end of our discussion, but I wanted to come back to the report and the research that you've done on this. Customer loyalty and the importance of it for retailers. Any other key information or key learning that you want our listeners to keep with them as they finish listening to this podcast. Yeah I think the main thing, we always have to be listening to our customers, to consumers in general. And those changes are happening dramatically over the course of now in this third year that we're doing the report. You know, it's so important to kind of look at the different types of loyalty. There is never one single type of loyalty. And that's what I love about this reported, it dives into different kinds and how you can manage different types of programs around that, making sure you have the right content, use cases, strategy, technology in play to deliver on those loyalty programs, whether that's the five types of loyalty in this report are one incentivized loyalty, which we talked a little bit about earlier, and how that's gone down dramatically, 16% actually year over year. Inherited loyalty, which is really about the association with other brands. Silent loyalty, we think about, customer loyalty that is without any public endorsement. I think about I've been buying literally the same blush for the last 15 years, but I don't go out and promote that exact blush I've been using. But that silent loyalty is really interesting to understand. And then ethical loyalty and true loyalty. Those are the five different types of loyalty that a consumer can have and different programs and use cases can be run around those different types of loyalty that can help you retain customers. So I would dive into that report, really understand the nuances between those different types of loyalty and make sure you have the right program and strategy in place to make sure you're executing on those throughout this holiday season and into your 2024 program and planning. That's so interesting because when we think about loyalty, I guess when I think about loyalty and I'm a bit biased because I'm doing brands, I guess. That's kind of the job I have. I think about brand loyalty a lot and about how brands or retailers need to build a strong brand that customers love. But in reality there's a lot that comes into that. It's not just about the sense of belonging you might have with a brand or like we think automatically of those big brands that everybody loves and is a fan of. But here you talk about this and looking into the report, I think there's other the almost tactics and all the way that you can make people come back and be loyal that aren't necessarily are at the core of building this like Apple style brand where like everyone is is a fan of. I think like that's what I think was really interesting as well. It's like there's a lot that retailers can do to bring this continuous relationships with the consumer that goes beyond the brand. We touch on customer service and we talk about incentives, for example, and promotion, people can be loyal to a brand because the brand has the best promotions, right? So I think that's very interesting. Yeah, great. Fantastic. Well, thank you so much, Kelsey. This was really interesting. I'm glad we had this conversation. I hope that our listeners learned a lot and that they will now go and read this fabulous report that you and your team put together. So thank you so much. Thanks, Gwen. And thank you to the Sinch team. We always love having these kinds of conversations and can't wait to do it again. Any time. Thank you. That's it for this episode of CX Education. Thanks for joining us. This show is brought to you by Sinch, the technology company that helps you create mobile experiences your customers love. Did you enjoy the episode? Then make sure to subscribe to CX Education wherever you listen to your favorite podcasts or visit sinch.com/podcast to get instant access to all the latest episodes.