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So, Who *Is* Your Customer?

Understanding who your customers are is the first step toward becoming customer-centric.

Video Transcript

– [Varda] Understanding who your customers are is basically the first step toward becoming customer-centric. Now, being customer-centric means putting your customer first, making them the core of your business. Now, in today’s highly competitive world, this is not optional, okay? If you want to win over and hold on to your customers, it’s crucial to communicate with them in a very personalized and relevant ways.

Now, during my couple of years in Optimove, I’ve seen a lot of companies transitioning from being product-centric to customer-centric, and a very good example for this would be social gaming companies. Those companies start off by being very focused on their game, their app, and its features. But however, once their database starts growing, they realize that they can leverage the data that they stored in order to become more customer-focused, to improve retention metrics, and to increase revenue. It’s also something that we see in the social game…in the, sorry, e-commerce space. A lot of those companies start off being very brand-focused, and as they grow, they realize they have a huge potential lays in their database, okay? So, this is where they become more customer-centric.

As you all probably know, using customer profile and 360 single-custom review, it’s enabling customers to be able to gain deep insights into the needs and preferences of their different customer segments. But in today’s panel, we’re not going to be talking about the technical aspects of how to know who your customers are using techniques such as segmentation. Rather, we’re going to focus on some aspects of hows and whys of becoming customer-centric.

Now, focusing on the customer makes a sound business sense, okay? It basically plays an instrumental role of staying a step ahead of the competition, all right? It can obviously increase revenues, improve efficiency, and drive performance. Now, in fact, a research that was recently conducted by Deloitte and Touche found that companies that are customer-centric are 60% more profitable than companies that are not focused on the customer, and this is why we’re talking about all of this today. So before we dive into some questions, I want to let our wonderful panelists to present themselves. So, Shahar.

– [Shahar] Thank you. Ahlan. Shahar Attias. I’ve been working in the iGaming sector for the past 16 years. I’m currently running my own consulting agency, worked with pretty much most of the online gambling operators in the world, focusing on CRM, maximizing lifetime value, and the lot.

– [Matt] Hi, I’m Matt. I’ve been working in CRM a few years, mainly in online marketplaces, most recently in Berlin in food delivery start-ups, and just really understanding which customers are valuable and how we retain them better.

– [Kris] Hi, I’m Kris Kukula. I’m the Director of CRM at Jumpman Gaming. We’re an online gaming company. We run and operate three different networks, and I oversee the CRM strategy for over 40 sites.

– [Eyal] Hi, Eyal Dror. I’m an independent consultant. I’ve been consulting several verticals, from CRM…sorry, from e-commerce to social gaming, Forex, strategic games, the lot.

– Thank you. So, let’s move on to the first question and start diving in. So, Kris, this question…we’re going to start with you. From your experience working with Jumpman Gaming for a couple years, I want to ask you whether the company was always customer-centric, or did it go through some kind of a metamorphosis to get there, and either way, if you can just describe how the company became customer-centric and what exactly drove it?

Transforming to a Customer-Centric Focus

– So, the aim has always been for Jumpman to be customer-centric, but achieving the level of customer-centricity we have today has been a long process, and it’s fair to say Optimove has been a key part of that process. The first step in this process was changing the way in which we view our customers’ lifetime journey by really understanding how they progress for our business, in order to identify the right marketing mix for every part of that journey. We changed from a very simple, linear and reactive approach, and adopted a new way of thinking about how our customers interact with our product. The new approach is all about analyzing vast amounts of customer data and coming up with highly-targeted, proactive customer segments, and delivering the best possible marketing content at the right time, through the right channel.

In addition, we now also continuously analyze our campaigns to refine and optimize them. Being customer-centric, for us, also means seeing the bigger picture, in terms of considering the customers’ future value, as well. We also believe that part of customer-centricity means having content which is relevant and personal to the customer, and as part of that approach, we create all of our marketing content in-house, and we believe that makes our communication relevant and authentic. And to summarize, I think being customer-centric is essentially win-win marketing. It’s a win for the customer, because they’re receiving relevant content which shows an understanding of their journey and enhances their experience of our product, and it’s a win for us as a company in terms of increasing profitability, as well as giving us an advantage in a very saturated market.

– Well, most of the companies that I encounter during my consulting projects, they were not customer-centric and this is why they’ve called me, so in order to lead such a process. I mean, in today’s world and Professor Libai talked earlier about cost of acquisition. Everybody’s smarter these days, and cost of acquisition increase. Competition is super saturated, companies which…especially in buying sector, okay? They see a lot of online gambling faces here. And especially in this sector, companies were based on acquisition first. We first get the traffic, then we’ll stay. Companies started to understand that they are paying higher cost in order to bring this traffic, and they are paying more per click and for registrations and mounting CPAs, yet retention level drops because their competition is better in the research. Customers have more and more opportunities to go and pick another brand. Regardless, I mean, we don’t know of a single customer that is playing on one single brand. They all play at least on five or six, and they have, like, their lucky brand or lucky day in which they go and play with this specific bingo room or whatever, or any online casino. And, as such, they understood that they need to focus more on CRM and switch the orientation of the company from acquisition first to customer-centric.

– In my vertical, it’s kind of similar to this. It’s quite interesting. At the beginning, the companies really care about customers in terms of numbers of them, like, the more customers they have the better, and the more they have, they’re happier. Then there comes some kind of tipping point when they’ve reached the critical mass, the acquisitions start getting more expensive, and then they realize, actually, now retention’s really important and what can we do about it? And then they really start diving into the data and this is really where things change. When they go, “Okay, there’s these two, three, four sets of customers and different personas, and they make up the majority of my business. I need to start treating them differently, finding out more about them and doing more for them.” And then, even the ones that are worth less. “Okay, now I’ve got the high-value ones, and I’m happy with what I’m doing with them. What can we do to make them the high-value customers in the future?” And just digging deeper and deeper in the data, I think it just opens Pandora’s Box, a little bit, and you become more customer-centric as you go.

– Thanks. I think that’s a good question, first of all. From my experience, companies are usually…they don’t start as customer-centric. The process is different from company to company, but for me, the end goal is when the CRM team is the champion of their own segments. Meaning, each and every one of the team members has their own segments that they are responsible for, their KPIs. Be it return level, be it lifetime value, and when they champion them, not only from the data standpoint, but also from the psychological standpoint. They know exactly what their pain points are, how to treat them and not just randomly send bonuses and free coins, and stuff like that, I know that this journey is complete, in that sense that they are now data-centric. The CRM has to impact both the product itself, in that sense, if customers have pain points related to the product, but also the company’s strategy as a whole, and until the CRM team does not become that champion, I don’t see that being possible.

Customer-Centric Marketing Means Targeting Individual Customer Personas

– Thanks. I remember that last year in Optimove Connect, we talked about the fact that a lot of companies, they are so focused on acquisition and bring in traffic, bring in traffic, and they don’t do anything with those customers at the beginning, but by the time they realize that it’s time to become customer-centric, they’ve lost so many customers they could’ve treated differently. And I know that Shahar, you were working with companies in the very early stages to start this from the beginning, and I also really like something that Kris mentioned about being very proactive, not only in terms of identifying those segments, but to create a very relevant and quality content in order to really talk to them in a very relevant way that will help retain them. All right, so let’s move on to the second question. Here, we’re really going to start understanding some examples. So, what I’m going to ask you is to please name two or three customer personas that you’re currently really focusing on and you believe that they’re unlocking business potential for your companies that, without being customer-centric, you would’ve never even thought of marketing to those specific segments.

– One interesting way of segmentation or perspective when it comes to trying to increase customer lifetime value in…at least my industry, in online gambling, is that specifically for online casinos, we understood that players have some sort of potential of switching from a specific slot machine…and players usually like the top two, three, four, five slot machines, and that’s what they usually play, but these games could be tagged according to a specific genre. So, going for the portfolio and tagging the entire variety of slot machines allowed us to cross-sell players from a specific slot machine also to another one. So, while noticing that they had a bad day at a specific slot machine that they like, we usually try to offer them also to have a chance at another one, in case they will be luckier. So, instead of cross-selling to a new brand, we took another approach and cross-sold them within the same brand into a different…it’s not even a different product. It’s the same product, but a different skin of it. So, this was successful, as well as looking at something that, for sure, if the company wasn’t customer-centric, we couldn’t have had the system that allowed us the multi-layered perspective of customer behavior, and specifically focusing on that, on customer behavior. This is something that is not flat. You cannot look at just, you know, a player net gaming revenue, or just frequency of logins or anything, not a specific parameter. When you combine everything together, and then…again, for that, the company need to go through the transition and have the database, have the systems, have the tools and the capacity to process it, then you can segment players according to types of behavior, and there you can really strike gold.

– A really important segment for us, even though it’s quite small, is high-value users that actually fail placing an order. With online food delivery, there’s plenty of reasons why. You went to order food and it doesn’t turn up or you don’t get to the end of that order, and whilst…if you’re not looking at it from a customer-centric manner, you might think, “Oh, there’s a few percent, like, a very tiny proportion of all orders, this happens. Okay, let’s work on it, but it’s not a massive priority.” But when you start looking at the lifetime value of those customers for which it happens, and it happens most to the most active customers that have the highest lifetime value, so I go, “And, actually, well, that guy just failed an order, and he was worth 200 euros to us.” Then management really starts getting interested in those customers, and then we really need to start thinking about, “Okay, how can we mitigate that? How can we, like, fix that problem that just occurred for that customer so they stay with us and they stay retained within our customer base and the high-value customer that they were before this incident?”

Then the next one, which is a like much bigger segment which is very interesting to us is the one-timers. We have tons and tons of customers who come make one purchase, and one order, and never go away…sorry, “never go away,” I wish that was a problem. Never come back, but it’s hard to know how to segment these customers and how to gather much data on them because they have very little behavioral history. We don’t know that much about the customer, so what we’re trying to find out is of those ones that have just done the one order, who are the ones that are likely to become a high lifetime value customer and how do we treat them differently? How do we make them feel special, and how do we focus on turning those into the really active users that we want?

– For us, an interesting customer segment would be players in the new lifecycle stage, targeted based on the early gameplay experience. This is the great example of customer-centricity where we act proactively based on how the players interact with our product. So, for us, we see it as an opportunity to reinforce positive winning experiences early on. And conversely, to also counteract bad ones at a crucial stage in the customer’s lifetime journey. And I think for the customers, campaigns like these show a deep understanding of their personal journey and show that we care as a company about their experience.

– I want to talk about two segments. The first one is the potential VIPs in the new customer lifecycle, and I think that Optimove is the best to identify those within that segment. Professor Libai talked about the comparison of the cost of acquisition versus the lifetime value. In a maturing company, we have to really, really, from the start, identify those potential VIPs and nurture them. That way, the average lifetime value will then compensate the increasing costs in customer acquisition, and again, Optimove is a great tool for that. I’m not going to go into all the details technically. The second one, which is I find a bit more interesting, is fake VIPs. I had a…an e-commerce company that I did some consulting for, and we had some really interesting VIPs ordering bulk amounts of clothes that were unreasonable for even the highest fashionistas in town, and it turned out that these were actually resellers, not private buyers, in a sense. And we had to then, obviously, isolate them very discreetly and offer them specific offers not through the system because they were distorting the data.

The Challenges of Identifying Customer Personas

– Cool. Thank you, guys, and the next question is following up on those segments that you just mentioned. So, now I want to ask you about the challenges that you were facing while identifying those personas that you mentioned, from the early stages of uncovering them to marketing to them, and how exactly did you address those challenges. So, I want to start with you, Matt, and tell us, how did you manage those challenges of dealing with those customers who had failed orders?

– Not easily, to start with. So, the first thing is identifying them wasn’t that difficult. So, getting the data of which user is in which segment and when they failed order and why. But then, actually, responding to that was the really difficult part. So, understanding, “Okay, how do we give something exclusive to this customer that makes up for their food not turning up? They’re hungry. Is it a voucher for their next meal, or…that kind of feels a bit empty because they just wanted to order like, 10 minutes ago. Is it a phone call from our customer service? Which seems to be working much better, or what touch points can we do to really kind of make it up to them?” What we’re learning and kind of learning slowly is that the more touchpoints, the better. It’s not that you just have to respond that instant, in that specific time. You need to then follow up later with multiple touchpoints and just really, really have them so they become that happy customer again.

– Eyal, would you please talk a little bit about those fake VIPs? What exactly do you do with those people, eventually? Content, communication. What exactly are the target and the goals from this segment?

– Well, potential VIPs are hard. Since they are actually resellers, they don’t really belong in a B to C platform. What we did was, first of all, isolate them. We had to approach the problem really carefully because they were buying the best stock that we had, so essentially, driving traffic away, because if you are a woman in a size medium, and I just bought all the stock in size medium, you’re not going to come back to my site. We then approached them really individually. We called them, even, some of them, and made specific offers that would enable us to still sell the bulk of our clothes to actual customers, while offering them either remnant stock or specific pre-launch promotions so that they would still be interested, because the loss of their income would be severely affecting our bottom line.

– Kris?

– Sure. So, for my example, based on gameplay experience. Obviously, winning customers, the communication has to be relevant to their experience. So, we’d say something like, “Congratulations,” you know, “Well done on winning. Here are some other games you can try.” In terms of losing customers, I think it’s crucial to target them very early on and recognize that they’ve had a losing experience and counteract it in various ways, be that a bonus or a freebie, that sort of thing. I also think another challenge is also finding, once you’ve come up with a segment, finding an organic way of working it into your existing structure, because often, having too much communication going out can actually disrupt the gameplay experience of the customers.

– In the specific cases that I’ve detailed, actually, the major challenge was technological, meaning how could you identify or analyze big data using, you know, usually, legacy systems? In this case, Optimove actually was a great help, both in the ability to assist with segmentation, as well as with the functionality of real time, in which you could identify high-value customers who are on a losing streak, and approach them quite… I wouldn’t say instantly, but before they are leaving, which is the major fail point that you don’t want to reach. You don’t want one of your VIPs to leave the gaming platform while having a negative satisfaction or dissatisfaction from the gaming experience. You want them to at least know that somebody’s with them and talking to them and holding them by the hand.

How Being Customer-Centric Improves KPIs

– Thanks. So, in general, yeah, the challenges are really starting from uncovering those segments, and it’s not all. Once you’ve uncovered them, so it’s really about working on the proper content, and the proper channels to communicate with those customers, not to bombard them too frequently, and in general, we’re looking at plenty of challenges that we need to address. But overall, if you’re identifying those important segments it can increase your revenues by correcting their negative experience, or just to maintain them, to retain them, then you can get to, basically, the benefits that you need. And if we’re talking about benefits… So, the next question I want to ask you to give, like, real examples of what are the most important business metrics that you’ve seen that have improved as a result of being customer-centric? So, I would love to hear about that.

– Oddly enough, what we found out is that the second-level metrics, not the straightforward ones like profitability, frequency, anything that people usually monitor, even when they don’t have systems like…and they can monitor it using Excel sheets. We found out that when the company shifted into becoming more customer-centric, with a more customer-centric orientation, the business KPIs that assisted us when we’re monitoring, for example, the operation of the call centers, or the efficiency of the CRM teams, those business KPIs have improved. And we’ve just publicized a new article about efficient call center management on my LinkedIn profile, and these specific cumulative and quality of parameters have greatly improved. Which also makes sense, because once the company switch into customer-centric orientation, then it means that those parameters become, by far, more vital for the company, and the company pushes in order to improve them. As such, leading the teams that are in charge of overperforming those targets is becoming a lot easier because it’s the main goal of the company after we’re doing this shift.

– I agree. Hard to follow. So, for us, we saw incremental, like, improvements in things like MPS scores, conversion rates, as you’d expect. We started to reduce the number of failed orders we had. So, everything kind of as you would expect, but the one kind of small thing that we didn’t expect is the way that the customers kind of started responding to us. Not through their order pattern or anything like that, but replying to our campaigns. Whether they’re replying to an email campaign they got, or they’re commenting on Facebook that they just received this and it was really nice. And like, getting that feedback from the customer on what is quite a transactional brand for something they just want in that moment was kind of a really nice thing to see and kind of keeps the spirits of the CRM team a bit higher than usual, which is nice, as well.

– For us, customer loyalty has greatly improved. Our players now play more, and do so over a longer period of time, and this is reflected in a whole variety of KPIs from deposits and wagering per player, and the amount of time they spend in the active lifecycle stage. But if I have to boil it down to a single metric which has improved the most as a result of Jumpman becoming customer-centric, it would have to be our profitability, and I think that makes a great business case for customer-centricity.

– Well, I’m going back to my e-commerce example. I think that the most surprising metric that was increased was…or actually decreased was days in stock. We all know the case about Zara and how their turnover from production to sale of the stock is really, really low, and that is measured in a KPI called days in stock. Since we were able to better match our existing clientele base with the existing stock, we were able to reduce the days in stock as a KPI, therefore increased the turnover, getting new clothes into the platform faster, and again, selling them even faster, and thus contributing to the bottom line.

– It’s nice to see, like, that there are indirect metrics that are influenced by, you know, implementing proper customer-centric approach, and I think that other than all the monetary metrics, customer engagement is a very strong one that obviously has a lot of impact to any other KPIs. But Matt mentioned the way that they’re replying to the campaigns, which…it is really nice to see, and in general, if by, you know, being more targeted and relevant, you’re able to create more engagement…

– Well, so, first of all, each and every campaign starts with, actually, the answer. Meaning, “I know my segment. What do I want them to do?” That’s my KPI. I don’t expect churn users to come back and immediately pay, because that would be crazy, or lucky. So, the KPI has to be preset before you even start the campaign. After that, you work your way backwards. “This is what I want them to do. How do I want them to do that?” Obviously, A/B testing and Optimove has a great tool for that, but if you don’t start with the end question, you will end the campaign with no actual conclusions, and that would be, for me, the worst case.

– Roughly speaking, you should probably, as well as you segment your customers, segment your KPIs and make sure that you divide them into groups of, you know, profit-oriented, second tier, up until to the point of where the teams are now…they conduct their jobs easier and they are happier, okay? And if you have all of these together, then you know that something good is happening. So, it could start with direct things, campaign by campaign, and it could end up with having the same employees working for longer periods, and you don’t need to keep rotating agents in your call center again and again, because everything is now “sababa.”

– Yeah, I agree with what was said. So, basically, have an understanding of what KPI you’re looking to achieve or to improve with a specific campaign, and also, you can see the overall KPIs for each segment, for example. That’s a good way of understanding how your segment is performing.

– This could be a topic for a full discussion, but I would just want to add something to what our panelists said here. Just keep in mind that you have short-term metrics that you want to measure and long-term metrics. So, the short-term would be around analyzing campaigns and understand the success using test and control groups and A/B tests, but again, even that, don’t just do it one-time thing. Just do it repeatedly, and then the long-term measurement should be, you know, taking into consideration different metrics and KPIs across the general business performance. So, you would really monitor all the…you know, the obvious metrics, like customer spend, and the retention rates, and churn rates and all those things. But start from the short-term, defining what are the KPIs that you want to…you know, to improve in the short-term and then look at the long-term perspective of things.

How Do Expert Marketers Define Customer-Centric?

– Short question from the other side. Almost every company I talk to thinks it’s customer-centric. So, nowadays, everything is customer-centric, and I wonder when you talk about customer-centric, what do you mean? When you see a company of product-centric versus customer-centric, how do you know it’s customer-centric? I mean, are there measures? Are there ways? Things they do? Some measures? How do you know about it? What do you call customer-centric?

– So, I’m going to start by saying that I’m working with a lot of companies and I see it very clearly at the beginning. It’s very easy to identify it, once you come to a company and you understand the structure of their departments and their resources. So, it’s very clearly that a company that has a CRM department and has CRM manager, they’re a company that already made their…at least several steps of becoming customer-centric. And the companies that they have a marketing person that has PPC and all the rest of the marketing stuff, and this guy’s also going to do CRM and VIP and everything, then you understand that the company doesn’t really understand the meaning of customer-centricity. But, please, you guys share some of your thoughts.

– First of all, if all the companies that you meet think that they are customer-centric, then you should meet some of my clients, but at large, I fully agree with Varda. It starts even at the first step you take into the office, and you can see if this company…you know, what leads them, what motivates them, what they think is important. When I say customer-centric company, I actually mean a company that knows that they would do whatever it takes, within profit sense, in order to make sure that the client would continue to consume their service or use their product. Again, many companies, at least within the gambling sector look at customers that already…every customer that joins in or makes the first deposit as sort of like a churn tab on its forehead saying that, “I’m going to say for three months, and that’s it,” and they just accept it as, you know, face value, and no more than that.

– I see a lot of internal struggles of…the company thinks it’s customer-centric, but then it gets to the end of the month, and orders are down a little bit, and then customer-centricity goes just second parcel for a short while, and I haven’t…don’t think I’ve seen it where it’s 100% yet, if you can be 100%. But things like making it easier for your customers to contact you, rather than closing down a call center because it’ll save you some costs. Those kinds of actions that I already mentioned that they kind of give you a good barometer of how much this company cares about its customers.

– I think understanding your product and seeing it from a customer’s point of view is a good indication of that. So, when we design our products, we try and think of that customer first and how they interact with that product, and the same goes for communication. We design all our marketing content in-house, which I think is authenticity and makes it relevant for the customer.

– Well, when I first enter a company, the first thing I ask for is the technical roadmap, and I take a look at the features within. If half of them, at least, are customer-oriented, I know that they’re customer-centric, because I know that the CRM has an influence on that roadmap. If it’s all about infrastructure and blah blah blah and servers and stuff like that, they’re nowhere near.

– All right, so we need to wrap up. Big applause for panelists. Thank you very much. This was very insightful. Thanks.

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