Customer Strategy Archives - Page 3 of 5

Understanding whether a loyalty programme is right for you

Posted on: 14 March 2023

How do you decide when to create a loyalty programme?

All businesses will eventually face the existential question of whether they should implement a loyalty programme or not. Understanding the value in doing so is paramount— customer loyalty is a big question for a lot of brands, and few know where to begin to devise a promising loyalty scheme, with many brands lacking an understanding of the potential return on investment. It is also integral for brands to have a business case prepared prior to formulating the loyalty programme’s design, as this knowledge will sway the development entirely.

Why brands might be thinking of this now

There are several factors that may prompt the creation of a loyalty programme– increasing share of wallet, encouraging customers to buy directly from a brand versus through a third-party retailer, or enhancing direct customer relationships to drive repeat purchase behaviours. No matter what the driving forces, businesses have become increasingly aware of the impact that customer insight has on informing an effective loyalty programme and the potential cost and risk of not introducing one into your own business.

What risks are associated with creating a loyalty programme?

Improperly planned and executed loyalty programmes can result in hefty costs for businesses, plummeting bottom line profit figures and an inability for revenues to bounce back.

Additional elements you must consider when implementing a loyalty programme include:

Getting the value exchange right

If customers do not understand the point or see the value behind your business’ programme, it will not be successful. Getting the value exchange wrong can erode your brand’s impression on customers. If the programme appears worthless as opposed to rewarding, it will fail to increase customers’ sentiment or engagement with your brand.

Getting the level of innovation right

Loyalty programmes must be innovative and uniquely tailored to a diverse customer base. Your business must meet customers’ expectations in one cohesive programme versus through multiple solutions, which demonstrates the importance of value exchange– meeting the wants of customers without sacrificing your business’ value.

Getting the loyalty mechanic right

You must be mindful of what customers are looking for from a loyalty programme, but this understanding must be backed by a data-driven approach that allows you to understand the unique selling point for your customers. There are a few approaches you can take:

Tiered loyalty programme: This splits benefits into tiers or levels that customers spending certain amounts of money can achieve. The higher the tier a customer reaches, the greater the benefits will be.
Points-based loyalty programme: Customers are given points with every purchase they make, and when they reach a certain number of points, the points can be used towards a discount or reward.
Subscription-based loyalty programme: Customers that sign up for subscription-based loyalty programmes will pay for their subscription upfront or in monthly or yearly instalments to receive exclusive discounts or rewards.

A lack of access to customer-centric data and an understanding of your customers’ wishes, however, will hinder a loyalty programme’s capabilities.

What should you consider before creating a loyalty programme?

Is your business bought in, engaged and set up to support a loyalty programme? Do you have the right technology and CRM in place, an existing loyal customer base and the ability to continue to sign up new customers?
Is a loyalty programme worthwhile for your customers and for you? Have you listened to your customers’ value mindset in terms of the product or offering to conclude the best potential ROI from your loyalty programme?
Is your business clear on how to enter the market in a way that will demonstrate ROI? Does it have the necessary mechanics or programme in place to pilot in the market to provide a successful ROI? Are you aware of the potential opportunity it can bring?

If you can answer these three questions, you can conclude whether now is the time to create a loyalty programme.

What steps should your business take to implement a successful loyalty programme?

Ensure your business is equipped with the necessary data to determine a loyalty programme’s value and discern what a good outcome for your business would be. This can be done through data analysis, best practices and benchmarking that will help you effectively align internally to understand existing capabilities and how best to proceed.
Confirm that your customers want a loyalty programme. If they do, what does a valuable loyalty programme look like for them, and what is the opportunity for your business? Identifying the value to the customer as well as to your business through data enrichment and data science will be a key next step.
Determine the ROI that your loyalty programme can deliver and understand what type of mechanic should be used in the pilot market to achieve this. An assessment of the scenarios of mechanics should be carried out to determine this. Once the opportunity from a viable mechanic is understood, determining how to effectively enter that market in a way that will deliver ROI will be crucial.

How can CACI support you with implementing a loyalty programme?

CACI’s data science capabilities and Customer Engagement consulting team can determine the actual costs that your business will face in running a successful loyalty programme and support your business through an innate understanding of loyalty across enterprises.

We do this by using our own proprietary data, data science, and expertise to understand the headroom in the market and help determine KPIs, understand which of your customers want a loyalty programme and how they want it to look to inform what potential opportunity exists. Areas that we assess to inform this include demographic richness, compliance for use, permissions, and our own products to fill any gaps around customer segmentation to determine who customers are and ask the right questions.

Our teams of data scientists and consultants will scenario plan with your business to comprehend the mechanics and experiences that must served and managed to your customer groups to build the pilot. Once this business case is understood, and a feasible pilot market has been identified, we can design a sophisticated end-to-end offering to help you deploy a successful loyalty programme.

Could your business benefit from a loyalty programme? To learn more about how CACI can help you, contact us here.

DataHub: High Quality Data Unlocked

The growth of online: a surprising pivot in 2023

Posted on: 13 February 2023

Over the last three years, we have seen a more significant shift in consumer habits than we could have imagined. Currently challenged by the rising cost of living and an economy in recession, the post-pandemic spending bubble was cut much shorter than initially anticipated by economists.

Like everyone in January, CACI reflected on the last few years, and as part of this, we revisited predictions that we made during the height of the Covid-19 pandemic. Consumer behaviour changed significantly in the space of several days, triggered by widespread temporary store closures during the lockdowns. Some stores were never able to reopen; whilst online platforms boomed, in light of these significant behavioural shifts, CACI rebuilt predictions to reflect this new normal.

How close were CACI’s consumer online spending predictions to actual results?

Mirroring our spend predictions, a phrase we maintained at CACI at the time was that “online spend jumped forwards five years in one month”. What we have come to realise was that three years on, these spend predictions, shown in the below chart, highlighting a return to in-store, were very close to the true picture.

How can CACI track consumer online spend behaviour?

CACI can unpick these new trends in spend behaviour using our new and exciting tool kit of Spend Dimensions and Brand Dimensions, which tracks over 200 shopping centres and 300 brands across the UK.

What we can see demonstrated in the above chart is a post-pandemic slump in online spend as a proportion of total spend. In 2023, online spend falls to 38%, before gradually rising again in the preceding years.

Whilst the current split in online and offline engagement provides us with an overall national average, it is important not to expect all shoppers to follow suit. We have seen asset type, product category, brand, region and demographics all play a big part in the extent to which a shopper might engage online.

Who is most likely to shop online?

Demographically, the split between those engaging in-store and online has become less distinct, highlighting the closing of the digital gap between young and old, with the difference between online market share across all groups dropping from 10% to 5% over the last year.

However, the big picture doesn’t change. Key online shoppers continue to be younger shoppers across the affluence spectrum as well as more affluent shoppers, likely driven by greater access to e-commerce platforms and the ability to afford delivery costs.

How does this vary by product category?

The recent shift back towards in-store engagement isn’t clear-cut and does vary by product category. CACI expectations were that the drivers of the overall return to the store would be clothing and footwear, household and health & wellness brands. This has been the general spend trend that we’ve been seeing across the UK since 2020.

The variation by category gets further exacerbated by the time of year. For example, comparing the months of October to December 2021 and 2022 in the chart below, there was a clear shift for household and kids’ goods spend to in-store, likely driven by the desire to experience before purchasing. Whereas, General Retail painted an interesting picture within the final quarter of 2022. Both in 2020 and 2021, with Black Friday and Cyber Monday taking place in November, Christmas hit online earlier than in-store, boosting online’s share of the market temporarily. In December, our Christmas survey reiterated this sentiment, with over half of those shopping online citing a main drive of this being concern with the rising cost of living and saving money, whereas over half of those shopping in-store did so for the experience. The experience-focused, in-store shoppers drove the resurgence year-on-year of in-store spend in December.

What does the return to in-store mean for retailers?

Across the 300 brands we tracked, many pure online brands are experiencing a decline in market share, in-store brands have typically performed well, and those blended brands have seen a shift towards a greater in-store market share. The power of the store can be seen through brands such as Decathlon, Nespresso, Build-A-Bear and Denby, who have all shifted to greater reliance on the store over the last quarter. In comparison, online disrupter brands such as Vinted and Shein which thrived through the year began to see a drop off.

What does the future of consumer online spending behaviours look like?

Whilst 2022 did represent a return to bricks and mortar, we are still at least a year ahead of where we would have been if the pandemic hadn’t happened. We expect to see continued growth in both on and offline retail spend, although proportionally online spend will increase.

However, it is undoubtedly true that we are currently, and will continue to, experience unexpected macroeconomic challenges which will impact different brands and destinations in different ways. Brands can no longer rely on their name as we have seen with the casualties of too many well-known landlords and retailers. Therefore, making informed decisions through the use of CACI data will help retain a competitive advantage and stand out from the market.

To learn more about how CACI can help your brand navigate changing consumer spending habits, get in touch with us here.

Elevating Customer Experience with High-Quality Data: The Power of DataHub

Posted on: 7 February 2023

“Garbage In, Garbage Out” (GIGO) is a well-known adage that holds true across various industries, including sports nutrition, education, wine making, data science, and, most notably, customer experience.

Poor-quality data can undermine confidence in reports and impede the implementation of personalisation and other data-driven initiatives.

At CACI, we are dedicated to harnessing the power of data to deliver remarkable results.

High-quality customer data is critical to this mission. Data that is accurate, consistent, and free from duplicates will enable us to optimise customer loyalty, personalisation, AI/ML, conversion optimization, and regulatory compliance.

To ensure that our data is of the highest quality, we adhere to the following criteria:

Demographically rich: The data provides insights into the customer’s identity and lifestyle.
Standardized: The data is consistent across systems, allowing for quick and efficient processing.
Veracity: The data adheres to your standards for validity and consistency.
Free of duplicates: The data is resolved at the individual level to avoid double counting and over-communication.
Consistent identifier: The customer is identified consistently, regardless of the source.
Predictive: The data contains variables that enable modelling and prediction of customer interests and needs.
Compliant: The data adheres to relevant consent and permissions standards.
Understood within the organization: The data is accessible and understandable to stakeholders.

To address these challenges, CACI has developed DataHub, a solution that solves data quality issues faced by brands. DataHub was built on the experience of working with leading brands in retail, publishing, financial services, gaming, and utilities.

It processes and enriches data in real-time using a scale on demand cloud native architecture, engineered to work with your data, wherever it is stored. For CACI clients already using Acorn, Ocean, and Fresco, DataHub provides dynamic, real-time enrichment of data, enabling real-time personalization and optimization of the digital or call center experience.

To learn more about DataHub and its flexible integration options for all use cases and enterprise architecture needs, download our short brochure or reach out to us for more information.

Let’s work towards a future where data quality is no longer a concern.

A Customer Personalisation Platform to deliver change for financial services brands

Posted on: 3 January 2023

Change within the financial services sector is complex. There are multiple stakeholders, regulatory needs, and often a base of legacy data and technology to unpick.

From our work with major brands, we know that the change is achievable and worthwhile. Investing in customer centricity will pay dividends in the long-term by reducing competitive threats, winning new customers, and ensuring retention of base customers.

To succeed in an increasingly competitive market, financial services brands need to establish change that encompasses:

A coherent data-driven strategy – where customer data is of a high quality and securely democratised to enable meaningful messaging to the individual
Establishing the right business targets and success measures – moving from short-term outcomes to long-term value for the customer and the organisation
A focus on your customers and the market context – understanding the needs and behaviours of both customers and prospects to better engage them
Maximising data and tech ROI – having the right tools to deliver the outcomes the business needs and then sweating the technology assets to deliver long-term ROI
Measure and optimise what matters – ensuring accurate reporting is fed through the business and that teams are empowered to act on those insights to optimise performance

Our challenge to leaders within financial services is to create a vision and become an agent of change. We want to work with brands who care about their customers and are making changes to show it. Therefore, our catalogue of services is developed to do amazing things with data and connect your brand with the individual.

At CACI, we can improve marketing ROI through detailed attribution modelling. Our customer demographics and bespoke segmentations provide a more accurate profile of customer needs, market size, and even financial vulnerability. Technical decisions around investment in AI, decisioning or identity resolution are made by defining clear use cases for technology and designing future technical architectures.

This work led to CACI developing a framework for customer personalisation at scale. Working with leading vendors Tealium, Braze and Snowflake, we created a technology blueprint that can achieve full integration between enterprise data and the omnichannel experience.

To find out more about the CACI Customer Personalisation Platform or to discuss issues related to customer transformation, please get in touch.

You may also be interested in downloading this report which uncovers a surprising disconnect between what banks think and how customers feel about the customer experience, with statistics and insight gathered from 1,500 marketing leaders and 5,000 consumers.

You can also check out the previous parts of this blog series below:

Blog 1 – How the banking and financial services sector can lean into a changing market

Blog 2 – Creating human banking experiences through data-led marketing

Blog 3 – Three ways to stand out in a crowded insurance market

Blog 4 – Combining data and technology to deliver effective customer journeys in the financial services industry

Adopting a Customer-Centric approach: How truly valuable is it for both your business and your customers?

Posted on: 16 May 2022

Brands are increasingly finding more ways of communicating to their customers by using extended methods of personalisation to grow customer retention and overall profit. The end-to-end process from learning and understanding your customers through to developing personalised communications is often complex, however adopting the right principles from the outset can ensure that the right steps are taken to achieving the wider goals of the business.

Understanding Your Customers

Understanding your customers commonly begins with an exercise in segmentation, allowing you to build a view of your customers’ interactions with your brand through the lenses of different audiences. A customer journey map then allows you to visualise each of these interactions in a linear journey to evaluate this view across several life stages and touchpoints.

What is the value added to your business?

By putting the customer at the heart of all decisions and communications and adopting a customer-centric approach, it will allow you to fully understand their behaviours, needs and expectations. The key value of a customer journey map is that it allows you to do this by considering all available data in context, rather than risking looking at information from fragmented sources in isolation. Being aware of these elements will enable you to create an end to end strategy based on a holistic data view.

Additionally, a customer journey map allows you to improve internal collaboration and alignment within your business amongst different departments (marketing, sales and operations). Together you will understand which activities to prioritise that make an impact on your business and your customers and will eventually cut counterproductive costs.

What is the value added for your customers?

The fundamental value it brings to your customers is that it leads to the creation of personalised experiences and in turn, customers will build more trust and gain a closer relationship to your business and your brand.

What happens if I ignore this step?

Failing in doing so will cause your brand to risk in sending communications to customers that are not reflective of the truth or their needs. It only takes one bad interaction with a customer to turn them towards competitors…

Talking to your Customers

A contact strategy is a visual representation of a planned communication strategy which creates a clear step by step plan of communication content, channels and time frequencies. It gives you the ability to deliver the right message, at the right time, to the right audience across a range of different channels. Essentially, it translates aspirational customer journeys into actionable campaigns.

What is the value added to your business?

To achieve better outreach, repeated visits and overall customer advocacy, it is important to plan the content, frequency and channels that are most effective for a given audience. While it allows the planning of cross sell and upsell, it also allows the nurturing of new and current customers through automated and/or triggered campaigns tailored to each customer profile.

What is the value added to your customers?

Planning and organising the communication flow avoids overwhelming the customers with unnecessary communication as each message is triggered according to the client’s prior behaviours and preferences, at the right time and through the preferred channel.

What happens if I ignore this step?

Communicating without a contact strategy relies more on frequency than anything else. Bombarding customers with fragmented communications can in turn damage the ROI achieved from each campaign as well as generating low traffic to your platforms.

There is clear value in going through the necessary steps to understand and communicate with customers in the right way. At CACI, we specialise in taking clients through this journey and our team of consultants can help you build your own. If you’d like to schedule time with our marketing consultants to discuss how you can create a customer-centric marketing strategy, please get in touch.

The bridge between Customer Experience and Brand

Posted on: 24 March 2022

It’s no surprise that customer experience has long been a priority for brands. There’s an overwhelming supply of research out there which demonstrates the importance and value of investing in CX; IBM found that businesses that prioritise CX see a 3x increase in their revenue.

However, one of the interesting differentiators between those who are really ‘winning’ in this space and those who are playing catch-up is the perception of the role of CX within brand development and communications. Whilst brand touchpoints are usually considered across ATL, TTL, BTL and POS, the reality is that brands are not just experienced within comms – they are engaged with across every touchpoint, platform or environment that a prospect or customer may find themselves in. A person should feel a seamless relationship with your brand, and with each interaction comes a wealth of information to harness and share within the business.

Where brands are losing out

Many businesses operate with marketing and customer experience departments that work independently of each other – the former focused on impressions and engagement metrics and the latter responsible for conversion optimisation and customer satisfaction. The gulf exists because these objectives are isolated, but both departments can offer invaluable information which supports the development of a cohesive customer and brand experience.

Demonstrating and measuring your values

Looking beyond customer experience ‘hygiene factors’ and conversion metrics allows you to build the right environment for your brand to flourish by having a bespoke approach to demonstrating your values. For an insurance brand, this could be the recognition and delivery of empathy and integrity when dealing with claims.

For an automotive brand this could be the sentiment of luxury and special attention that comes from purchasing an expensive new car. The whole brand falls down when these moments don’t live up to expectations, so these values should be present in all interactions, not just in communications.

Learning from the front line

Passing information back upstream is key to ensuring your brand is living up to the promise it sells. Customer reviews, call-centre recordings, satisfaction surveys, wait times and issue resolution rates are examples of information sources that would typically paint a picture of whether your brand is being perceived through the positive lens that is promised in communications.

Audiences will see straight through promises which are made but not kept to. Differentiating yourself in communications is only worthwhile if those differences are experienced when new customers (and existing ones) interact with you. If these are not present, audiences won’t stick around – they decided to give you a chance, so they can do the same for others just as quickly.

Operationally, your teams should be setup to interface and share regularly. Objectives and KPIs should straddle multiple teams and include metrics which govern your values, not just your bottom line.

Start bridging the gap

At CACI, we’re experienced in helping leading brands deliver a seamless customer experience. If you’re ready to start bridging the gap between your customer experience and brand but don’t know where to begin, our team of consultants can help you create a customer strategy and customer marketing solutions that deliver.

One size fits none: why the future of effective digital marketing must speak to the individual

Posted on: 10 August 2021

In a world of multiple channels and differing formats, is it really possible to deliver brand-consistent flawless campaigns whilst communicating on an individual level?

Everyone loves pizza, right? Meet the Taylor family. Three generations of pizza-enthusiasts. Louisa is 15, obsessed with manga, baking, and social media. Her mum, Ellen, 44, loves running, and uses apps to manage her busy life, and her running times. Louisa’s granddad Mick, 71, is never happier than when fishing, and likes to catch up with his pals via email or text. As self-confessed pizza fanatics, loyal to their number one brand, they all want to know when the latest pizza has landed, or about a great deal on their go-to favourite. But should their beloved brand communicate this information in the same way, on the same channel? In short, no. Because which channel could possibly reach them all? And even if there was a single, magic channel, what single message would get them all interested?

Making sure matching luggage doesn’t become lost luggage

The beauty of the digital customer marketing evolution is that products or services with mass appeal can now speak to the masses, individually. Meeting them where they are, and talking their language, so to speak. It’s now eminently possible to make the biggest splash with each interaction by delivering the right message, on the right channel, at the right time.

Whilst it’s crucial to have brand consistency and content to be optimised across channels, we mustn’t forget the nuance that ensures your communication isn’t just a shot in the dark. Receiving generic content that doesn’t fit with your own lived experience or lifestyle is going to be a miss every time. If we start to shift the focus to making an emotional connection, we begin to reframe the expectation that communications can be as unique as the individual receiving them.

To hit the mark requires a level of understanding. You’ve got to know who you’re talking to, you’ve got to appreciate their motivations, and understand the channels you’re working with, to make the message work. Fed by data-led customer insight, a comprehension of your audience enables dynamic content to work at its hardest and humanise the communication. Personalisation can permeate far beyond their name, it can be their latest purchase, their location, even the weather at their location. Analysis of consumer behaviour not only leads to the most appropriate channel, but also aids an understanding of the most effective incentives, that inform the tone and language that will trigger the desired emotion and ultimately create a connection.

Making the connection, one slice at a time

The explosion of digital data makes a connection with customers, in theory, more possible than ever, but is dependent on having the right approach and using tools that are up to the job. Using a data platform such as Tealium to blend data sources, can layer an understanding of each customer. As a result, the creative can be tailored using platforms such as Moveable Ink, to leverage messaging for maximum impact. Harnessing the power of a cross-channel solution such as Braze, will ensure each individual receives a compelling, real-time, personalised experience on each channel.

So, what does an individualised approach look like in practice? Let’s take the example of Louisa’s family and a brand-new meal deal. Reaching Louisa on Snapchat, using localised references to create resonance, and quirky, interactive content that compels her to share, helping get the word out that it’s that time of the week. For Ellen, a rich push notification encouraging her to ditch cooking in favour of a takeaway is positioned as the solution she needs after a busy day. And for Mick, a text to remind him of the tasty pizza he had last week and nudging him to share another with a friend, could be enough to down his fishing rod and place an order.

Of course, the family are most likely to engage with the brand over several channels, necessitating a seamless omnichannel experience. The building of intelligent data profiles through CACI’s consumer segmentation tool, Acorn, can make it easy to recognise your customers, so they can feel seen, making it more about the customer than about the channel.

What can we ‘takeaway’ from the example of the Taylors? As we become ever more saturated in media and our methods of communication diversify, the need for consumers to feel they are the only person in the room becomes ever more pronounced. Moreover, with the right tools and understanding, it is infinitely possible.

Getting the message: the art of communicating content that will connect with your audience

Posted on:

More than ever customers expect brands to speak to them, not just literally, but with content that they relate to. It’s not enough to have a phenomenal product, a killer marketing strategy and an arsenal of digital tools – if the messaging is off, it could all be for nothing. Your content is the most direct route to connecting with your audience on an individual level, so using techniques including emotion and narrative, as well as making sure the message fits the channel, is vital to maximising every valuable opportunity.

Sorry, do I know you?

The key to on-target messaging is knowing your audience, and it all starts with the data. Once you’ve collected profile data and created meaningful segments through Tealium and CACI’s consumer segmentation tool, Acorn, you will have a deeper level understanding of who you’re talking to. You can personalise content effectively, far beyond first names, using their last interaction or other details to bring a conversation to life, effectively mimicking one-on-one communication. Knowing a customer inside out means you can signal the values that align with theirs or share their vision for a better life. And the more data captured, the more sophisticated and creative the personal touch can become.

Once upon a time…

Once you have an idea of your audience, how can you effectively capture and hold their attention? Evolved over thousands of years, storytelling is the most powerful tool you can use to compel the brain. It has the ability to communicate so much, including, by using the brand as the personality at the centre of the story, who the brand is. Good storytelling uses the power of language and, where possible, causes you to pause and reflect, making it more likely to stick in the memory.

But storytelling doesn’t need words, visual narratives are equally effective and better suited to social media. Videos can prompt a stronger emotional response and are more likely to be shared, whilst imagery can solidify feel and focus. User-generated content can help tell stories whilst having the added benefit of generating trust in the brand. Storytelling in this way isn’t a hard sell. It takes the approach of content marketing, that is, nudging behaviour through being thoughtful, relevant and engaging.

Once more with feeling

Humans are fuelled by emotion – we feel first and think second. Using language that triggers emotions we are hard-wired to respond to can be very effective. Love, fear, anger and guilt are all primitive drivers of behaviour. By knowing your audience, you can speak directly to their individual joys, fears and pain points, and ultimately inspire them to take action. For example, a car’s anti-lock braking system may help you have more control whilst driving, but if you say it helps keep your family safe, it taps into a desire to protect your loved ones and is more likely to resonate.

After the turmoil of Covid, most people feel the need for connection more than ever. The global pandemic has reminded us that we all crave the very human experience of bonding.

Using emotion to cultivate a sense of belonging can establish a connection which is more impactful and longer lasting. It goes beyond selling, it’s a way of bringing authenticity to a brand’s identity and helps the reader buy into the brand values and ethos.

Mixed messages – making the message work for the channel

Increasingly consumers take different pathways to making a purchase, having different touchpoints along the way. Whilst it’s important messaging is consistent, it doesn’t have to be adhered to rigidly. With an awareness of which audience uses each channel, the message can be creatively tailored using a tool such as Spirable to have the most impact on the target audience.

For example, Instagram is more likely to be used by Millennials or Generation Z, so messaging needs to align with their interests and needs, and the tone will be more assertive and dynamic. Email marketing provides an opportunity to pique interest through weaving more narrative, focusing on messaging that resonates with the demographic, whilst push notifications can use real-time content to engage and visuals to bring a message to life.

There’s no one quick fix to creating a message that connects with your audience. But a combination of personalisation, focus on tapping into an emotion and telling a story are more likely to make your reader sit up and take notice, and make sure your message doesn’t get lost in the noise.

Driving a better understanding of Electric Vehicles

Posted on: 8 July 2021

Rapid growth in Electric Vehicle (EVs) sales in recent years (180% YoY in 2020), aided by strict government emissions targets for 2030 and substantial investment from automotive manufacturers, suggests that UK consumers are all set to go along for the electrified ride. However, even as EVs now account for 6.6%* of the overall UK car market (Autocar 2021) and, 9% of our recent survey audience already own one, the gap between the perception and the reality of owning and driving an EV will need to be bridged before they become an automatic consideration. In order to capitalise on the increasing demand for EVs, companies in the automotive sector – whether manufacturer, service or utility provider – need to be able to identify and address the unique concerns of different consumer audiences.

In our previous blog “Understanding Differing Consumer Attitudes on the path to EV adoption ”, we explored how attitudes to EVs differ amongst CACI’s Acorn classifications of the UK Population. However, going electric is more of a lifestyle change than simply buying your next car and factors such as battery size and range, where you live and, the availability of charging infrastructure are all key considerations. Our survey allows us to compare the perceptions of those who don’t yet own an EV with those who do, so how does the reality of going electric live up to the promise (or threat)?

There was little separating owners from non-owners when it came to the key advantages of driving an EV, suggesting that manufacturers and advocates have done a good job of selling the dream.

*Includes sales of battery electric vehicles only, excludes plug in hybrids.

While only 28% of owners highlighted lower servicing costs as a benefit (compared to 33% of non-owners), this was reversed when it came to fuel/charging costs, which 71% of owners see as a benefit (compared to 69%).

The biggest discrepancy in response, related to EVs producing less noise pollution. Only 41% of non-owners recognised this as a benefit, whereas 59% of owners enjoyed the quieter ride their EV gave them (and those around them).

Non-owners tended to be more sceptical of the disadvantages of owning an EV, perhaps as a result of negative press and a limited understanding of their mobility requirements. Take range anxiety, or concern that an electric battery won’t provide enough charge for drivers to get from A to B without needing to stop for an extended period to recharge. 55% of non-owners were concerned by range and when coupled with worries over the number of public charge points (62%), it all sounds very doom and gloom.

But compare that with the perceptions of owners, where only 36% worry about running out of charge and 40% about the access to public charge points and it does start to sound more manageable. Generally, today’s EVs can cover a range between 150-300 miles and the latest Zapmap figures (April 2021) show there are more than 23k public charge devices at almost 15k locations in the UK.

Whether owners or not, respondents across all Acorn categories believe the biggest advantage of an EV is the reduced air pollution. And while cost of purchase is still a concern, it should be addressed as more EVs enter the market and second-hand vehicles become available. Knowing which benefits to promote and how to ease the concerns around perceived disadvantages is critical to delivering the right messages to the right audiences.

At CACI, we’re helping our clients to drive the electric revolution

Whether using an off-the-shelf customer segmentation like Acorn, a bespoke approach based on first party data alone or a hybrid solution combining elements of both, driving engagement from your audience will depend on your content and messaging. It’s clear that individual motivations for purchasing an EV will need to be exploited, while more importantly, concerns regarding owning one, will need to be addressed head-on.

It’s widely agreed that the purchase consideration period for an EV is substantially longer than for a new petrol or diesel model. So, it’s important to be able to identify which purchase phase an individual is in – awareness, consideration, purchase – to understand what information and content they’ll need to progress through what could be a longer journey than normal. To do that, CACI creates detailed contact strategies that allow brands to nurture their audiences until they’re ready to convert.

We worked closely with EDF Energy to identify which of their customers might already own or be likely to purchase an EV. By using CACI’s Acorn data and TGI profiles, overlaid onto their customer segments, we were able to design and deploy a series of highly targeted campaigns to upsell their EV tariffs.

More recently, our Data Science team have created a ‘propensity to buy EV’ model that has enabled Mazda to target the best audiences for their new all-electric MX-30. Through our Strategic Consulting and Campaign Engagement teams, we have delivered tailored campaigns and engaging content to the best audiences.

The innovative approach taken by CACI to launch our pivotal model, particularly the impressive use of data in forming the customer journey, has led to results that speak for themselves.

James Crouch, Customer Insight/Digital Transformation Manager, Mazda

Speak to us if you have any questions or want to learn more about our survey results.