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Brands reward repeat shoppers for being customer service agents

March 31, 2016 03:30 PM
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Golfers love to talk golf, and manufacturer TaylorMade Golf is employing customers who use its products as sales agents. 

The advocates are customers and prolific social media fans that e-commerce advocate vendor Needle Inc. identifies, vets and incentivizes to interact with the brands’ shoppers. Compensation for these advocates is based on the number of customers each advocate interacts with each week as well as their customer ratings and other factors. 

Needle assesses potential chatters for their length of loyalty, grammar and typing skills and ability to interact in trial chats, says Needle CEO Morgan Lynch. 

The retailers pay a monthly subscription license fee for Needle’s Advocate Marketing Cloud, which starts at $4,000 a month and varies based on factors like website traffic. The fee covers all of Needle’s services, including software and recruiting and certifying the advocates. 

TaylorMade, a golf equipment and apparel manufacturer that is owned by adidas America Inc., No. 246 in the Internet Retailer 2015 Top 500 Guide, started using Needle about two years ago to enlist its most loyal customers as advocates by looking at online forums, social media and TaylorMade’s frequent shopper lists. 

The company initially had qualms about using people who are not employees to do this work, says John Gonsalves, vice president of TaylorMade’s direct-to-consumer business. “The idea of letting the grip go a little bit on the brand was uncomfortable at first, but we’ve learned to embrace it,” he says. “We learned the people who are passionate about your brand love golf, learn to play golf and love the products they play with. That’s the root of it for us.”

TaylorMade has engaged 18 to 30 online advocates, with six or so active at any given time, Gonsalves says. And they’re producing results. The conversion rate for shoppers who chat with an online advocate is 3.5 times greater than those who don’t chat, and these shoppers spend more money—the average order value is 50% greater than non-chatters.  

That’s significant because up to 75% of chat-based revenue is incremental, meaning the retailer wouldn’t have otherwise gotten the order, Gonsalves says. He says chats have also led to a lift in sales at the retailer’s stores, although he declines to provide details. 

Advocates get compensated in a variety of ways, Lynch says. Most advocates for TaylorMade opt to get golf products. They can also earn cash, points to redeem for TaylorMade products and get invited to play on a golf course near the company’s headquarters in Carlsbad, Calif. 

Gonsalves wouldn’t give specifics about the return on its investment in Needle’s services. But he says TaylorMade benefits from letting Needle handle the staffing of chat agents during both peak and off-peak sales seasons and from getting insights from advocates who’ve used the golf equipment and share a love of the game. TaylorMade’s direct-to-consumer e-commerce business accounts for low- to mid-single digits of the company’s $1 billion in yearly revenues worldwide, he says.

 

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