Significant new trends in customer service, sales and marketing.

MyCustomer.com
10

If you want to know the easy way to tell whether an article on the CRM-Forum is worth reading, there are two dead give-aways for articles that have been up for some time. Firstly, how often it’s been read, and secondly, how many comments members of the CRM-Forum have added to the article. Often these comments turn out to be more interesting than the original article.

A recent piece (Unhappy with the broadband hippies... ) by Stuart Lauchlan fairly rapidly attracted 9 comments (including one from me) and that encouraged me to re-visit it. It raised the issue of customer service for broadband connections to the Internet, and in particular, poor customer service from Freeserve. Rather than commenting on the CRM aspects of the issue, the responses from members were nearly all from a personal perspective, outlining their own experiences of broadband connections (6 bad, 3 good – incidentally all these good comments were for the same supplier, Telewest). What is interesting about this is how willing people are to share their experiences (bad and good), so they can learn from each other, perhaps particularly for complex, leading-edge products and services.

This week’s article from Stuart (Rotten to the core) re-emphasises the point. Stuart is sounding off about poor customer service he’s received from Apple. His article highlights another interesting, and increasingly common problem. More and more of the services that we consumers buy, are made up of a number of products and services from different suppliers. When the service breaks down, the consumer is often bounced from supplier to supplier, each one ‘confident’ his own piece of the service is working, and it’s someone else’s fault. Of course, each supplier wants to avoid the potentially high cost of solving the problem and so passes the buck elsewhere. This approach has to be wrong. Instead of treating this as a problem it surely could be treated as an opportunity.

Again, the comments provided by members add significant value:

- Firstly, a comment from T M Lutas (who doesn’t appear to work for Apple) provided Stuart with a solution to his problem. I don’t know if the solution worked, but it’s more than interesting that Stuart seems to be getting more support from members of the CRM-Forum in solving his Apple / BT / Alcatel problem than he got from any of the suppliers. The obvious question – what motivated T M Lutas to offer the helping hand?
- Secondly, both T M Lutas, and another contributor, David Bradshaw, suggested using knowledge bases and discussion forums to help solve such problems. Apple run a knowledgebase and discussion forum, and if they’re anything like the ones I use, although they are of course supported by the suppliers, frequently the most useful help comes from other customers. Again customers helping customers. David speaks more generally, saying: “We really need proper forums for sharing our customer experiences. There are some specialist forums, but I’ve yet to find anything as useful as www.epinions.com, but unfortunately this is specific to the US.”. Now there’s an interesting idea!
- Both David and Malcolm Wicks, another contributor, make the point that Stuart’s problem is really an opportunity. Malcolm suggests “Perhaps we really need is for one of the finger pointing suppliers to change sides and bat for the customers. In this case BT would be best. Imagine if BT said to Alcatel and Apple that unless they fixed the problem they would notify all users, and those who want to order broadband service, of the difficulty with those vendors’ devices… BT, the people’s champion!” David’s take is more hard nosed. “There really ought to be good business in providing superior customer service.”

So what’s my take on all this? I think these two articles and the comments on them highlight a number of developments that will have a significant impact on CRM and customer service in the future.

The world continues to get more and more complicated, with more and more sophisticated products and services being offered to us. These are frequently made up of key components from a variety of suppliers. As long as those products and services are relatively unstably integrated, there are really only two ways that satisfactory customer service can be offered to the consumer:
- Either one company takes ‘prime contractor’ role and sells and supports the complete bundle, or
- Companies learn to ‘federate’ to offer a single solution to the consumer. In this case, I suspect, along with Malcolm, that one of the suppliers may have to change sides, and ‘bat for the consumer’. That supplier would be the obvious port of call for customer services. Along with David, I agree that ‘there really ought to be good business in providing superior customer service.’

There are also very interesting developments going on amongst consumers. In this world of complex products and services, with all sorts of complex interactions amongst themselves and others, it seems clear that consumers are often better providers of support than the suppliers. Let me use myself as an example. As a bit of a techno-nerd myself, in the last year I’ve got interested in three different bits of relatively new technology: DVD+RW, Home Cinema, and semi-professional quality digital photography.

How have I gone about deciding what to buy, and get at first line support? Well, whereas before I might have relied on a local dealer + brand, or a copy of a consumer magazine such as Which, in each case I’ve used a different approach:
- Search the Internet for a discussion group / forum (preferably supplier-independent) on the topic.
- Check that the discussion group / forum covers both an understanding of the technology and requirements, and also has an active ‘support’ discussion group.
- Use it to get an understanding of the technology, my requirements, and recommended solutions for my specific requirements.
- Buy the goods from the supplier
- Use the discussion group / forum as first port of call for customer support, and for evidence to beat up the supplier if necessary.
- Become a contributor to the discussion group.

This process goes on through the life of the product, so that I still frequently use the Dell and Sony discussion groups / forums for support of my PCs.

It seems that more and more consumers are beginning to work this way, and it is a small part of what we are calling the shift to a buyer-centric world. The implications for the future of CRM and hence CRM professionals should be obvious. Buyers, to take control, are using the technology of CRM. Sales, marketing, and customer service are moving from ‘push’ processes (from the suppliers to the customers) to ‘pull’ processes (from the customers to the suppliers), and how much better it will be when we have taken control!!!

As always we’d like to hear your comments. Make them below or email me at mailto:[email protected]

Regards,

Richard Forsyth

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avatar
03rd Feb 2003 18:22

Richard,

I couldn’t agree more with David and Malcolm Wicks that Stuart’s problem of poor customer service is really an opportunity. We have the figures to prove it.

'Profit or Pain from Your User Experience’ reports our findings from the most extensive and in-depth research of online users ever conducted including:

• 10,000 in-depth ‘eMysteryShopper’ surveys of UK web sites
• 500,000 consumer opinion surveys on UK retail and travel sites
• quotations and findings from a global panel of 1750 Internet users
• 3.7 million customer service requests via the web to over 200 US businesses using RightNow Technologies

We found that by improving the end-to-end user experience, a typical business can increase online sales by 64% and cut up to 70% of the direct cost to serve in the contact centre.

You may ask why the ROI from improved user experience is so high? We found five reasons why:

1 Online sites are leaking customers at every point in the buying cycle. A significant proportion of visitors want to buy online but are finding it just too difficult or time consuming. Bear in mind too the phenomenon recently identified by several contact centres that customers who call in typically want to buy.

2 Online shoppers are stickier than their offline equivalents. Most online shoppers prefer to stick with a small number of tried and trusted sites. 90% of online shoppers buy regularly from five or less sites. However, they spend a lot on the few sites they use. The more online customers spend, the stickier they appear to be.

3 Most companies have yet to reap the benefits from adopting leading-edge eService technologies. Those few companies who have adopted leading-edge eService technologies have managed to reduce their contact centre’s service costs by anything up to 70%, whilst increasing their online sales by 4% to 15%.

4 Contact centres are still typically disconnected from sites. there is almost no co-ordination between the many functions involved in online sales and the supporting contact centre with a view to systematically improving eService and driving demand from the contact centre to the web. Few companies are seizing the opportunity to use the contact centre as “the eyes and ears of the business”.

5 The general understanding of web usability and what constitutes a good end-to-end user experience is still in its infancy and there is not yet a recognised body of knowledge in this field.

The report was written by DigitalResearch.com, Landmark Consulting and myself at Hewson Group. I’m excited and proud to have been part of the team that have managed to quantify the impact of good service and anticipate that these figures will convince even the most skeptical cost-cutting FD that customer service is not philanthropy but sound busness sense

Wendy Hewson www.hewson.co.uk

Thanks (0)
avatar
04th Feb 2003 08:09

Your editorial on the CRM Forum News rec'd today hit a few important nails on the head for me. But, while the deliverables on the part of many service organizations often leave a lot to be desired, so too are the expectations of the people they serve: all over the map. It may well not just be a case
of 'What more can we do for the customer', but also 'What more can the customer do for both of us?' Relationships - by their nature -simply have to be shared!

We run a frequency based Rewards programme for a major book retailer here in South Africa with all the elements of CRM built-in. The project has over 250 000 members, delivers Rewards to active members that represent some 60% of the company's total sales value each quarter, and we go out of our way to make all communications personal and relevant to the people for whom they are intended.

We also run the call centre that both facilitates and manages the communication interface with the members, and the results of all of that are placed in the hands of the store personnel via a real-time web-interface to the database. Having said all of that, we get a variety of attitudes from customers that range from 'Thanks for your wonderful service', to 'I'll never deal with you again!. The reason: different people and their different perceptions!

Thanks (0)
avatar
04th Feb 2003 11:29

I agree with Richard's point about an increase in customer power. Early adopters particularly have a range of ways to check out products pre and post purchase and make things happen. The availability of tools to help customer power will increase but they will not be suitable for all. Some customer are too busy and not technology aware.

We get more confirmation from the Hewson document that it makes business sense to look after customers whilst continuing to hear stories of bad service. Maybe is all boils down to the size of the "r" in CRM. For some companies its a capital letter and for others it's in a much smaller font than the other two letters. They are more interested in Customer..Management. For some companies this makes busines sense particularly if customers are willing to do more for themselves.

Back to Richard's main point. Those customers who are not early adopters should seek out suppliers that have their "R" in a big font. Suppliers who serve this market will understand that one of the key concerns for their customers is how easy is it to do business with them. In many cases customers will even accept a price premium for dealing with a big R company.


Malcolm Wicks
Three Step Consulting
www.3sc.co.uk


Thanks (0)
avatar
03rd Feb 2003 17:25

It is strange to see an industry come full circle. CRM started off as SFA and Support ( for Customer support centers) and grew from there to marketing etc... I have always been a sucker for customer service and continued to believe that Good, no, Great!! customer service would pay for itself in additional sales and market share. When CRM went awal and down the marketing route I was sad to see CRM starting to concentrate on selling and winning customers in stead of keeping customers. I have no problem with marketing it is a very real tool and should be incorporated in with any CRM solution. What I felt was wrong was the emphasis on Marketing in a CRM environment. This I could not believe was the main reson for impelmenting CRM. I thought it was customer satisfaction and retention and not marketing. Well looks like the customers are pusshing CRM back to were, I believe, it should be. Giving customers the support and service they deserve for buying a product. Being a customer champion does pay in the long run.....

Thanks (0)
avatar
03rd Feb 2003 23:38

Richard, Wendy

We can all recount many horror stories about appalling customer service. My own favourite is courtesy of the Marriot Hotel in Frankfurt and started with the unforgettable line from a member of staff who knocked on my door just after I had checked in; “I’ve come to take away your VIP gifts!”. Enough said.

But the bigger question is whether a customer-orientation really makes business sense.

“Hell, YES, it makes sense”, is the obvious answer when you look at the results from surveys like Wendy’s. Customers obviously have a legitimate right to expect support when they have difficulty using a company’s products. It makes good business sense. Indeed, if you look at the JD Power surveys of customer satisfaction, elements of the post-sale customer experience account for the lion’s share. Many companies have not really got to grips with this idea yet; that it is how you support customers during the consumption part of the customer experience that really drives satisfaction, repurchase behaviour and profitability.

But “Hell NO it doesn’t make sense”, is the obvious answer if customer service is just another badly run cost centre. Indeed, recent research suggests that companies with a selling or national brand-orientation may actually outperform those that have customer-orientation. The answer is obviously more complicated than meets the eye.

Why do so many companies get it so wrong?

Research shows that customers recognise dozens, if not hundreds of different touchpoints with a company over the lifetime of a product. But at a particular stage of product use, or their relationship with the company, only a few of these touchpoints really matter to the customer. All the other touchpoints don’t, providing they are above a certain minimum threshold. And these may differ over time as customers gain experience with a company and its products, and as other companies introduce better touchpoints..

But how many companies know how many touchpoints customers have with them, their products (or their partners) on a typical day? And how many know which touchpoints are really critical to customers? And how many know how these differ by segment or over time? And how many are even interested to find out and act on this insight?

I think you see why so much customer service gets 3/10 on my scorecard.

Graham Hill
Independent CRM Consultant.

Thanks (0)
avatar
04th Feb 2003 08:09

Your editorial on the CRM Forum News rec'd today hit a few important nails on the head for me. But, while the deliverables on the part of many service organizations often leave a lot to be desired, so too are the expectations of the people they serve: all over the map. It may well not just be a case
of 'What more can we do for the customer', but also 'What more can the customer do for both of us?' Relationships - by their nature -simply have to be shared!

We run a frequency based Rewards programme for a major book retailer here in South Africa with all the elements of CRM built-in. The project has over 250 000 members, delivers Rewards to active members that represent some 60% of the company's total sales value each quarter, and we go out of our way to make all communications personal and relevant to the people for whom they are intended.

We also run the call centre that both facilitates and manages the communication interface with the members, and the results of all of that are placed in the hands of the store personnel via a real-time web-interface to the database. Having said all of that, we get a variety of attitudes from customers that range from 'Thanks for your wonderful service', to 'I'll never deal with you again!. The reason: different people and their different perceptions!

Thanks (0)
avatar
03rd Feb 2003 17:25

It is strange to see an industry come full circle. CRM started off as SFA and Support ( for Customer support centers) and grew from there to marketing etc... I have always been a sucker for customer service and continued to believe that Good, no, Great!! customer service would pay for itself in additional sales and market share. When CRM went awal and down the marketing route I was sad to see CRM starting to concentrate on selling and winning customers in stead of keeping customers. I have no problem with marketing it is a very real tool and should be incorporated in with any CRM solution. What I felt was wrong was the emphasis on Marketing in a CRM environment. This I could not believe was the main reson for impelmenting CRM. I thought it was customer satisfaction and retention and not marketing. Well looks like the customers are pusshing CRM back to were, I believe, it should be. Giving customers the support and service they deserve for buying a product. Being a customer champion does pay in the long run.....

Thanks (0)
avatar
04th Feb 2003 11:29

I agree with Richard's point about an increase in customer power. Early adopters particularly have a range of ways to check out products pre and post purchase and make things happen. The availability of tools to help customer power will increase but they will not be suitable for all. Some customer are too busy and not technology aware.

We get more confirmation from the Hewson document that it makes business sense to look after customers whilst continuing to hear stories of bad service. Maybe is all boils down to the size of the "r" in CRM. For some companies its a capital letter and for others it's in a much smaller font than the other two letters. They are more interested in Customer..Management. For some companies this makes busines sense particularly if customers are willing to do more for themselves.

Back to Richard's main point. Those customers who are not early adopters should seek out suppliers that have their "R" in a big font. Suppliers who serve this market will understand that one of the key concerns for their customers is how easy is it to do business with them. In many cases customers will even accept a price premium for dealing with a big R company.


Malcolm Wicks
Three Step Consulting
www.3sc.co.uk


Thanks (0)
avatar
03rd Feb 2003 18:22

Richard,

I couldn’t agree more with David and Malcolm Wicks that Stuart’s problem of poor customer service is really an opportunity. We have the figures to prove it.

'Profit or Pain from Your User Experience’ reports our findings from the most extensive and in-depth research of online users ever conducted including:

• 10,000 in-depth ‘eMysteryShopper’ surveys of UK web sites
• 500,000 consumer opinion surveys on UK retail and travel sites
• quotations and findings from a global panel of 1750 Internet users
• 3.7 million customer service requests via the web to over 200 US businesses using RightNow Technologies

We found that by improving the end-to-end user experience, a typical business can increase online sales by 64% and cut up to 70% of the direct cost to serve in the contact centre.

You may ask why the ROI from improved user experience is so high? We found five reasons why:

1 Online sites are leaking customers at every point in the buying cycle. A significant proportion of visitors want to buy online but are finding it just too difficult or time consuming. Bear in mind too the phenomenon recently identified by several contact centres that customers who call in typically want to buy.

2 Online shoppers are stickier than their offline equivalents. Most online shoppers prefer to stick with a small number of tried and trusted sites. 90% of online shoppers buy regularly from five or less sites. However, they spend a lot on the few sites they use. The more online customers spend, the stickier they appear to be.

3 Most companies have yet to reap the benefits from adopting leading-edge eService technologies. Those few companies who have adopted leading-edge eService technologies have managed to reduce their contact centre’s service costs by anything up to 70%, whilst increasing their online sales by 4% to 15%.

4 Contact centres are still typically disconnected from sites. there is almost no co-ordination between the many functions involved in online sales and the supporting contact centre with a view to systematically improving eService and driving demand from the contact centre to the web. Few companies are seizing the opportunity to use the contact centre as “the eyes and ears of the business”.

5 The general understanding of web usability and what constitutes a good end-to-end user experience is still in its infancy and there is not yet a recognised body of knowledge in this field.

The report was written by DigitalResearch.com, Landmark Consulting and myself at Hewson Group. I’m excited and proud to have been part of the team that have managed to quantify the impact of good service and anticipate that these figures will convince even the most skeptical cost-cutting FD that customer service is not philanthropy but sound busness sense

Wendy Hewson www.hewson.co.uk

Thanks (0)
avatar
03rd Feb 2003 23:38

Richard, Wendy

We can all recount many horror stories about appalling customer service. My own favourite is courtesy of the Marriot Hotel in Frankfurt and started with the unforgettable line from a member of staff who knocked on my door just after I had checked in; “I’ve come to take away your VIP gifts!”. Enough said.

But the bigger question is whether a customer-orientation really makes business sense.

“Hell, YES, it makes sense”, is the obvious answer when you look at the results from surveys like Wendy’s. Customers obviously have a legitimate right to expect support when they have difficulty using a company’s products. It makes good business sense. Indeed, if you look at the JD Power surveys of customer satisfaction, elements of the post-sale customer experience account for the lion’s share. Many companies have not really got to grips with this idea yet; that it is how you support customers during the consumption part of the customer experience that really drives satisfaction, repurchase behaviour and profitability.

But “Hell NO it doesn’t make sense”, is the obvious answer if customer service is just another badly run cost centre. Indeed, recent research suggests that companies with a selling or national brand-orientation may actually outperform those that have customer-orientation. The answer is obviously more complicated than meets the eye.

Why do so many companies get it so wrong?

Research shows that customers recognise dozens, if not hundreds of different touchpoints with a company over the lifetime of a product. But at a particular stage of product use, or their relationship with the company, only a few of these touchpoints really matter to the customer. All the other touchpoints don’t, providing they are above a certain minimum threshold. And these may differ over time as customers gain experience with a company and its products, and as other companies introduce better touchpoints..

But how many companies know how many touchpoints customers have with them, their products (or their partners) on a typical day? And how many know which touchpoints are really critical to customers? And how many know how these differ by segment or over time? And how many are even interested to find out and act on this insight?

I think you see why so much customer service gets 3/10 on my scorecard.

Graham Hill
Independent CRM Consultant.

Thanks (0)