Overview

Customer sense

Read time 11min 10sec

Ask anyone how much they enjoy phoning a contact centre, and their next move may be a swat in your direction. Ask them how that drawn-out issue with a service provider is going, and you may have to listen to a half-hour-long rant. On your social media accounts, you don't even have to ask - customer gripes arrive all on their own.

Complaining about wretched customer service is nothing new. What is new is the amount of freedom and power customers wield to make unnecessary pain go away. They can move to other providers, armed with the recommendations of experts and friends available online and on social media platforms. Increasingly, they do just that, without bothering to understand which bits of your company's customer relationship management (CRM) need fixing. They also tend to tell everyone they know, in more ways than ever before.

Customer is king

Taking customers' dread or delight into account is called customer experience management (CEM), by those who focus on customers rather than technology only. Retaining this generation of customers, as well as the next that play with smartphones before they can talk, will depend on it.

Most people thrill to something customised specifically for their tastes, offered just to them, when they're likely to want it. Few brands manage that, though.

"The only brand that comes to my mind, one truly compelling, is my Apple store experience," says Pieter de Villiers, Californian CEO of Clickatell, a mobile messaging provider to global companies and South African retail banks.

"I can book an appointment in advance. When I arrive, someone is there to meet me, and serve me if I have a query. When I buy something on impulse, I don't have to go to a point of sale: there are people standing around with remote payment terminals so I can pay any of the guys wearing blue shirts. They ask if I want a paper or e-mail receipt, so I can be out of there without waiting for a piece of paper.

"It's a vibrant environment; it's pleasant to be there. People leave you alone if you want to be left alone, and help you when you want it. We always look at the technology of companies like Apple. We should look at Apple's customer experience as well, not just on the device, but also in the store. I don't get spammed by Apple, though they've got more detail about my Apple products and my usage than anyone. But they don't try to abuse that by pushing things down my throat."

I don't get spammed by Apple, though they've got more detail about my Apple products and my usage than anyone.

Pieter de Villiers, Clickatell

Getting customer experience right when all goes well is tricky enough. When things go wrong, it can be far more difficult. Here Virgin Airways sweeps to mind as a first-class customer care business for Keith Fenner, VP of sales at Softline-Accpac, a CRM solution provider.

"If you phone SAA or British Airways, you will have to press 30 different buttons on your phone, followed by speaking to an operator after you've put in your frequent flyer number, and then they'll still ask you what that number is.

"But I can guarantee you if I phone Virgin, and put in my gold card number, the person will answer within three rings, and the first thing she'll say is, 'Hello Mr Fenner, I understand you're flying to London with us next week. Is that your reason for the call?'"

"They've obviously got a CRM system that's reading the customer database, which sees that I'm a frequent flyer customer, and what my flight status is. I've also phoned the day I landed, and the script changed to say, 'Mr Fenner, you landed from London yesterday. Are you phoning because there was a problem with your flight that we could help you with?'"

But in general, Fenner would rather not phone. "We need to understand how our customer wants to transact with us. I never want to phone a call centre, because generally you're frustrated. If the call centre is not operating properly because the right information is not available at the right time, then you can never move to what you should be moving to, which is an online strategy, where people can interact in their own time on their own device over the Internet.

"Worse, if the interaction is not working in the call centre, you can't expose it to the outside world. That is why we see a very slow uptake of portal environments that customers can log into, because the back-end isn't working yet."

Customers do not need to know much about back-end problems to realise that something is awry in their experience. Not being understood, combined with non-customer-focused metrics, rub many up entirely the wrong way.

The difference between customer dread and delight lies in the company's approach to interaction - mainly technology-driven, or mainly customer-driven.

"Most CRM practitioners have traditionally assumed an internal (inside-out), operationally-centric approach to customer management and strategy," said Mike Myatt in a 2007 book quoted online by analyst Leigh Durst.

"Customer experience management practitioners distinguish themselves by assuming an 'outside-in', or highly customer-centric, work approach," Myatt said.

Customer demands

If companies are confused about the strategic difference between CRM and CEM approaches, customers already know which one they prefer, and are getting more adamant about it.

"We live in the age of the customer," says Patricia Martins, head of Microsoft Dynamics SA, a CRM solution provider.

Without an adequate focus on customer experience management, your organisation will find it difficult to meet its business goals.

Ed Thompson, Gartner

As recently as 1990 to 2010 was the age of information, she says. "Where we are now, the customer is not as loyal, because they have big demands and they have choice. Technology plays a huge role in this. Companies today are compelled to become obsessed with customers. It's no longer about focusing on competition, but on customers."

How much can CRM learn from a mature industry that's been focusing on customers for a very long time, like hospitality? Lots, it transpires.

"Customers must have the flexibility that if they want to interact with a hotel or any other company, they don't have to place a phone call, which costs them time and money, to engage with that company," continues Martins. "They want choice, where they can go via the Internet and make a booking.

“More importantly, today, most customers are interacting via social media, so they should be able to book into a hotel via that medium. There are different aspects within a company's customer relationship management. It's not about the tools, but rather about the solution. It's very much about the strategy. Defining the right business process is important.

"So coming back to the hospitality example, what happens when a customer wants to book a hotel room? What other things do we want to achieve when that customer calls or comes in via the Web or social media? What business processes do we need to put in place? Do we want to make sure the customer service is excellent? Do we also want to up-sell? That and loyalty programmes aid customer experience."

Turning lead into gold

Turning customer experience from dodgy to first-class takes some doing, way beyond removing inefficiencies in the contact centre back-end. Simply updating antiquated marketing systems, which assume one-way communication from large companies towards the customer, is not sufficient either.

Ed Thompson, a Gartner CEM and CRM analyst, describes how to recognise how dodgy a customer experience your company provides, in the November 2011 Gartner Customer Experience Management Maturity Model.

Some companies are not on a customer experience management scale yet, he says.

"Although there may be business problems relating to poor customer experiences, no one is articulating the need for change. In a few cases, this is a deliberate executive strategic decision, particularly in commodity or low-cost businesses."

Customers fare little better in the first of five CEM maturity stages Thompson describes. He calls this first stage 'initial - fragmented focus'.

"Processes are ad hoc, disconnected and disorganised. There may be multiple individual advocates, but they have little awareness of each other, no formal strategy is in place, and there is limited acceptance of the importance of CEM maturity across the organisation. Although individuals recognise the need for CEM, the senior executives of the organisation do not recognise the prevalence of the issue."

Once a company gets to the second stage, 'developing - voice of the customer validated', the company is trying, but the customers may well be frustrated with being the passed-around buck.

Now, says Thompson, "various groups in the organisation have recognised the need to take action regarding CEM, so they engage in isolated, bottom-up initiatives. However, there's no high-level business sponsorship or major investment, so the effect is trying to solve the worst customer experience problems reactively.

"As attempts are made to address problems in one department, it becomes obvious that a more holistic, cross-departmental approach is necessary, because the customer does not care which department is responsible and seeks a joined-up response."

Executive in

Once senior management has jumped into the fray, the third stage, 'defined - executives engaged', is reached. Here, the customer experiences the organisation acting like one with personalised interactions. Demonstrating respect for data privacy may even improve customer trust at this point.

To reach this stage, senior management outlined a vision and processes have been standardised. Constituents are aware of each other, 'effectively creating a less-siloed form of CEM for a broad audience'.

At the fourth stage, 'managed - profit parity', executives consider a customer experience metric as important as profitability. And all the other employees also focus on that metric as much as they do on profit, says Thompson.

Here, "previously fragmented silo-level CEM approaches are brought together to form an enterprise-wide strategy".

If the customer is lucky enough to deal with an organisation at stage five, 'optimising - culture change', he would probably recognise this rarity quickly.

At this stage, says Thompson, "the culture of the organisation has changed, so that employees do the right thing without being asked, given incentives or pressured. Employees are empowered to take action and innovate.

"A culture of 'alert defence' of an excellent customer experience has taken hold. A shared, accurate, timely and complete view of the customer, including all forms of customer feedback, is available to all employees, regardless of the channel from which the customer starts an interaction."

It may gladden the heart of many a customer that Thompson cuts technology down to size in the CEM model he describes.

"Technology investment is only used on 20% of customer experience projects, though it is rising rapidly. Successful CEM needs a holistic, business-driven approach that includes a strong focus on strategy, leadership, metrics, governance, organisation and process, as well as technology to support it in some cases."

Analysing social media along with other customer input is a valid approach, can help to turn otherwise incendiary tweets and Facebook comments into good marketing, but is limited, as is any other technology.

Cautions Thompson as co-author: "By year-end 2012, only half of Fortune 1 000 companies will receive ROI from their social CRM initiatives. And by year-end 2012, more than 50% of 'greenfield' social commerce initiatives will fail to drive sales beyond what had been obtained from existing e-commerce activities," in Gartner's November 2011 analysis, Predicts 2012: Social CRM Remains an Immature Area.

Freedom of choice

In the past 10 years, companies have been getting more interested in CEM initiatives, says Thompson. One key reason is 'fewer forms of sustainable business differentiation'.

Continues Thompson: "Without an adequate focus on CEM, your organisation will find it difficult to meet its business goals, either through the leaky bucket of low customer retention, requiring an increased pressure and cost of acquiring more customers, or due to low levels of advocacy, requiring higher levels of marketing spend due to limited word-of-mouth support."

Customers know what they want, and increasingly, are telling each other where and how to get it. They have more ways of voicing dread or delight than ever before, to more people than they could ever tell over tea or beer. They're getting better at finding better choices. And a better choice is increasingly the company that's easy to do business with.

Companies are equally free to choose to focus on customer experience as business strategy.

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