Smart service

CUSTOMER Contact Centres are major cost centres, with some organisations taking up to 70 million calls a year with workforces of close to 10,000 people. Over the past three years strategies to cut costs have been implemented widely across the UK customer service industry. Savings on operating costs have been achieved but those tasked with implementing efficiencies recognise the majority of solutions deliver disappointing results and relatively small benefits.

Many organisations, focused on profit margin, have reduced customer service by limiting accessibility, introducing cheap sourcing, increasing self-service, deploying lean service principles which have encouraged customers to help other customers. But is it now the time to ask whether customer service protects a revenue stream or whether lean service programmes are in fact damaging long term revenue streams from customers?

Each contact centre has its own demand profile, and this uniqueness means that the causes of avoidable contacts are varied. Some will be hampered by complex products that create repeated questions, while others will have stronger online self-service which drives more complex calls to the contact centre. An emerging strategy which is being adopted by leading brands such as Amazon and ASOS is low cost, Smart Service.

Smart Service takes advantage of a range of process, cultural and technology developments that make monitoring and actively dealing with service issues easier. This is in tune with consumer demands (including the uptake of Smartphones, now owned by 50% of the population) and offers opportunities for organisations to re-engage with customers.

Ultimately this means that instead of waiting for customers to contact them, organisations are actively monitoring and tracking service issues and then contacting customers to put things right. There are lots of examples of Smart Service in practice, whether its real-time updates for changes to booked flights and train departures, or GPS location based services which give Smartphone users directions to restaurants or nearby good offers.

It could be car manufacturers monitor cars remotely to identify the correct time for servicing based on driving conditions, rather than a standard interval or banks using smart service by alerting customers about debits and credits on accounts. Technology companies monitor usage of broadband and advise customers about service disruption or use videos to help consumers set up a new PC.

The onus is on organisations to tune themselves into to consumers’ lifestyles, their attitudes to brands and use of enabling technologies. Today’s consumers want to deal with organisations that limit the time and energy required from them to complete purchases or service interactions. Recent research conducted by Davies Hickman Partners for BT Global Services and Avaya The Autonomous Customer found that 83% of online consumers agreed with the statement: “I buy more from companies that make it easier for me to do business with them.”

Consumers notice poor customer service too; over half of UK and US respondents said they knew about good service interactions because they have to provide it in their own jobs. Decision makers need to be aware we really do live in a service economy.

The research further identified that consumers are becoming less dependent on advice from organisations. More than three quarters of online consumers research their purchases online first, and 59% said that they preferred purchasing online because no one tries to sell you anything.

The ability of organisations to market themselves is being further challenged as consumers share opinions and turn to each other – half of respondents say they trust online forums more than an organisation’s website. For finance directors, this means traditional assumptions about customer retention are being severely challenged as consumers look for the best deal.

Customer service is an unavoidable aspect of dealing with people, it is inherent in a product, service or government policy on offer. It is inevitable when trying to meet disparate capabilities and behaviours of consumers today (no one can design perfect products and services that allow for every exception to the rule or a ‘Black Swan’ moment).

Consumers have any number of quite reasonable customer service issues, and these are not set to reduce as the pace of change in product and policy development continues to quicken. Organisations looking for good customer service measurements such as net promoter scores (NPS), or key performance indicators (KPIs) or more importantly, long term relationships with consumers who have fewer and fewer customer service issues – are turning to Smart Service.

Smart Service involves far more than just outbound text messaging, which has become associated with proactive service; it marks a fundamental shift from letting the consumer do the work in their own time, to identifying when something is not working. It uses data analytics and sensors in products and processes. Finance directors should start by asking can we get customer appreciation and value from using our existing tools and analytics?”

To build the confidence and trust of consumers, and retain their revenue in an increasingly connected world, it’s no longer about waiting for customers to contact an organisation – the initiative is switching.

Jo Davies is a former KPMG accountant and director at consumer research, marketing and service consultancy Davies Hickman