As customers we demand a good service from any organisation that we come into contact with. If we don’t receive it, we’re more likely than ever to share our frustrations with our increasingly connected peers. This will over time, define the organisation in the minds of its customers or in the case of public sector organisations, its citizens.
Of course ‘good customer service’ is just a helpful label that can mask a myriad of complex interactions – from the first contact with a customer through to an after sales issue resolution and everything in between. Given this complexity, delivering a consistently good experience will always be challenging so how do some organisations manage to make this look effortless while others struggle to keep pace with their customers’ expectations?
Vertex recently commissioned an Ipsos MORI research study to find out why this gap exists. We asked consumers to share their experiences of contacting organisations across a range of different sectors and to highlight the issues that they were witnessing. The research confirmed a fragmented picture with the discovery that some organisations are outpacing their peers. In fact, a majority of consumers told us that they find the high street retail environment delivers better customer service than any other sector including its online cousin with 68% claiming it to be ‘fairly good’ or ‘very good’. This is in sharp contrast to Central Government agencies, which are rated ‘fairly good’ or ‘very good’ by only 28% of respondents.
What makes retailers so good at customer service? In our view one of the biggest differentiators between retailers and other sectors is the way in which they embrace the insights that good customer data can provide.
Take online shopping where customers often receive tailored reminders about products or services they might have forgotten to add to their baskets on each visit. This approach – facilitating better experience - is now being adopted elsewhere. We are all used to airlines offering travel insurance when flights are booked or music stores making recommendations based on past purchases. When this kind of customer engagement is delivered in an appropriate way it is seamless, helpful and customer loyalty is increased.
Smart use of customer data can go further still. If, for example, an insurance company knows that a customer has both household and car insurance through them, they are better placed to price the risk of insuring a second car whilst better understanding the customer’s value to the company and the potential for cross or upsell of other products and services. It is also easier to intervene around renewal dates, lock in loyalty and of course save money along the way.
This data-centric approach has significant appeal but it is not without its challenges. Firstly there are the obvious technical questions – can we deploy the appropriate infrastructure, are our people skilled to use this information and what underlying technologies are needed to capture and then deliver the analysis? Typically, businesses focus time and resources around these critical infrastructure hurdles and build solid, reliable IT platforms. But to leap to a technology-led solution without first considering the wider customer engagement requirements would be to overlook one of the most fundamental pieces of the jigsaw – the end beneficiary.
These ‘softer’ challenges require a different set of skills and a fundamentally new way of examining the way in which organisations interact with their customers. The key questions that must be posed here are: how can we engage with our customers in a way that improves their experience whilst delivering greater efficiencies and improved loyalty and acquisition whilst reassuring them our use of data is appropriate? Beyond this it asks businesses to scrutinise how ready willing and able it is to learn from and respond to the insights this data yields.
These are significant challenges. If an organisation builds its business around data it will quickly amass significant quantities of information. If it misuses this – intentionally or by accident - for example by calling a customer to try and sell them a service when they’ve specifically asked to be contacted via email rather than over the phone - customers will quickly lose confidence. Of course some organisations handle much more sensitive data than others and here the potential risks are magnified. In every situation organisations must choose where to ringfence data that will never be shared, even internally, and how to appropriately convey this policy to its customers.
Our research brought this challenge into stark relief. While we found retailers and financial services companies are seen as the most trustworthy when it comes to protecting personal information, significant concerns remains with around a third still claiming they are ‘untrustworthy’. This lack of trust rises to an incredible 55% for Central Government agencies.
So how can organisations gain customers trust so that they open up the channels of communication and offer the company their personal data? The key is being transparent in explaining why you are collecting information, what you plan to use it for and the benefit it will bring the customer. Organisations need to demonstrate that the customer will benefit through closer collaboration by offering special deals or more targeting marketing and promotional offers.
Improving customer insight data doesn’t necessarily mean companies capturing more data. The first step is to analyse and then use the data already held and in our experience this can be as straightforward as overlaying an organisation’s existing interactions with the customer to build a more accurate picture of their requirements.
Greater insight can also be generated by leveraging new technology - an excellent example of which is speech analytics. By analysing the specific words used and their frequency on a customer call it is possible to identify the reasons why a customer called. As a result, organisations have the chance to address the underlying root causes and make the overall customer experience both more pleasurable and more cost effective.
As the quality and visibility of data improves organisations can begin to build a single view of the customer. Then, with all the information about each customer in one place, they can start to offer more joined-up service and tailored offers that improve the experience to customers and the capability for the business.