Service Evasion

There’s good news and there’s bad news. The good news, which is for consumers, is that there is now an online, private customer redressal system that takes complaints of customers and solves them by escalating it to higher echelons of customer service in a company. All the grieving customer needs to do is to type in their complaint in a text box on the online consumer forum and the complaint is formalized and sent to people who can make a decision in the company (not to the poor customer-service representative whose minimal powers range from “I will try to help you” to “Sorry, I cannot help you in this matter”). The matter is then solved doubly quick, resulting in a happy customer who still curses the poor service from the company but posts an effusive testimonial on the forum website stating the turnaround time of complaint resolution and money saved. If you want to follow the complaint closely or step-by-step, you would have to pay for it, but paltry in comparison with the amounts you would incur if you did it on your own.

Sounds great and it is in fact a boon for consumers. But what does this mean to the organizations who are the actual custodians of the experiences of their customers? Isn’t the care of their customers solely their responsibility?  The success of such a forum goes to show that companies are seemingly indifferent about customer service. At least when it comes to making sure that a service issue is resolved. They seem to have the first level of redressal in place but are not able to go the extra mile in making sure that the customer gets the required resolution. Frustrated by this lack of commitment to a tangible end, the customer turns to the online redressal forum. It surely doesn’t look good for an organization when its poor service is blatantly highlighted online and someone else credited for resolving a customer problem that they obviously haven’t been able to.

An organization’s responsibility towards their customers doesn’t end at just creating an ecosystem to sell the product; it also extends to creating a post sales relationship. Today’s service providers are pushing the envelope in terms of reach and network of customers, therefore creating an environment to service those same customers must fall under the same ambit. So can we assume our service providers are giving up? Or are we just looking at a shifting focus from treating customer service as an extension of the product, to just plain and simple resolution?

The expectation dry-up?

We have been mentioning that the moment of truth is the point where a brand is made or broken. This is where either a satisfied customer glorifies the product/service or an unhappy customer dismisses it. We know for a fact that most of the time the customer is left dissatisfied. We lay the onus on the service provider and complain that service levels have to improve – and then there’s lethargy. But then there is the Indian consumer who is so used to poor service that she is almost immune to it! In the comparison between expectation and delivery, we can see that since the expectations are so low, it’s no surprise that delivery levels are so poor.

This could probably be attributed to years and years of poor service, long queues and red tape that has adversely conditioned the Indian consumer psyche. It is sometimes due to this mindset, that when something out of the ordinary is provided, the Indian customer is overawed. For example, an Indian consumer is easily thrilled when a DTH service provider promises service in 24 hours and it actually happens! But isn't this what the company has always promised?

So let’s sum it up. It would seem that as an ecosystem we are already meeting expectations and with the considerably low levels these expectations are surviving at, we are headed towards an era of customer indifference. Or we quite possibly are already there. Practitioners have been talking about great customer service for years now but service providers continue to ignore the calls, yet they preach about the Zappos of the world without ever intending to change a single process internally. Customer indifference could soon lead to a drying up of differentiators or marketing ‘hooks’. We would then go back to a market that differentiates on factors like price and product design that we know are unsustainable.

Looks like soon, that DTH customer we spoke about is going to become an exception to a rule no one cares for. 

Customer for life?

This article featured in the Hindu Business Line dated 14th September 2012.

As I have often said, I spent six years of my life counting other people’s cash and writing other people’s fixed deposit receipts. Even after leaving the banking industry, I still talk about it as I am still a customer of one bank or the other.

Today, I am not merely a customer but someone who perhaps knows a little more about customers than when I was a callow youth in the banking counter hoping for a typhoon or a flood on Saturday morning so that I could leave in time to catch a movie rather than be flooded by customers! One of the first things I have since realised is something called “lifetime value of the customer”, which I knew nothing about or cared even less for in 1973 when I first started working with Grindlays Bank.

LIFETIME VALUE

This is one of the most frequently quoted phrases that marketing people spout. Very simply, this term denotes the profits an organisation makes from dealing with a customer over a period in time. So, if you are my company’s customer for twenty years (bless you) then the profits we make from servicing you over that period add up to this number and clearly you have tremendous value to me and my organisation. Now I teach management students and they bank with one nationalised bank or the other because of convenience. They rarely ever have money, live hand to mouth and often have difficulty in meeting the minimum balance even. Soon they graduate, get jobs and grow in more ways than one.

In some time they become “high net-worth” individuals and every international and private sector bank woos my former students actively (and without a second thought, they switch camps and banks). So what has happened here? Here was a customer well within the fold of a nationalised bank and that bank messed up because it really did nothing to retain them.

Now is this unique only to nationalised banks? I am not sure as it happens too often in my own company. I am sure it may be happening (sadly) in your company as well even if you may not be forthcoming in accepting it as I have been.

ACQUISITION OR RETENTION?

Let’s understand why this happens. The reason is obvious. Companies are busy acquiring new customers. This is where the rewards and recognition are. Your bosses write to you. Your colleagues envy you and your career invariably moves north. And yet some questions are in order. Are we spending more time looking at new business and clients at the cost of our existing customers? Is our output better for prospects than for existing clients?

The constant gripe of clients in the advertising business is that their agencies churn out better work in creative pitches than they do for their existing clients and I can vouch for this – that agencies seem to be pumped about pitches but seem flat when it comes to ‘demanding’ current clients. I do hope that this is not the situation in your company.

It is worthwhile to remember that it is a lot more profitable to hold on to existing clients than spending on attempts at new business acquisition. This is not to diminish the value and importance of new business acquisition as growth is what we are looking for.

The smarter companies ensure they don’t jeopardise the service offered to their existing clients when they prospect for new clients. They have teams in charge of acquisition without depleting the resources on servicing existing clients.

PROMISING MORE THAN WE DELIVER?

Let me end by coming back to the banking sector. I have every international or new generation bank wooing me because they are under the mistaken notion that I am a high net-worth individual. They mail me, call me, message me and meet me frequently. If I were a girl that a guy was wooing with the same energy, I would have succumbed long ago. And yet when I do give them the business I find that this energy is no longer in evidence in servicing my business.

My constant refrain is that my Relationship Manager does not even last for a quarter on the average. So much so that if a new Relationship Manager asks to meet me, I invariably tell him to come three months later if he is still with the bank! Clearly there is a gap between what is promised and what is being delivered.

In fact the Relationship Manager is the brand to me and he is the one who lets it down, in my view at least. And in my view, despite all the hype surrounding the foreign and private sector banks, my good old nationalised bank is vastly better. It knows me and will somehow reach me when either of us needs to.

KEEP IT SIMPLE

So what are we saying at the end of all this.

Customer acquisition is important. But in quest of this elusive Holy Grail, are we jeopardising our existing relationships?

Are we promising and trying to be more alluring in the courtship phase? After marriage, we suddenly realise that the person we married is a different animal from the one who courted us.

It boils down to treating our customer as an individual who matters, like the manager of my nationalised bank does.

Customer service is not easy. But the gains are phenomenal, if you hang in there. It is not easy to hold on to existing customers for years. But when you do the rewards are phenomenal.

Are you gearing up to reap the benefits?

Ramanujam Sridhar is Director of Custommerce and Founder CEO of brand-comm, a communications consulting company.http://www.ramanujamsridhar.com

Customer aspiration based service design

When Henry Ford was asked if customers’ desires had anything to do with his path breaking Ford Model T, he had this to say, “If I had asked people what they wanted, they would have said faster horses.” Understanding that latent needs of a customer, which strongly revolves around a deep seated aspiration, can sometimes be the key to a product innovation, it can also be the building block of your organization’s service design.

When a customer walks into a BMW showroom, there are certain aspirations that are attached with a decision to walk in there. From the moment she walks in, she needs to see those aspirations getting fulfilled. Right from the first greeting, to the first question on what she wants. There can’t be questions of budgets and mileage. The questions need to come from the customer and possibly you will see an aspiration being realized. Creating a service design around this understanding of a customer, needs to be all pervasive from the way the salesmen deal with her, to the way billing and post sales is handled. The aspiration remains and possibly grows along with the ownership of the product. These aspirations are not attached only to luxury brands. Even mid market brands evoke aspiration among customers who may find such brands the pinnacle of their current stature and success. Working around these thoughts becomes a challenge as they are not that straightforward, yet, they do exist and discovering them lies in observing customer behavior. Customers tend to ask certain questions, get irked by some objections and are satisfied with specific features. In all these observations, lie the answers to what your customer is aspiring to become. Use those data points to build your service roadmap and watch customers enjoy the treatment in the way their purchasing behavior changes. Therein lies your organization’s reward for going that extra mile.

Customer aspiration has always driven many innovations, from a bulb to a Tata Nano. It wasn’t rocket science that built these products. They all were conceived by men and women who belonged to completely different aspiration levels. Breaking through the clutter of customer data and models, lies the simple art of deduction, of what your customer aspires to be, once she has used your brand. Let’s get started harnessing that power!

Getting Social on Social Media

Social media still manages to be a buzz word. Most of the business world was of the belief that the value of social media in business will soon reach its saturation point. But it continues to surprise businesses both small and big in the way one can approach customers, marketing and customer service. Now grasping the above ideas isn’t that difficult. Also, knowing that you need to be on social media isn’t going to win you any brownie points from your customers. But not being smart and maximizing your ability to give your customers great customer service on social media, can be an opportunity lost.

Studies say that customers who engage with companies via social media spend 20 to 40 percent more money with those companies than customers who don’t engage through social media. This should give companies enough impetus to provide great customer service on social media. The problem many see with social media is that neither is it face to face and nor are you talking to anyone on the phone. It’s a faceless conversation but social media has proven to be a great outlet for customers. People tend to interact more openly and freely online. This stemming from a certain anonymity coupled with a huge audience ready to listen and react. Customers expect companies to be more proactive on social media and this presents companies with a great opportunity to reach out and take action before the customer decides to. Being active by tweeting or replying to queries on your company’s Facebook wall instantly can be a great turn on for customers. It shows that you care and you are there. You can instantly put customers at ease as social media by nature is an informal environment. You can reach out to them faster by openly asking your customer base if they have any problems and then attack each issue head on. It’s not enough to be posting views on your brand and its marketing efforts; you also need to be able to reach out on issues that matter to a customer. And that is something you cannot do as easily from a physical outlet or through you call center.

Social media allows you to socialize with your customer. Chat them up, understand them and react. Being available on social media to address concerns makes you static and boring. It doesn’t help your brand point out any difference between your other customer service channels. Customers expect to be treated a certain way on social media and the foundation lies in the fact, that you got to reach out to them, talk their lingo and solve their problems just as you would do elsewhere. That is when the brownie points will start piling up like never before.

Big lessons that small companies teach

From Nordstrom (a Custommerce blog favorite) to Southwest to Taj, all are brands synonymous with great customer service. Yet these and only a handful of other large corporations seem to be known for their service ethic. But at the same time, you see many small and medium sized companies consistently getting their customer service ethos firmly in place. Many may attribute that to lesser customers or negligible hierarchy but like this article in HBR will tell you, it sometimes just comes down to empathy and common sense. So where else does the secret to good customer service lie in a medium sized enterprise? And what virtues of these companies can larger enterprises look to replicate?

A large hotel in Chennai is known to give its employees Rs.1000 everyday as a limit which they can use to repair any reasons of dissatisfaction with a customer. They can use that money on one customer or ration it through the day but it gives them the liberty to improve an experience. This can involve a complimentary drink, snack or anything that the restaurant offers. The limit ensures prudence yet at the same time it allows flexibility. Now, flexibility is an important lesson that most large companies can take from smaller companies like this hotel did. Small and medium enterprises generally have the advantage of flexibility in the way they can serve their customers. They can tailor their customer service efforts as per the customer requirement. Even larger companies can work past Standard Operating Procedures and bring in some flexibility to allow for a better service experience for customers. Another great virtue which large companies can pick from smaller enterprises is of having a top management which prefers a hands-on-approach. Customers of smaller enterprise are able to reach top management with their grievances much faster then they can reach a middle manager at a large enterprise. With certain protocols in place and by basing cases on priority, even a large enterprise can achieve this objective.

On the whole large companies need to see how they can bring in initiatives from smaller companies in moderation backed by strong business cases. They can serve customers much better by steering away from rigidity towards incorporating techniques that can improve the service experience. The lessons small companies are giving aren’t very tough to understand or implement. You just need to use common sense to know how much to commit, and remember, that all your customers need, is a little empathy. 

Customer service can save the day

Countries across Europe and Asia are reeling from the effects of a recession that had its roots in the US. Companies in these countries will instantly start looking at the various options available to them to manage the crisis. Options like layoffs, broad based pricing to target more customers and many more value draining methods come to the fore. What generally begins to suffer is always, customer service. But can, a recession, be the most auspicious moment to improve your customer service?

Southwest Airlines, Lexus and the Ritz Carlton are brands known to keep their customer service promise at the forefront even at the dullest of economic conditions. Brands must understand the value of upping their customer service game during the downturn as customers become more sensitive to prices and the way their service provider treats them. Customer morale is at its greatest low at this point. Investing in systems, processes or ideas  that can help build this morale can serve you well not only during the downturn but also post it, as customers will never forget the brand who showered them with the love they needed. We are moving into a time where customers are expecting soft brands. Brands that are more communicative, responsive and ready to speak. Research over the years has always proven that brands who commit resources to customer service during a downturn or who have always considered it a priority, come out of a recession stronger and with a loyal base of customers with negligible erosion over the years.

Learning lessons from companies who are focusing on customer service can be pivotal in dealing with a downturn. It can give many brands an edge over their competitors and create an advantage that in time will become sustainable, recession or not. A recession is the one time in the story of a brand that can help them concentrate on customer service, make it invincible to competitors and lovable to customers. So let’s start planning and acting, now!