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How Strategic Social Customer Service Generates and Preserves Revenue

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How Strategic Social Customer Service Generates and Preserves Revenue

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Most organizations measure the value of customer service as a cost center. Few take the position of seeing customer service as the provider of customer satisfaction, loyalty and word of mouth.

To view customer service as a strategic asset requires that the organization see customer service as a revenue generator and a preserver of revenue. Strategic customer service then provides a new financial view of service and the investments in the end-to-end customer experience.

In this talk, we’ll cover strategic social customer service, including:

* Impact of social media on customer problem prevention.
* Why customer service is PR and PR is customer service.
* Large, blue chip company case study for social customer service ROI.

Most organizations measure the value of customer service as a cost center. Few take the position of seeing customer service as the provider of customer satisfaction, loyalty and word of mouth.

To view customer service as a strategic asset requires that the organization see customer service as a revenue generator and a preserver of revenue. Strategic customer service then provides a new financial view of service and the investments in the end-to-end customer experience.

In this talk, we’ll cover strategic social customer service, including:

* Impact of social media on customer problem prevention.
* Why customer service is PR and PR is customer service.
* Large, blue chip company case study for social customer service ROI.

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How Strategic Social Customer Service Generates and Preserves Revenue

  1. 1. How Strategic Social Customer Service Generates and Preserves Revenue Kathy Herrmann and Dr. Natalie Petouhoff
  2. 2. Kathy Herrmann Dr. Natalie Petouhoff Measurement & Insight, BCF UCLA & Executable Strategies (757) 497-4811 (310) 919-8467 kherrmann@boomyourbrand.com DrNatalie@gmail.com www.boomyourbrand.com www.drnatalienews.com
  3. 3. ROI Considerations 3
  4. 4. Start with Objectives and Strategy… …know where you want to go.
  5. 5. Measure the right results. The end goal of measurement is not to collect a bunch of metrics but to gain
  6. 6. CXOs will look for actionable intelligence in monetary terms… …revenues or cost savings. 6
  7. 7. What is ROI? A Numerical view of strategy And high ROI means executive approval for your initiative. 7
  8. 8. ROI Primer 8
  9. 9. 9
  10. 10. Examples of Benefits Cost Savings Reduce call volume Reduce email volume Increase agent productivity Increase FCR Reduce SEO cost (Impact on Business) Revenue Improvements Increase customer lifetime value, including customer retention Increase product ideation Increase lead conversion rates
  11. 11. Cost Examples People Training Staff Process Marketing of community (Impact on Technology Budget) Community website design Single sign-on Integration to contact center applications, such as CRM Platform subscription fee Analytics Reporting
  12. 12. Large Call Center case study 12
  13. 13. Annual Results: • Blue Chip services- oriented company • Revenues = $34.6b • Customers = 100.7m • Total Call Center reps = 30k • Social media team = 25 members
  14. 14. Social approach - Twitter: • Proactive tweets based on call drivers. • Conversational tweets to: • Answer questions, • Address complaints. • Agents friendly, approachable. Given autonomy.
  15. 15. ROI Focus: 1. Agent deflection 2. Customer retention revenue
  16. 16. The Customer Retention Revenue Impact™ Model • Financial point of view about the value of Customer Service to the organization • It’s based on the: – Ability to prevent problems – Ability to fix problems – Customer word-of-mouth power and – Company’s financial goals to generate and preserve revenue
  17. 17. Most customers don’t complain before deciding to leave! Aggregate of company’s survey data & call center stats: 101m Satisfied Dissatisfied customers 85% 15% total Churn Risk 15m Stay Silent customers 98% Complain at Risk 2% Industry averages Saving the silent majority = $$$
  18. 18. Impact of Social Media 2% Complain 98% Stay Silent • Most complaints are fixed • Most customers never in the call center complain but “suffer in silence” • Unresolved complainers can be highly “visible” to • Social can resolve issues, others friends/social and influence “silent media sufferers” who watch what we do and say in • Social Media team has social media opportunity to fix 15% of complainers (not resolved by • One to Many Call Ctr. or who posted their issue in the social sphere and never called) Revenues retained = $10.3m/ year By saving a portion of the 15m customers
  19. 19. ROI Description 19
  20. 20. ROI Description 20
  21. 21. ROI Description 21
  22. 22. ROI Description 22
  23. 23. ROI Flowchart – Case Study 23
  24. 24. ROI Formula ROI = (Gains - Costs)/Costs x 100 = ($10.3m - $1.5m)/($1.5m) x 100 = 583% 24
  25. 25. Steps to Setting Up Social Media Measurement Program
  26. 26. Set up business goals 1. Talk with business stakeholders to find out what business goals they want to reach Examples: • Decrease customer service calls to the contact center • Increase sales enquiries or conversions by 10% from social media sources within 3 months
  27. 27. Goals For Social Media • Why are you participating in social media? • What percent of your customer base uses which sites? • How will social media improve the customer experience? • How will social media help you build and reinforce your brand? • How will you support agents in monitoring and responding to social media? • How will social media help you build your knowledge base? • What protocols are in place to help agents determine when and how they should respond? • How will agents use the knowledge base to support conversations?
  28. 28. Set Up Social Media Measurement Program 2. Determine what data / measurement process you have. • Often times companies don’t have a measurement process for social media. • Sometimes the data required for calculations may be housed in other departments. 3. Determine what you are going to measure: • Set your key performance indicators.
  29. 29. Set Up Social Media Measurement Program 4. Measure and calculate your baseline. 5. Determine your ROI. 6. Make changes to your measurement process, your social media strategy and do it again.
  30. 30. Benefits to Social Media Measurement Program • Articulate the business case. • Calculate value & ROI. • Do more of the right things. • Put structure around what can seem unstructured. • Benchmark “As Is” and create a “Could Be” plan. • Justify the plan to upper management by showing them the business reasons. • Track the progress, gather the right metrics . • Assess the progress & iterate. • Create and sustain a world-class social enterprise brand.
  31. 31. By calculating ROI you will gain… • Better executive buy-in. • Increase budget spend. • Do more of the right things. • Get better decision making- to make the right changes to your company so it stays competitive. 31
  32. 32. Kathy Herrmann Dr. Natalie Petouhoff Measurement & Insight, BCF UCLA & Executable Strategies (757) 497-4811 (310) 919-8467 kherrmann@boomyourbrand.com DrNatalie@gmail.com www.boomyourbrand.com www.drnatalienews.com

Editor's Notes

  • Has your call center determined the financial impact of the cost savings and the revenue improvements? It is a worthwhile exercise but takes some time that we don’t have today. Include the budget people from the call center operation in the discussion.
  • Do you know the average costs for each component in the People, Process & Technology area. Start a brief discussion about each one
  • Adjusting subscribers to 85m from 92m.Adjusting churn to 0.95%.Lowering Non-complaining social media saves to 0.2% (which makes it the same rate as for complaining customers).Per Marina’s suggestion, everything is also shown as rounded.  The result is now about $16m in total savings with an ROI of 1097% (the big hit being lowering the social media save rate).
  • .02% of at risk subscribersAdjusting subscribers to 85m from 92m.Adjusting churn to 0.95%.Lowering Non-complaining social media saves to 0.2% (which makes it the same rate as for complaining customers).Per Marina’s suggestion, everything is also shown as rounded.  The result is now about $16m in total savings with an ROI of 1097% (the big hit being lowering the social media save rate).
  • The is a list of questions that should be completed in class as an exercise.

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