Customer Service – a necessary cost or profit opportunity?


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In today’s highly competitive environment and period of recession businesses are faced with a difficult dilemma: they need to provide exceptional customer service, a critical differentiator that improves customer loyalty, whilst delivering a return on investment (RoI) that satisfies the stakeholders.

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Customer Service – a necessary cost or profit opportunity?

  1. 1. Customer Service – a necessary cost or profit opportunity? In today’s highly competitive environment and period of recession businesses are faced with a difficult dilemma: they need to provide exceptional customer service, a critical differentiator that improves customer loyalty, whilst delivering a return on investment (RoI) that satisfies the stakeholders. So can this be achieved? We know it can because we have delivered this to 2 global automotive manufacturers in the last 6 months. Through the work that we did we forced a paradigm shift in our clients’ expectations, resulting in the Customer Relationship Centre (CRC) being seen as an area that needs investment as it can generate profits for the organisation. This paper takes you through a journey that presents the strategy we deployed in our European and Australian Markets. The journey started by outlining the practical ways in which exceptional customer service can be generated, through to the impact it has on building loyalty. By then identifying ways that cost savings can be made and implementing any actions resulting from that, the end result for the client is an increase in profit for their business. Delivering Excellent Customer Service Step 1: Shared goal — Primary Quality Metric 3 Steps to Excellent Throughout the course of our work, we have ensured that the Customer Service entire company is focussed on one thing – delivering the best possible customer service. This involved a change of mindset Step 1: Shared goal away from the “traditional” call centre metrics of answering times and abandonment rates, to focus exclusively on the things that Step 2 : Understand the improve customer satisfaction. A customer does care if you don’t trigger points answer the calls within an acceptable time and not meeting this Step 3: Roadmap time will reduce customer satisfaction but meeting with times does not improve customer satisfaction. At Percepta we will have the appropriate service levels in place and will be meeting these but will be focusing on other important drivers of customer satisfaction.
  2. 2. Step 2: Data Analytics to identify Trigger Points This step involves a deep dive analysis of customer satisfaction results in order to identify the factors associated with improving customer satisfaction. In this example, analysis of previous customer satisfaction survey returns showed that the primary cause of dissatisfaction is actual resolution time versus expected resolution time, with a strong secondary factor of the frequency of contacting the customer with updates relating to their issue. The data demonstrated that satisfaction was negatively affected when the resolution took longer than the customer had anticipated ie simple issues the customer expects to be resolved quickly. High satisfaction was achieved by the centre instigating regular contact with the customer. Step 3: Intervention Strategy (Roadmap) Using the data gathered from the deep dive, we then implemented a number of systemic checks to ensure that we were able to identify customers who were in danger of becoming dissatisfied with the service they had received. It was important to ensure that such cases were identified before any negative satisfaction impact was realised and this was done by the creation of an “Intervention Strategy”. Using time as the primary factor, the intervention strategy identifies customer cases that are approaching that trigger point and promotes those cases for review. When a case reaches the trigger point, it is logged, reviewed by a senior staff member and classified in one of four categories that we have identified. These categories reflect the departments whose input are required to resolve the issues. Once the case has been reviewed and categorised, the case is then escalated to the appropriate channel and tracked until resolution. Surprise and Delight At the analytical phase we also identified that a courtesy follow up call made 7-10 days after the issue had been resolved provided customers with service that they deemed above and beyond their expectations. A follow up call in isolation will not magically transform an unhappy customer into a very satisfied one, it can however change a customer from being very dissatisfied to ambivalent, or from somewhat satisfied to extremely satisfied. Using this approach, we have converted customers who may otherwise have been neither detractors nor promoters of the brand into powerful advocates for the brand’s customer service and likewise changing the mindset of strong critics of the brand to ambivalence. Improving satisfaction with vocal detractors of the brand is an extremely important and often overlooked aspect of customer satisfaction.
  3. 3. Delivering on what you commit Customer Comments The strong secondary factor that was identified was regular “Could not have been better even contact with the customer, combined with delivering upon what we following up after the event” commit to. Every customer is provided with a date and time of when to expect a call from the centre and we ensure that our “They were very helpful and contacted promises are kept. If the case has not progressed as far as we me when they advised they would.” would have anticipated a call will still be made to the customer where we will provide an update on where the case is and give “Very good, he really cared and reassurances on when the next stages will happen. followed me up and kept me informed” The results In Australia, using the approach above, the centre recorded a sustained increase in customer satisfaction using Net Promoter Scores (NPS), culminating in recent NPS results of +43.1%. This great result was driven by the key approach of focussing on increasing every customer’s satisfaction, regardless of the outcome of their issue. This has meant that our most recent results show that over 60% of customers who contacted the centre rated the service they received as either 9/10 or 10/10. In Europe the approach has resulted in an increase in Impact of Improvements on Promoter score the volume of promoters from 12% to 21% and a 70% reduction of detractors from 26% to 14%. Overall these changes have resulted in incremental sales of 60% £14million. 50% 40% B efore % The approach we implemented also drove through cost 30% A fter savings via improved processes and consistent 20% methodology. In 2008, through improvements made to 10% the car hire process we reduced the average “vehicle 0% off the road” days from 18 to 5, translating into a saving Detractors Passives Promoters of £1.5m for the client. This has made the service the Category valuable one it is today. By contributing to increased sales and implementing process improvement to save costs, Percepta were able to return and overall RoI of £5.89 for every £1 spent to these clients in 2008. Thus, cementing the relationship as one of a partner from that of a supplier. For more information on how Percepta can assist you in transitioning your customer service centre to a profit centre please call 0141 571 3400, email or visit