Keeping Customers Informed

As I spend my Tuesday evening hanging out at the airport in LaGuardia waiting on a flight back home I am struck by how important it is to keep your customers informed even if the news is not good. I have to compliment the gate agent for USAirways who has consistently provided updates every 10-15 minutes on the status of our flight. This small gesture has helped to make a less than pleasant experience a bit more bearable. I would like to say that this is the first time that I have been delayed in New York but unfortunately out of my last 3 flights here I have been delayed atleast an hour and one evening spent more than 4 hours sitting at the airport only to have my flight canceled at midnight. The one constant between all 3 incidents was the ongoing regular updates from the USAirways gate agents.

Hopefully I will make it home tonight at a reasonable hour tonight. With the help and assistance from USAirways I have been able to keep my family informed of the status of my flight. The simple gesture of the gate agent to keep me informed has created a postive brand experience during a not so positive situation.

Locate My Nearest...

A common customer interaction for many retailers is locating the nearest store. How easy or difficult is it for your customer to find this information? Is there a store locator clearly shown on your website? Does the store locator show hours of operations, is there a local phone number, are directions easily accessible? If you answered no to any of these questions what do you think your customer does when they cannot find the right answer. Generally they have a choice,

(1) Keep looking for the information they need with increased frustration
(3) Call your 800# to find the required information
(if they can find a number on your website, that experience is for a whole other post)
(4) Go to a competitor

All of these options cost you money. If you are a consumer (which all of us are) what experience do you want to have? The easier and more accessible we make information, the better the customer experience will be. It may take a bit more time and effort but this simple transaction can say so much about your brand.

Now, how do you turn this very simple transaction into an ROI for your business? Let's say that in a particular market you spent $20,000 on local advertising and promotion and you expect that advertising to generate 50 new customers. The cost of aquisition is $400 ($20,000 / 50). If in the process of trying to find your actual store location 10% of your targeted customers gave up and went somewhere else your cost of aquisition just went from $400 to $444 ($20,000 / 45). In the first scenario if your average retail ticket is $100 it will take 4 visits to your store to receive an ROI on your initial investment. In the second scenario it would take 4.4 visits.

What if when the customer looked for a nearest location, the information requested is quickly provided increasing the liklihood of achieving your target of 50 new customers? What if you could also increase their average ticket price from $100 to $120 by providing a coupon or special promotion related to just that store? You now have decreased your ROI from 4.4 visits to 3.3 visits ($400 / $120).

See the attached article on best practices for improving your store locator usability.

http://bit.ly/thwvv0

Customer Care ROI Still Relevant

It has been some time since I last posted anything to this blog yet the focus on customer care and customer engagement has become even more relevant and important. Every interaction with your customer is an opportunity. It is an opportunity to reinforce your brand, an opportunity to extend their investment into your product or service, it is an opportunity to introduce them to new products and services, it is an oppportunity increase their lifetime value to your company. At the same time it can become a lost opportunity if it is not handled with appropriate care and attention. It still amazes me how many companies out their discount the importance of the contact center interaction with their customer. Instead they spend millions and millions of dollars investing in marketing, advertising, packaging and promotion yet treat the customer experience as a "necessary evil" to conducting business. As a long time contact center professional I have spent countless hours focused on key metrics such as average handle time, agent utilization, operational efficiency etc. All of these metrics are extremely important around managing financials but do little to measure the customer experience. It is exciting to see more companies begin to measure customer satisfaction, first call resolution, agent satisfaction and likelihood of recommending a product or a service. This is a great starting point to increasing customer care ROI. How can companies go further? How much time does your company spend in analyzing why a customer calls? Not just from a cost savings, call reduction standpoint but from a customer experience perspective. How different would their impression be of your brand if you handled the transaction from a customer perspective versus a policy perspective? More to come in my next post. I will attempt (time permitting) to take some of the more common customer interactions and explore how you or your company can increase your customer care ROI through those interactions.

I just read an interesting post written by Bruce Tempkin. Mr Tempkin has it dead on, we need to stop spending all of our time and energy on how to reduce costs and increasing efficiency. While this is still an important component to managing your call center operations, we need to also be focusing on increasing the lifetime value of our customers.

It is the balance that enables companies to be profitable and continue to grow.

http://bit.ly/bBgwXY

Initial Thoughts on Social Media ROI

Customer care professionals, marketers and PR firms are facing a new challenge. How do you quantify the impact of responding and monitoring social media driven conversations? What is the ROI?

Most in the customer care arena are familiar with a Net Promoter score. Net Promoter score was highlighted and shared in the book by Fred Reichheld, The Ultimate Question. In his book Reichheld shared the concept developed by Satmetrix, Bain & Company that provides companies with a means for measuring customer loyalty which in turn helps to build profitable growth.
Check out http://www.netpromoter.com/netpromoter_community/index.jspa

The main premise is that a company has three main groups of customers,

Promoters - Loyal customers who are vocal in the support of your brand
Passives - Happy customers who like your brand but could be swayed to other brands with the right offer
Detractors - Dissatisified customers who are not afraid to share their perception of your brand

The book goes on to talk about the financial impact to your brand when you calculate the balance of your customers and where they fall into each category. This is your Net Promoter score.

With the increased usage of social media does Net Promoter score become an even bigger factor for a company? What impact does a person with a extremely large social media following have on your brand if they are a promoter or a detractor?

More to come...

Part 3 - The Other Stuff

In the last of the 3 part series on the real cost of your insourcing customer care we want to make sure all of the other expense related items are taken into consideration that eventually add to the overall cost. We have already walked through that the real cost of agent wages is closer to $20 and that once you account for off phone activity and other unproductive time the real cost comes closer to $30.

Additional items to consider when trying to compare internal costs to external costs include the following:

- Supervision expense - depending on ratios this can be anywhere from $3.50 - $7.00 per productive hour

- Operating Expenses such as rent, utilities, supplies, etc. all need to be included when comparing internal and external rates. Depending upon the location of the operation this could be an additional $5-7 per production hour.

When all is said and done the cost of insourcing can be around $40-50 range compared to most domestic outsources that will charge a base rate ranging between $25-$30 depending upon volume and program complexity.

Now the key is finding the right outsourcer.

Part 2 - Agent Efficiency

What is agent efficiency? For the sake of this posting it is the difference between agent productive time and agent paid time. Different companies use different definitions and different terms to describe the same thing. It can sometimes be referred to as utilization, or production quotient. Agent productive time is the time an agent is logged into a call queque ready to take a call or is actually handling a call.


Many times when trying to determine the full cost of a production hour, efficiency is one of the most important facts NOT taken into consideration. Many insourcers attempt to equate a paid agent hour in their site to a billable production hour for an outsourcer. This can be a very costly miscalculation.


As demonstrated in my earlier post, we came to the conclusion that a fully loaded agent wages can be really running you close to $19.30 versus just the $12.00 hourly wage you are paying them. When an agent is paid 40 hours a week they are not actually on the phone ready to take calls that entire time. In general their 40 hours could be broken out as follows:


40.00 Hours Paid Time
7.50 Paid Breaks (2 paid 15 minute breaks each day)
2.50 Hours breakage (15 minutes lost time per day)
1.00 Hour coaching time each week
1.00 Hour team meeting each week
1.50 Hours of earned paid time off (assumes close to 2 weeks paid time off each year)
0.75 Hours of earned sick time (assumes 1 week paid sick time each year)
25.75 Average production hours per week

25.75 / 40.00 = 64.375% Efficiency

So now how does this translate to cost? For every production hour produced you have to pay an agent on average 1.55 hours (1 hour / 64.375%). If an agent is costing you $19.30 an hour and it takes 1.55 paid hours to produce 1 production hour each production hour is really costing you $19.30 x 1.55 = $29.98.


When you pay an outsourcer you generally ONLY pay for the production time, all unproductive time is on the outsourcer's dime. Wow, outsourcing may be a better deal after all.


Stay tuned, we still have not paid for supervisors or other overhead expense.

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