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Last October I made the case for Multi Channel Excellence in Customer Service in response to Esteban Kolsky’s plea for single channel excellence in Customer Service. Today I would like to get back to the issue, for I’m seeing some hard to get rid of “myths” in the channel debate, that I feel need to be “busted”. I think this ma be due to the uprise of the “omni-channel” buzz of late.
The omni-channel buzz is a buzz in (US) retail-land mostly. But, like anything these days it gets transported into other (functional) areas of business quickly, and without scrutiny to the original concept. In retail omni-channel refers to the use of multiple distribution/point of sale channels as in ‘brick & mortar’, ‘online’, etc. as well as to the so-called ‘seamlessness’ of the Customer’s experience when crossing boundaries between them on the path to purchase.
Now this has a lot of similarities with the CRM-channel discussion on multi- or cross-channel communications. But there are distinct differences. Where omni-channel distribution in retail deals with the Customer Decision journey (mostly), CRM’s communication channels are facilitating communications along the entire Customer lifecycle. Or to put it simple: it is clear that a web/online shop is a channel in the sense of ‘distribution channel’ but is not a channel in the sense of ‘communication channel’.
So I think it is important to distinct a company’s distribution strategy, from it’s communication-channel (- a part of CRM -) strategy, although the CRM’s version of it is largely also supportive of the Distribution version of it. In this post I’m discussing the CRM’s version though.
To be more specific: I’m advocating against the rising idea that companies should offer all communication channels to their Customers – in the name of Customer Experience -. More so I will try to explain why in most cases following an omni/cross-channel strategy will only result in poor Customer experiences, not better ones.
What Customers Value
The first myth that needs to be busted is that Customers need or want to be able to contact you wherever they are, whenever they want and via any channel they choose. In all my years of experience it has become clear to me that Customers value resolution over accessibility and that Customers respect they can’t have that at any given time. They may even like it when asked, but hardly use it when offered.
This is why contact centers (in The Netherlands at least) close at 9 or 10pm (I think there’s even a trend where these will close earlier with the increased capability to deal with most interactions online), this is why satisfaction scores do not drop (immediately) if waiting times increase and this is why Customers use the phone a lot more often than they use e-mail to pose questions.
In short: in most cases Customers don’t want (more) options, they want better (first time) resolution. So, if you are designing your CRM’s communication strategy you should stop thinking channels and start thinking end-to-end resolution from a Customer’s perspective. Making resolution work via one, or a few pathways is more important that making it work via all available channels through all thinkable pathways (or journey’s).
What Customers Hate
Another thing I’ve learned is that Customers just hate it when companies don’t seem to recognize them as a (valuable) Customer. Customers are busy and they don’t like it when a company seems to forget about them. Forget their purchase history, forget their prior contacts with the contact center and let the Customer fill/spell out her details on every web-site visit, new form to be filled out, or call to be handled.
And we must be honest about the state of most company’s capability of doing so. Legacy systems, quick and dirty implementations, and last but not least: costs involved to make that happen along the entire journey, over all touch-points and in all channels are so high that one should question whether it makes business sense..
What Customers Love
… for Customers also love one specific aspect of any product or service they consume: its value for money.. And that poses some restrictions as to how much and on what we spend the money available to us. We can’t be great at everything. So we can’t just spend it on everything we believe Customers want. We have to spend it wisely so that our Customer(s) get what they value (most). So, if they value resolution over accessibility, it probably makes sense to invest in your capability to resolve, not to be accessible (provided you have a level of accessibility that is in line with general Customer expectations). And we cannot do both in most cases. For if we do, we risk to outspend our revenue, and we don’t want to go there, do we? In the longer term that’s not even in your Customer’s interest.
We also need to acknowledge that not all Customers value the same things and thus have to accept that we disappoint some Customers. In fact we have to accept that we disappoint most Consumers, far more than any company can satisfy. But we only do so to be able to deliver against (and in specific cases even above) expectations of the Customer segment that values what we chose (and are able) to do best. If we choose to serve all Consumers to all of our best capability all of the time, we will end up with sub-par mediocrity at best.
Do you know what your Customer and target segment values most? Are you spending accordingly? Or are you riding the Customer Experience hobby horse into the wasteland?
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Another interesting post. And another challenge to one of its underlying assumptions.
You say that “it is clear that a web/online shop is a channel in the sense of ‘distribution channel’ but is not a channel in the sense of ‘communication channel“. This makes absolutely no sense at all, for a number of reasons. Firstly, all of the research going back over more than 20 years shows that customers are influenced by their many different touchpoints with a brand. Not all touchpoints are equally important, but they all influence the customer. Because they communicate something about the brand, that makes all touchpoints, including web/online channel touchpoints, into de facto communications channels. And the more experiential the touchpoints, the more they are likely to influence the customer. That makes the web/online shop into a potentially far more powerful touchpoint than traditional marketing touchpoints.
Secondly, the original work on Customer Value Propositions by Lanning & Edwards included both the how the customer experiences value and how they quantify value in the definition. It is self-evident that the web/online shop is a very big part of the experience of the online customer – one retail bank I am working with gets more than 50% of its sales through the web/online shop channel – and how they quantify the value through mental accounting will influence their decision to patronise the web/online shop in the future. Most customers intuitively know that marketing makes promises that can’t be delivered. They often buy in spite of the soft lies that marketing communicates. Customers’ experiences of the web/online shop suggests it is a far more powerful communication tool than any amount of marketing’s undeliverable promises.
And finally, research into impulse buying shows that over 90% of people regularly buy products on impulse. Indeed, it is estimated that up to 60% of all purchases are driven, in part, by impulse. And the Millennial generation as a cohort are 50% more likely to be driven by impulse than older generations. The web/online shop is increasingly the place where many of these impulse purchases take place. It is ridiculous to suggest that they shouldn’t be used as communications channels to persuade, nudge or otherwise influence customers to purchase products right there and then. The telos or purpose of marketing is to create a hot lead, how much hotter does a lead get than a customer with his finger hovering over the buy button?
Your suggestion that the web/online shop is a not a communication channel is not only wrong, it is also dangerous. In an increasingly digital world the question is not whether the web/online shop is a communication channel, but how to turn communication channels into instant pathways to purchase through the web/online shop. Your customers’ next purchases should only be one click away.
Of course the website is a channel to communicate. I just said (or at least meant to say; I see it can be confusing, specifically if taken out of context) we need to ensure that we know when we are talking about the online shop as a distribution channel and when as a communication channel. And merely so to make clear that when we talk “omni-channel” or “multi-channel” it is important to understand how the two concepts (distribution strategy and CRM-strategy) relate..
And even then.. the gist of my post is about knowing what to focus on and what can be put aside. Sure we all need a web-site and in some industries the online shop might be(come) mandatory. But do we all need Live-chat? Video-chat & Twitter & Facebook & the Phone & Fax & Snail-mail & Communities & Mobiel apps etc etc.. to have dialogue with our Customers? I don’t think so.. Do you?
The real danger comes from the introduction and careless pushing of new “buzz-words” like omni-channel.. not from me ;)
Wim, your point of view to customer management was a little bit different than I was accustomed to read. But it led me to look differently to all of this.
Very well written article!
The fallacy of social media being lower cost than the voice channel is rapidly becoming apparent to quite a few companies. I won’t name any names here because they have confided in me in confidence.
Several globally recognized companies are quickly backing away from trying to provide service via social media as they are finding the cost per contact is much higher than the voice channel. Furthermore, the mirage of better service through social media is rapidly wafting away as millions move to Twitter and Facebook, because they previously received better treatment in those channels, and now they are sitting in queue with the other millions of social media users believing the same thing.
So we’re now seeing automated responses that fill in a form that requests the social media user to switch to either voice or email. And the social media mavens are whining about this, believing that companies should hire hoards of customer service reps waiting for every Tweet that arrives, just to start a 140 character game of ping pong to get at the relevant information necessary to help the customer. All this social media channel game is doing is moving the same service requests to a less efficient channel, while placing the messy transaction out in the public square. Which is not a good reason for any company to support the move, just because someone believes they should. Raise costs, move to less efficient communication, have a public dialogue? Nah, not a very good idea! Better to improve customer experience in existing, more efficient channels, and truly lower the barrier for customers to voice their complaints through the same channels.
My perspective on this, “Forward to the Past Instead of Back to the Future?: http://voxperitus.com/2013/02/past-future/
And Robet Bacal’s well thought out article with the same perspective, but even more negative than mine, “Eight reasons why social media negatively affects Customer Service and the Customer Experience: http://work911.com/articles/socialtechworse.htm
Nice article Wim,
Adding more channels might lead to the “pimp my ride” effect.
Adding more features like a big fat screen TV at the back of the car
might look very cool and useful at first glance, but is it really adding
to the original purpose of the car, are the new features actually used
after installing them and even more important : Am i willing to pay the
increased price that comes with them ?
On the other hand i also agree with Thomas,
In the drive to cut costs (and thus price) important valuedrivers (like human contact)
have been eliminated from the process, leading to dis satisfactory experiences.
Its the exact opposite of the “pimp my ride” effect (cause by the commodity trap?) and companies constantly need to find the right balance between perceived price and perceived added value.
Again a great post.
Really agree with you on the subject. Reminded me of a great book by Frances Frei and Anne Morris (uncommonn service), in which they state: if you wanna be good at something, you must be ‘bad’ at something else. Because you can’t be everything to everybody.
Focus is important and making hard choices. In my daily practice i recognize customer’s favour for (first time) resolution over accessibility. But it’s a hard choice to make to not be accessible via one or more channels. Nevertheless, it might be the only choice you can make in most cases.
In general, the channel discussion is far too instrumental in my opinion. Let’s talk excellent, obvious service and ‘getting the job done’ (as you would state).
Unfortunately its easier to ‘open’ a channel then it is to open your heart to customer’s real preferences….
no real disagreement, and I see the part in brackets ;-) – I think it is mainly a difference in emphasis. To me the capabilities to resolve don’t make too much sense if they are not accessible. And right now it appears to me that the capabilities of resolution are higher than the possibilities of getting there – and that companies showed a tendency to increase my (customer’s) difficulty to get into a resolution process. It is a kind of a chicken-egg problem: Being easy to reach without ability to deliver isn’t good, the other way isn’t either. My impression of recent service interactions is that, once one is through to the smoke screen, one gets pretty good resolutions, but getting there is the hard part. That would speak for more (smart) investment into ways of accessing service, considering limited budgets and customer strategies, of course.
I have trouble seeing where we disagree :)
I said: “it probably makes sense to invest in your capability to resolve, not to be accessible (provided you have a level of accessibility that is in line with general Customer expectations)”.
Seems to me that last ‘condition’ is what’s missing in your example.
Maybe they should skip all the digital comms channels and re-open the phone ;)
interesting as usual :-) but I think your argumentation comes a little short.
Assuming that I purchased with a company because I think they are delivering the right thing for me. If I have a problem with it then I want a resolution – and a fast one. Now here’s the challenge: I do not care about the channels, I want one that is efficient for me (and not the company). Companies on the other hand moved away from (human operated) phones because it is too expensive for them; they tried to move me to cheaper means, like automated phone systems, self services, e-mail, even FB and Twitter.
What is the result?
– I can’t get access via the phone without going through a hideous phone tree
– the self service options via the web are often poor (what does it tell us if people google for a problem’s solution instead of visiting the company’s web site right away?)
– E-Mail gives me an automated response and then – silence and poor interactivity, which one often needs
– Twitter & Co provide me with a fast means and (if I have enough followers) a quick response
So, yes Wim: Companies must think (customer oriented) process here but they also must be accessible for an efficient first time resolution. And they must be clear about which channel is the one that serves me best (or where they want to have me) – and why.
And then they “just” need to deliver (in the constraints of their budget) …