Latest Updates: customer relationship management RSS

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  Vikas 09:51:54 am on November 10, 2009 | 0 | # |
  Tags: customer experience management, customer relationship management, customer service, evidence-based service, social crm, Vikas Nehru

  Hype or Hyper-Measurement?

  Recently, Seth Godin posted on how we are moving into an era of “hyper-measurement.” As he explains, a journalist being fired because his or her web content isn’t drawing a lot of traffic is not going to be a newsroom novelty for much longer. In a world where, more and more, success can be measured in quantifiable metrics, why wouldn’t a publisher base business decisions on newly available evidence? It just makes sense.

  The customer service industry is no different. As my fellow blogger, Kate Leggett, points out, to truly maximize the value of their contact centers, customer service mangers must take an experimental approach towards service processes.

  For every end-to-end service process they design and deploy, managers must define a testing period during which they play around with different aspects of it and measure results against business objectives. These metrics can then be used to determine the relative effectiveness of the process – what worked and what didn’t – and update the service process, or eliminate it entirely. To ensuring ongoing optimization, no process should ever be viewed as final. Rather, managers must consider each and every service process as a prototype and resign themselves to always retesting and tweaking them.

  Delivering “evidence-based service” in this manner will help consumer-facing companies break bad habits, discover new tricks and cope with the constant shifts going on in their marketplace.

  For instance, a business introduces a new tool that captures and analyzes customer interactions in various community forums – essentially, pooling the collective input of the crowd at given time. The customer service manager applies that insight in real time to change, reprioritize and improve information presented to a customer on the self-help portion of a website or educate agents on a shift in incoming questions (depending on the level of service the company provides). Over time, they begin to see patterns in terms of what information is just chatter and what type of information is important to meeting their business objectives and their customers’ brand expectations. And, the way they use the tool – and incorporate the customer voice – becomes a highly sophisticated and beneficial to their service processes.

  The “hyper-measurement” trend, as Mr. Godin puts it, shouldn’t be ignored. It should be embraced. It offers a way for service departments, as well as publishers, to be more precise and pragmatic with their decision-making – to remain in control and one step ahead of the customer.<
   
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  Kate Leggett 07:23:55 pm on September 28, 2009 | 4 | # |
  Tags: Collaboration, customer experience management, customer relationship management, customer service

  Evidence Based Service – The How is harder than the Why

  Service organizations would perform better if leaders applied the best evidence. I’ve dedicated several posts to this subject. It’s a great concept and it’s another thing to do it.

  Some experimentation is easy – for example like what Yahoo! does on its homepage where they typically run over 20 experiments at a time, changing things like colors, placement of ads and location of text or buttons. Outcomes of these experiments can have a huge effect – like moving the search box from the side to center of the home page generated enough click-throughs to bring in about $20M more revenue a year.

  But this requires a mind-set shift–instead of debating which screen design or content works better, you gotta try it, and analyze the results to see what works.

  #1–Treat your service offering as an unfinished prototype. Baseline your performance. Then try to vary something and measure how you do – trying something half baked quickly with the data at hand is often much better than just waiting until you have all the data you need as the urgency to react may have passed.

  #2-Don’t get blindsided by corporate mantra, and organizational half-truths. Many service organizations are managed based on industry best practices, and historical precedence. Base your decisions on just data. Understand what works for you and your customers and do a root cause analysis to understand why changes you have made work or don’t.

  #3-Look at yourself using your customer’s eyes. Do a mystery shopping exercise on your site, and document your strengths and weaknesses. Look at your competitors and see what they do. Do it in a systematic, scientific way, not based on emotion.

  You can apply evidence based service at a micro or macro level-to a simple installation and tuning of a product–for example a new ERMS system. And, you can apply it to optimize a particular service offering, or transform your complete service offering to the next level of operational maturity
   

• Kate Leggett 05:57:09 am on September 22, 2009 | 0 | # |
  Tags: Communities, CRM, Customer Experience, customer relationship management, Voice of the Customer, Web 2.0

  Shopping, with a little help from my friends

  Even in this down economy, Forrester Research projects that holiday sales will reach more than $33 billion this season. That’s a lot of dough, and here are some guiding principles to help shape a successful online shopping experience.

  #1 – Make shopping fun. Entice users even before they are customers by using a consistent UI on all your site. Offer a variety of self-service methods, like visual decision trees that use pictures of products help orient users to their correct product, and guide them down a particular discovery path. Let them search by price range, color or even by personality like gadget geek, mom-to-be or fashionista.

  Interactive sites relying on technologies like AJAX work. You can drag and drop content on a page to where you want to interact with it. Use rollovers, sliders for price range pickers, or a color palette to search for items of a single color to make sites fun.

  Let peer pressure help you out by listing top searches or hot buys are – both which serve as good indicators of current trends..

  #2 – Let Users use their own words. Users don’t always think in the context of company-generated navigational topics. Let users tag content and browse tag clouds.

  #3 – Information on the User’s Terms. Push relevant service alerts or policy changes out. Let users create watchlists so that they can be alerted when an item goes on sale, or falls below a target price.

  #4 – Use the wisdom of crowds. You trust peer advice over company recommendations. Kaboodle, for example, touts “shopping is more fun with friends”. Append feedback forms and ratings to content and act on it.

  You will be more successful if you can streamline the shopping experience, and use community input to validate purchase decisions.

   
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  Esteban Kolsky 05:24:19 am on October 30, 2008 | 1 | # |
  Tags: CRM, Customer, customer acquisition, customer relationship management, customer segments, LinkedIn, segmentation

  Segmented Customer Acquisition Costs Save the Day

  (Part 2 of 3)

  Part 1 – Is It Really More Expensive to Get New Customers?

  Well, I hope you have read the previous entry in the series, if you have not – follow the link above and read it.  Yes, it is necessary to set the proper background for this one.

  Let’s dig a little bit deeper into customer acquisition costs.  In my previous entry I talked about a model where each customer carried its own acquisition cost.  You kept detailed records for each customer and how they become your customer.  You use these numbers to make customer-related decisions – satisfaction, loyalty, segments, etc.

  Of course, I can already hear the first complaint – what about if we cannot do that.  I would not expect you to go beyond your normal course of business to find out, but I’d expect your systems to be setup in a way that will allow you to capture that information.  If you do carry out a promotion or campaign, you know whom it went out to, and you tend to have unique identifiers (name and address, name and email, etc.).  Same thing with  leads captured, you know where they all came from.  You also know the costs for each of those events.  Presto!  you have the information you need.

  First, create a unique identifier for your prospects, make sure you collect the necessary data, and retain for each prospect what the costs have been for you to reach out to them.  Then calculate a cost per customer for each customer you already have in your database (if you don’t want to go through the trouble, average them – not recommended but doable).

  Second, change your new account creation process so it accomplishes two things: one, captures the latest marketing campaign or event that convinced the new customer to sign up; two, look into past campaigns to determine whether another marketing effort was aimed at this customer in the past – to see if you have a prospect cost for them. This way when you create a new customer, you already have their personal customer acquisition cost.

  OK, now there is one more wrinkle.  Some organizations, not all of them, will require an additional “plus” to be added to each account.  If you have a very large organization, and you spend some money in branding or marketing, spreading your name and making sure you remain in people’s mind, then you need to account for that as well as part of acquisition cost.  This is another shifting number, but not really hard to pin down.  Take your marketing or branding budget from last year, divide it by the total number of new customers you had last year – you have your “plus” number.   Add that number to each customer’s acquisition cost number – for last year only.  Make sure you update it every year for prospects and new customers that you reach out to for that year – even if they were there the year before.  Now you have a complete cost for acquisition for each customer.

  Yeah, I know.  Not everyone will have access to all this data.  True.  But you may be able to get some.  You may also be able to capture the data you don’t have today and start storing it for future use.  Further, you may be creating an excellent customer acquisition cost for use next year, or the following and you want to add these calculations.  Whichever way, you can see how useful it will be to have this. Now you can make better decisions on retention, customer maintenance, and <gulp> firing them.  Yep, now it  becomes a real simple business equation.

  If you dare to dream, think about benchmarking this and comparing yourself to your industry, across industries, across geographies – anywhere.  Once you create and embrace a model that others use as well, comparisons are easy.

  What do you think? Some food for thought? Care to try any of these in your organization?

  PS – stay tuned for a discussion on how to calculate a better customer maintenance cost…

   

• Esteban Kolsky 07:00:49 am on October 27, 2008 | 13 | # |
  Tags: CRM, customer acquisition, Customer Experience, customer relationship management, customer retention, customer satisfaction, LinkedIn, loyalty

  Is it Really More Expensive to Get New Customers?

  I don’t have the answer to this question mostly because it changes from industry to industry and organization to organization.  However, the question is valid.  As long as I have been in business (including time in college) I’ve heard a statement that goes something like “it costs [insert favorite number here] more times to get a new customer as it does to retain one”.  I have repeated it, as well as probably every one else in the world, as an unchangeable mantra of business. There have been studies that have confirmed this for different organizations or industries.

  Yet, in all the work I have done in the last few years with plenty of organizations, no one has taken the time to make sure this did apply to their business model.  I can probably count in two hands the number of organizations that have used accurate customer acquisition costs and customer maintenance cost when making decisions on CRM, CEM, and Loyalty programs.  I prefer not to tell you how many of those calculations were updated periodically as business changed.

  Even though we prefer to say it is cheaper to retain customers, it may not be.  A few things to consider.

  Customer Acquisition Costs.  No matter how much you try, you won’t have a single acquisition cost model for your organization.  Each time you generate new business, you will have incurred different expenses. Where did the leads come from and how much did they cost? How did we reach out to prospects? What were the costs of the campaign? How much did we really spend internally – including training, systems alterations and customization – attempting to get new customers?  Each time you run a campaign the assumptions will change, and the calculations will change.  What if the prospects were already part of another campaign — are your going to add the costs for both campaigns??  It gets messy and complicated really fast, and without those calculations you don’t have a real cost of acquisition per customer.

  Customer Maintenance Costs.   I have never met anyone who did a good job of calculating customer maintenance costs.  There are so many variables for each customer – even for each segment – that most organizations take a more “democratic” approach: the total cost of customer service operations divided  by the total number of customers.  Calculations should be done at the individual level, and consider each interaction, request, inquiry and final disposition for each interaction in relation to each customer.  While it is true that some customers will be virtually maintenance free, there are many others that are not.  Each time a new channel or service program is added, each time a customer contacts the organization for service or support the calculation should change. You cannot assign an average cost for all customers or you will miss the diamonds in the rough.

  Finally, once you have your customer acquisition and maintenance cost for each customer you must use them to make your on service plans.  How?  We will talk about that in more detail in future blog entries… stay tuned!

  Let me ask you first… what do you think of individual customer calculations? Are they worth doing?

   

• Esteban Kolsky 03:28:55 am on August 15, 2008 | 0 | # |
  Tags: CRM, Customer Experience, customer experience management, customer relationship management, customer service, Experience, feedback, Feedback Management, voice, Voice of the Customer

  how to make sure your customer service is the best, and your customers remain yours

  First, the acknowledgment… I wrote this for a presentation I am doing next week at the DestinationCRM conference.  Yes, it is my original material but it is not just for this blog… then again, we’ll see if I get more readers here or people at the conference next week.

  As I started getting my presentation ready for the conference, I got to the same point where creativity begins: reading the abstract that was submitted, trying to understand what possessed me to write that, and wondering how am I going to deliver on that promise.  Then I started thinking… I promised to talk about service experiences – how breaking down customer experience management projects into “chunks” makes it more manageable.  Since I am not sure I can cover an entire presentation on that yet, I decided to instead focus on service experiences… but come to it from a Top-10 approach.  Yes, I have taken tons of poetic license from David Letterman’s approach to the Top-10 – not even close.  So, without much further – here are my “ten killer ways to make sure you service experiences are the best and your customers remain yours” (the official title):

  1. right channel, right time – always ensure you are offering to your customers all channels they want to use, how they want to use them, and when they want to use them

  2. right person, right time – use workforce management to manage your people, their skills, their training, and their careers – ensuring that each inquiry is answered by the best person to do it

  3. right answer, right time (yes, there is a pattern) – optimize your knowledge management and repositories to ensure that each agent, client, and system interacting with clients automatically always have the right, and similar, answer

  4. right experience, right? – implement an efm initiative to manage feedback from customers and agents, geared to improving and presenting the right experience, all the time to all customers

  5. improve, reduce, discard – use analytics across all interactions, to make sure your processes are working properly, optimize them by improving poor performance, reducing unnecessary steps, and discarding non-working ones

  6. constant monitoring, continuous improvement – manage by KPI – no, not Key Performance Indicators.  Instead focus on Knowledge, People, and Inquiries – focus on them and your experiences will be superb

  7. metrics, choose wisely – don’t use old and tired efficiency metrics (satisfaction, loyalty, handle time, hold time, total calls, response time, etc) instead use the new effectiveness-based metrics to ensure great experiences (did you get what you needed? did we do a good job delivering?)

  8. evaluate new, don’t implement… yet – unless you are in an industry where competitive advantage is a mandate (not many), implementing brand new technologies will only cost you money and resources.  Implement in the second wave and you will reap more benefits (this has a killer graph to go with it, email me for a copy of the slides)

  9. know expectations, surpass expectations – use feedback tools and events to capture and understand your customer expectations; modify your processes to accommodate them; write SLAs to make sure you surpass them

  10. MAKE MONEY – sales is a dish best served piping hot — you are in the hottest moment to recommend, offer, and sell to your customers… right when they need it!  Leverage it.  You’ll be surprised to see how many other problems disappear when you make money for the organization.

  So, what do you think?  Did I miss any?  Do you agree or disagree?  What do you think of Service Experiences? let me know… and remember to email me if you want a copy of the slides…

   

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