Retailers face a nightmare before Christmas

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By: Wise Marketer Staff |

Posted on August 4, 2010

Retailers face a nightmare before Christmas

UK retailers are risking their share of the predicted £5.5 billion Christmas sales boom by not being able to effectively handle the seasonal spike in customer service demand, which can increase by as much as 400%, according to multichannel customer interaction software firm Eptica.

The firm has warned that companies failing to ensure their customer service can cope at the most important trading time of the year could miss out on the opportunity to increase their sales by perhaps 5% or more.

Leading up to the festive season, contact centres tend to be inundated with customer enquiries, often involving large numbers of questions about the same topics. This increasing volume of routine, frequently asked questions (FAQs) can quickly lead to poor or slow service, resulting in heightened customer frustration and lost sales at a time that represents up to 50% of a retailers' annual revenue.

Research conducte using Eptica's customer base has shown that by reducing seasonal inbound FAQs and more efficiently responding to customers' enquiries at peak times, retailers can increase sales by an average of 5%.

According to Dee Roche, European marketing director for Eptica, "We looked at before and after scenarios at 280 organisations across a wide range of sectors and found a similar uplift in sales. This can be achieved by businesses using increases in efficiency as an opportunity to redeploy customer service resources to sales conversion activity and on delivering high quality service and advice to help potential purchasers. These benefits can only be realised by diverting low value questions away from customer service agents."

The company found that retailers can experience four times their normal level of customer enquiries in the build-up to Christmas, including more than twice the normal volume of inbound emails. For contact centres that handle thousands of calls and emails a day, this represents a significant volume of customer enquiries. For example, a contact centre receiving only 500 calls and 750 emails a month could easily see that number increase to 2,000 calls and 1,500 emails.

But, without the right systems in place it is difficult - if not impossible - to quickly identify which enquiries are potential sales and which are basic FAQs so that they can be filtered, prioritised and handled accordingly (or even handled automatically where possible).

The challenge for retailers, Roche suggested, is simply to ensure that enquiries that could result in a sale, if handled promptly, aren't lost because agents are tied up dealing with more basic questions.

With consumers starting their Christmas shopping months in advance the increase in customer enquiries for retailers can gain momentum as early as September. The spike that this creates in customer service continues to build throughout the January sales season, well into the end of February. Retailers continue to face a high volume of post-Christmas enquiries as customers contact them about issues such as gift returns and product support.

One company in Eptica's study was able to cut the number of inbound contacts it received from 6,000 to 3,000 during a peak customer service month while at the same time increasing its sales (compared to the same period the previous year). The same company also achieved a reduction in the cost of handling each contact from 6.50 to 1.70, resulting in a customer service saving of nearly 34,000 in a single month. This was achieved by migrating routine questions online using Eptica'snatural language self-service and email response software.

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