The changing face(book) of customer service

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By: Wise Marketer Staff |

Posted on June 7, 2010

The changing face(book) of customer service

The proliferation of blogs, podcasts, video, chatrooms, social networking sites and other online interactive communication is transforming the corporate-customer relationship, according to Keith Pearce, senior marketing director for EMEA at Genesys-EMG, who  explains how to implement a strategic social media plan.

Cracking the 'social customer service conundrum' requires a coordinated strategy for establishing, maintaining and optimising customer relationships. This, according to Pearce, can provide almost immediate payback through cost savings, better customer retention, and increased revenue.

A recent global study by the Economist Information Unit (EIU) and Genesys found that 81% of executives were torn between investing more heavily in traditional customer service (aimed largely at baby-boomers) and accelerating investment in technologies designed to appeal to a new generation of younger customers (Millennials, or Generation Y, who were born between 1982 and 2001). Today, Millennials already outnumber baby-boomers, which means that organisations need to set up a social customer service strategy during this year - which is possibly sooner than most had expected.

Every new plan needs a justified spend and, as businesses start to recover from the economic downturn, they are scrutinising every penny. This can be a stumbling block for new social media strategies, as one of the biggest challenges is accurately gauging its immediate business impact.

Companies can assess the value of new channels and social media collaboration based on three key measures:

  1. Customer satisfaction and retention The 2009 Cost of Poor Customer Service report found that 80% - 90% of satisfied customers would easily leave if the circumstances were right. Even though they were satisfied, this highlighted the fact that the right offer at the right time can take them away from you. The only way you can combat this is by truly engaging customers to convert them into 'prosumers' - individuals who have a more pro-active role in making, shaping (and sometimes even breaking) purchasing patterns, and who are now driving the process and influencing their peers.  
  2. Cost reduction and optimisation For example, Personal Paraguay (part of Telecom Italy) found that by adding an SMS channel, more than 2.7 million calls were transformed into text messages - a customer choice that reduced the cost of customer service by more than 75%. Another Genesys client in Egypt, Etisalat, was able to keep the cost of its 3G video customer service offering in check while scaling its staffing to more than 500 customer service agents. It grew from zero to more than 7 million subscribers in just over 20 months, and the video channel allowed Etisalat to reduce the cost of service per contact by two thirds.  
  3. Real revenue gains Again, Etisalat's new video system led to an 11% increase in overall customer satisfaction, and a 70% decrease in complaints in its first year of operation. Recent Forrester research found that the annual revenue gains from only a 10% difference in customer experience could reach some US$300 million per company per year.

Many companies seem to have already embraced new media, adopting a more measured approach toward text messaging, Facebook and Twitter as an initial port of call. But this is just a first step. The real need is for companies to leverage new communications channels and social media for bottom line benefits. This requires them to:

  • Assess the opportunities and the ROI based on all relevant factors - cost reductions, satisfaction, growth, etc. Walk through the entire sales and service process for different segments of customers, to identify opportunities and gaps.  
  • Realise that you can't do it all at once. Establish a media policy that identifies and prioritises the most useful channels. Look for feasible improvements that give customers a better overall experience.  
  • Identify the appropriate technologies and solutions. Provision the right infrastructure and environment to support top communication priorities and deliver appropriate content that best leverages those channels.

According to Pearce, the best strategy is to take one channel at a time and build it up into a stable, scalable infrastructure. Whether that channel be Twitter, a discussion forum, or an online user group, put enough resources and effort behind it to make it work.

At the same time, engage with customers but make sure you don't intrude on interactions where you don't belong. "You cannot be a 'peer' in a peer-to-peer interaction. Instead, show your customers that you are serious and that you plan to stick around for the long term. If you respect your customers - and the community - they will most likely respect you back," concluded Pearce.

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