Customer has changed

ShouldWeCare

Smart devices online access to information has changed customer and definitely has certain and strong influence to human behaviour, business and society. This change allow us and our customers to be more smart, safe, monitor over lives and … have more fun in life :)

Well-known radio DJ told a story: he was looking for a cat toilet. He went to his regular Pet Supplies Store in the super market. He was busy and actually cat toilet was not the world’s most important object for him. This particular cat toilet he wished was not available in his regular Pet Store he was used for years. Store assistant said „you could come and check next week again….“ Radio DJ turned around and went to the neighbouring Pet Store – just for checking. This type of cat toilet was not available also there, but … the assistant recommended to pick together from e-store in his computer the desired model, make the purchase and the cat toilet will arrive by tomorrow to customer’s home. So they did. And … the customer did not ask for the price as most important thing and he will use the same e-store for next purchases for his cat. Because it is really quick, very convenient and has caring attitude from a sellers side. 

CUSTOMER EXPERIENCE management is one of the main business drivers today

Change is always uncomfortable – entering to the unknown area, lots of work, some mistakes, risks to failure… BUT there is no possibility to ignore the change – unless we want to be out from business.

NB! Opening access to data of both parties, us and customers has also risks to be kept in mind like data security, cyber security, information abundance. This is important to be considered as could impact customer trust towards our product significantly.

Customer support in IoT era

I participated in June 2016  in Athens “Customer Contact Europe”. This annual conference was arranged  by Frost&Sullivan Executive MindXchange www.frost.com/cce.

Subject of my presentation

How smart

The main thrust and focus

Rapid shifts in technology and social media are impacting today customer behavior and therefore the way businesses are to be run. The economic importance is shifting from product to customer relationship, which in turn has strong effect to service provider strategy, set-up and processes.  It is inevitable to create in smart customer relations the skills and ability to follow rapid customer evolution – proactivity, increased knowledge standards, web solutions, communication in social media, enterprise transparency and speed

Specific take-aways

– Success factors of IoT, smart customer relations management

– Best practices as well as pitfalls of managing customer experience

– Example of how enhanced experience management has positive impact on enterprise financial results

Symbiosis between brand and service

When creating brand, it is essential that customer could understand and trust the brand peculiarities and its positive value.

Logo

Company logo is the foundation of the business branding. It is probably the first interaction that will take place with customers. An effective logo can establish the right tone and set the the characteristic spirit of a culture, essence as manifested in its beliefs and aspirations.

When setting a logo those questions are to be asked before :

  • What emotions does the logo generate? Is the meaning behind the same that logo reflects? Does it have any meaning? Could the meaning be understood when looking at logo?
  • Is the logo by sense, color etc in symbiosis with your products, target customers and company?
  • Is the brand & logo unique, clear and instantly recognizable?

But … it is absolutely important to bear in mind that brand and service environment* of a particular entity should be in logical connection = symbiosis

Internal and external identity must support each other and cannot! be random or incoherent. Companies do not often pay attention that marks of the service network appear rather different from given brand messages. Service environment could in such cases be characterized as worn, uneven, old-fashioned, dark, closed, sad, quiet, serious, bureaucratic, cost-saving, cheap, unprofessional, inward, indifferent, careless, …Traits that are most possibly not used in branding :)

Service elements are most certainly part of the brand communication, mirroring the image of the actual nature of the company. Brand and service environment discrepancies create in most cases customers’ confusion and mistrust towards the company. Regardless of company’s will, variety of characters influence always conscious and subconscious communication to the surrounding environment.

One of the service design goals is to create an emotional value, which is able to strengthen customers’ confidence and thereby increase brand loyalty. Important for service designers is not to follow what seems nice but what matches to the brand message. The brand and the service channels bearing the same message must reach the same settlement structure to meet the company’s core values and vision.

Services / service design elements help to create positive stories related to the company = brand recognition = customer confidence to the company and the provided services

Subconsciously we all perceive the different messages given by signs. The meaning of the signs could be given by promises, colors, messages, location, accessibility, status, emotion, cleanliness, ease, attitude, temper etc.

Bear in mind that:

  • Light, material, color, smell, sound, attitude, behavior, other customers – affect customer mood and judgment.
  • The more pleasant moments you create in service-points, the more customers trust the brand and are attracted to use the services again.
  • When designing services, the situations where customer feels confused must be avoided. The client feels stupid and/or irritated when he does not know how to behave as expected – ie services set-up is too complex for him to handle.
  • Customer first impression is hardly objective, but is crucial. It occurs rapidly within seconds grabbing a whole as far as it is possible to perceive / see / feel. In first impression more important is what customer feels than what he sees.

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* service environment: any direct or indirect contacts with customers: incl social media, homepages, e-services, call centers, bulk mailing, etc

 

Environmental impact on customer behavior

The economic downturn of past years has had a significant impact on consumer behavior and preferences. Consumers evaluate today significantly more personal time and increasingly prefer to conclude service deals and make purchase decisions without leaving home. Decision-making bases on a comprehensive data available on the Internet. Thus, the reliability of e-channels, in addition to the security is affected a lot by  high-speed information availability and comfort of it’s operations.

Simple and user-friendly eChannel can be created only when the provider truly understands its customer’s expectations/needs and is able to interpret client’s point of view. In addition, the company is able to build up an eChannel which is self-explanatory, easy to use for client but contains a lot of information.

CEM

New IT related opportunities in market have changed customer expectations and judgements: businesses are expected to create more transparency, customer desires to figure accurately out on what he spends money and why. Customer expects more smart and sophisticated services simultaneously the ease and speed of communication and the convenience of service setting.

If customer expects at the same time product / service complexity and simplicity, it has definitely a strong impact on the solution of a communication skills and technique in eChannel. E.g. long texts are “out” – no one has more time to read them and often does not even know how to read a longer text in any other way than “diagonal”. The visual language of communication becomes viable – data transfer through pictures and video, which in turn brings together service and design.

The communication skill is one of the keys to eChannel success. Capacities to communicate, so that the customer can get an answer to his question quickly, and even better, when the other customers can be included to this discussion. Comments are open to everyone, the company is able to respond to questions quickly and openly, without fear of negative feedback. Communication openness could be affected positively by eChannel combination with social media.

The customer is today impatient towards incompetence, but is willing to pay more for quality.

Customer:

– is waiting more information on purchasing decisions but would like to understand things easily and quickly;

– wants to have a good overview of the services consumed – not realizing that, selects the cheaper price;

– evaluates the speed, convenience and a competent information more than the price;

– prefers flexibility, consumption convenience of setting up the service in an appropriate just for him manner and degree.

e-service creates a strong competitive advantage

Last week we participated together with Hendrek Kraavi (strategy and creative director of ADM Interactive –  Estonian leading web-design agency) – e-services and service design seminar in Tallinn.

Our aim was to provide some answers to the following questions:

  1. What are the consumer-expectations towards e-services today?
  2. How to plan, design and manage the customer experience in Internet?
  3. How e-services affect the profitability and create competitive advantages for a company?
  4. How to create a beneficial e-service for a customer and how this reveals process errors?

Some notes from our presentation

eServices_1

E-channel is no longer just a nice alternative, but is becoming today the core value of a company. Internet, offering almost unlimited alternative choices is supporting to lift the power from a company to the consumer.

It is increasingly difficult today to differentiate by product or price. Still … there is option to differentiate by customer experience – stand out by an e-service quality, which is more convenient for the customer and eventually also more efficient for business.

Many of the conventional services, or companies are entering the IT sphere. Associated with the development of information complexity and amount of data makes the craft excessively time- and competence consuming. The solution here is a high quality e-service environment that enables new, more valuable and meaningful customer service.

E-service gives the company more opportunity to be operational and accessible during rush hours, and allow for a clearer direct interaction with a larger number of customers. e-channel permits the capability for a company to be prompt, attentive and visible, willing to listen, to hear, and to assist customer whenever necessary.

e-service allows entirely new service types, products, which are not feasible in face-to-face services. E.g. – give more information, more flexibility up to the services where visual element is vital.

Therefore, when developing a new e-channel – think out of box! The worst would be if you develop channel, which just reflects conventional service process and is subjected to outdated bureaucracy.

e-channel must let consumers to be more close to your enterprise and provide more than conventional services. In this case e-channel is capable of giving really strong competitive advantage.

When developing e-channel – design customer service process and respectively adjust your internal processes. Do not forget it’s quite often small things you do that make a big difference

Why Net Promoter Score?

customerreviewpeopleToday large number of companies all over the world use the NPS index (Net Promoter Score) to measure customer satisfaction and get quick hints for development. This is despite of fact that the method of this metric is only about ten years old. NPS main principle is trivial and linear – client recommends only those brands or companies whose goodness he is sure of.

Opponents argue that the measure does not give the full picture, and often requires interpretation. Having experienced variety of different in-depth researches, I would argue that NPS one of the most effective support engine for customer focused rapid changes for an enterprise.

One of the most significant NPS secrets to success lies in the simplicity and speed for both – the company and the customer.

Companies often experience a difference in evaluation given to the company and the service staff. Why? And what to for improvement the evaluation ?

Assessments given to the company and to the employee are almost always different and in favor to the last. The better the rating for the company and the lesser the difference with the employee’s grade, the stronger is the company’s position in the market.

The most important factor on business assessment is of course the quality of specific service situation. If this is weak, it usually always has negative effect to the company results.

Another significant factor, in order to improve the company evaluations is the brand – if its content is understandable and is positively visible. In other words it’s communication presence in media, social media, personalized communications efficiency (e-commerce helps a lot in here) and public visual identity.

Recommendations:

1. increase your footprint in social media

2. enhance bilateral regular communication in e-sales and e-service channels, which has great potential to support business communication capabilities

3. pay attention whether the company’s external brand identity coincides with the displayed messages and is not confusing.

Compliance with recommendations above has a positive impact to the NPS / customer loyalty and hence the company’s financial results!

 

The most important is competence … and then speed

Speed

Customers say today that the most expected from businesses is competence. And then the speed.

Considerably fewer count the price in decision making. Price becomes important when there is lack of competence and speed. The price war is for the company in most cases the downward path in spiral.

Consequently, all starts from competence?

What is competence?  This is knowledge + skill to pass this to the customer. Competent employees are also fast. But … acquiring knowledge takes time in most cases. Consequently, the smaller the service staff turnover, the greater the expertise. And you need to cut down your price less for competition.

Thus everthing begins for the company by great staff retention – fair fee, involvement, listening, development and great ambience composition.

So, a successful company can keep its good service employees … and is able to move up along the success-spiral. It’s as simple as such.

Oh, yes – good leaders are also needed. Those who are quick, dare to trust, change get everybody involved and are able to respect.

e-service as competitive advantage

Are e-services expected by customers?

E-commerce is evolving today into essential communication and consumption medium for consumers.

23% of American insurance customers are currently using a range of different online channels, including providers’ own websites and blogs, to research purchases. However, compared to other areas, the use of online channels is relatively low across the region. In Europe, 32 percent of consumers are already using online sources for research, and in Asia-Pacific, the mark stands at 39 percent.

However, the personal contact is still essential—especially when it comes to claims, as 50 percent in the Americas want personal contact throughout the claims process.[1]

Different recent studies in Estonia have exposed that e-services are considered vital by over half of the business and private customers. e-sales and -service channels have become for us important communication and comsumption output.

Recent economic downturn have had a significant impact on consumer behavior and preferences. Customer evaluates today more personal time and is therefore more willing to do purchase decisions without leaving home. But his decisions are made on the basis of in-depth information available on the Internet. Besides security are e-channels more trusted for quick access to wide information and convenience.

New opportunities have altered significantly expectations: consumer ecpects more transparency from the service providers, desiring to understand, for what he spends the money and why. He looks for smart and sophisticated services, but at the same time the ease and speed of the service setting. He is impatient towards incompetence and on other hand is ready to pay more for quality.

Client desires flexibility, convenience in service consumption and alteration of the rules just in an appropriate manner and degree. Such technical capabilities are provided by e-channels, where he is ensured the easy access to information, assistance, and he is given the opportunity to make his own changes to services.

One of the keys of e-environment is the ability and skill to communicate. The customer must get answers quickly, and even better, when other customers are included to the discussion. Comments are open to everyone, and the company is able to respond quickly and openly. Communication openness is positively affected by the combination with social media.

One of the e-channel basic goals is to win customer confidence, “thanks to the e-service channel, things are under my control, the company has gained the trustworthyness due to being transparent for me”

Why does the enterprise need an e-commerce channel?

E-channel is no longer just an nice-to-have alternative, but is becoming today the need-to-have core value. Internet offering almost unlimited alternative choices is supporting to lift the power from a  company to the consumer.

Increasingly difficult is today to differentiate by product or price. Still there is option to differentiate by  customer experience. For example standing out by the e-service quality, which is more convenient for the customer and eventually also more efficient for business.

Many of the conventionl services, or companies are entering with their services to IT sphere. Associated with the information development, complexity and amount of data makes manual customer support excessively time- and competence consuming. The solution is a high quality e-service environment that enables new, more valuable customer services and more sales.

E-services give the company opportunity to be operational and accessible during rush hours, and allows for a more clear direct interactions with a larger number of customers. e-channel gives the capability to be prompt, attentive and visible – willing to listen, hear and assist customer whenever necessary.

Strategic Management of Customer Relations

Stories by Leaders

are a series of experience exchange of Pärnu Konverentsid, where Estonian top executives will talk for 3 hours with other leaders, share their story in the open discussion with participants.

ER

In modern world customer-centered approach leads to success. “Strategic Management of Customer Relations” was the first of the leader stories in this spring’s conference theme. Ene Raja talked about her experiences.

In businesses where large number of customers do not have regular direct customer service experience the  service is perceived by the customer as an abstract of the fee to be paid.

In this case for an enterprise it is challenging to manage customer communication /loyalty and customer decision can be easily influenced by competition.

Command over customer experience becomes therefore highly important and should now be taken to the enterprise management level.

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The customer stays with the company, which provides to him good experience. Good experience management skills are for a service company the key for advantage today. Experience Management should not be random, it should be planned and managed carefully. Offer to your customer additional value, which is unexpected and would create a “wow-effect”!

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Do not expose the ignorance to your customer. TIP: customer is more satisfied with immediate response “we solve your problem in five days”, compared when the immediate response delayed and client receives your response and solution in three days. The customer wants to have control over the situation  – to know what and when are things happening with him/his question and when his problem is solved! This is often more important than quick (but not as quick as customer expects!) solution.

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Customer shares the positive experience, and even more, he shares the negative. Sharing the experience in social media has given the customer a significant position advantage. Compensate for the negative customer experience – it is cheaper and easier to have the situation resolved in favor of the client, rather than debate over the issue and degrade yourself publicly.

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Consumer expects kindness and friendliness, but he/she looks even more customer service expertise and competence to find the best solution and find it quickly. Trust service personnel and provide sufficiently broad mandate for decision-making – the limits within which employees can decide for themselves. Customers love today speed in decisions. This improves customer satisfaction, employee motivation, and company’s financial results.

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Distinction of the best pays off. Employees are different – recognize the best by prestigious remuneration. Evaluation principles should be clear and simple. Also, customers are different – sometimes it makes sense to abandon unprofitable customers to contribute more for the good. Create different service model for different customer segments!

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Communication with customers is mutual and two-sided – in addition to your telling, the client must be given word and you must hear it and RESPOND!

Customer communication in different media must always follow the basic direct communication rules: say hello, talk in direct speech, always respond to questions and say good-bye. As simple as such!

Ask for customer recommendations and link this result to your managers’ performance fee. This is the quickest way to teach your organization to listen your customers.

When asking customer recommendation (Net Promoter Score), it is really important (and smart) to provide feedback to the client, how your company uses the given recommendation and you get loyal customers without loyalty program! But when our loyal customer still leaves – then your price must be very wrong.

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Keep cost under control by smart development of e-solutions. Besides lower cost, e-channel provides in addition consistent service quality and good opportunities for additional sales.

The key for e-service is simplicity – customer expects easy and fast service. But … building a simple e-business solution is difficult task for a service provider.

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To each his own. Service design requires a different strategy for different national/ cultural environments. E.g. in Nordics customers can be on hold (queues) for a longer time period, in Baltics waiting in line more than half a minute would raise frustration; in South-Europeans prefer direct communication over e-channels, in Russia customers are satisfied receiving the necessary information from the telephone answering machine.

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Rules for creating a Great Customer Experience

In 2005 the UK’s most outspoken chef & entrepreneur Gordon Ramsey was a speaker at Customer Management 2005, London. We made then summary of some of his quotes that are really valid also today – eight years later.

    • – leaders do not create followers – they create more leaders
    • – create an organization with buzz. You need to involve your customers as players here – it is the customers who create the ambience.
    • – wow all your customers, not only the best ones
    • – listen your customers
    • – you are the customer’s champion, challenge complacent practices in your sector
    • – do not let success go to your head and you do not take customers for granted
    • – use the best ingredients (that includes people!)
    • – all business is show business – companies from all sectors are learning how to let customer in and join the “prosumption”experience – instead of being treated as just consumers.

“If there’s a buzz in our industry about a new restaurant opening anywhere in the world, there will be a booking made for a table for six within 48 hours of the restaurant opening. Those six will be my staff – three waiters from front of house and three kitchen staff. They’ll be there to learn and to report back. That’s how we keep up with competitor innovation and stay abreast of what’s going on.”

G. Ramsay quotes

“I was interviewed on the Letterman Show in the States. He said to me ‘While you’re over here, who’s doing the cooking back at your restaurants?’ I said ‘The same people who do it when I am there.’  “We have ten restaurants around the world. I don’t cook in all of them. It’s about inspiring and developing people to aim for perfection for customers then letting them get on and deliver. The better they become, the easier my job is.” “David Letterman was wearing a very nice suit. I leant forward and asked him who made it. He flashed the Armani label and said it cost around $1,000. ‘And did Georgio do the stitching?’ I asked him.”“If I seem abrasive it’s because I have to engrain in every member of staff that we are not more important than the customer. I am demanding perfection on behalf of the customer. Part of getting that message across is we insist that staff put themselves in the position of the customer.

“I had a talented young chef who insisted on making impressive little towers out of his dishes – you know the way chefs make your food into an architectural statement. I asked him to keep them flat and simple on the plate. He was very reluctant to. “One lunch time I noticed him constructing a lamb cutlet tower of Pisa-type thing on a plate, ready to send out to the customer. I came up to him and said ’Put on an apron that doesn’t have food stains on it and follow your food into the restaurant to see what happens.’ He wouldn’t. I, er, insisted. “So he creeps out as quietly as possible, not wanting to head out of his territory, and follows the food to the customer who had ordered the lamb. The customer immediately dismantles the tower so they can eat it. The young chef is crestfallen. But he gets it. The customer is there to enjoy the flavors, not marvel at an art form. From then on he always lays the lamb out flat on the plate. Because it’s about the customer, not about your precious work of art.”

“How do you develop the social skills of a chef, putting them in touch with the customers like that on a regular basis? At Claridges, that’s one of the reasons we set up the Chef’s Table, at the edge of the kitchen, so chefs can connect with customers.“

“We had young chefs working there who had never previously met their customer. Now they were forced to. They had to spend two minutes meeting a table of people and explaining to them what they would be doing to their dishes. Then, two hours later, they had to revisit the table and ask the customers what they thought of the experience.”

“Not only is this immensely powerful for the customer experience and for putting the chef right there with the customer, it also makes financial sense: each chef’s table turns over about three-quarters of a million pounds a year in what was the pot wash area.”