In the past few years there has been a seismic shift in the balance of power from the brand powerhouses to über-savvy consumers, who know what they want and how to get it. There is no such thing as dyed-in-the-wool loyalty any more. It is earned the hard way and not acquired with a plethora of buy-one-get-one-free offers. Consider the Web 2.0 phenomenon, driving word-of-mouth recommendations; just this one channel has the ability to test brand loyalty to breaking point in a matter of a few mouse clicks.
In certain quarters, history is repeating itself. In the late 1990s, businesses – many of which should have known better – were seduced into thinking that customer relationship management (CRM) would, at the flick of a switch, increase profits and customer loyalty overnight. As is well documented, it did not go to plan and CRM’s spectacular fall from grace was the result of a notable absence of a clear business strategy and a shortage of people skilled enough to figure it all out.
Experian Integrated Marketing’s research among 1,000 UK consumers suggests technology is once again triumphing over common sense in customer service. The research reveals that brands are making it too complex for customers to deal with them because of technology.
In fact, 78% of respondents believe brands place too much emphasis on technology, instead of using purchase and preference information to enhance the customer experience. Equally, consumers blame “impersonal” technology used to get them off the phone as quickly as possible ,and 70% find “inflexible” technology just as frustrating. While online encounters need not be tactile in nature, the stumbling block in the call-centre domain is that customers want to be wooed and they clearly feel like they are being treated like cattle.
Symptomatic of the problem is that two-thirds of consumers in the study admit to having suffered telephone or Web customer service problems in the past year. Yet, when trying to resolve an issue, 89% still instinctively reach for the phone.
The problem for brands reliant on frontline call centres is that just 38% of issues are resolved first time. Compare this to 63% of issues that are addressed the first time of asking online and it begs the question, how can a series of Web pages resolve an issue quicker than call-centre personnel?
Possibly the biggest blow to companies is that only 7% of consumers actually believe the technology delivers what they expect as part of good customer service. All customers actually want is for companies to make it easier for them to communicate with them, whether it be online or via the phone (60%), and that systems should instantly know who they are, no matter what part of the company is being dealt with (59%).
Consumers also want more communication within companies, with 59% of respondents saying technology should be able to synchronise all customer information across various parts of the business. Customers also want a seamless process of communication, whatever channel is used (60%), while just over half (52%) want technology to help reduce the amount of time it takes to make a purchase.
Just 7% of respondents say the technology in place handles their customer service needs satisfactorily. This compares with over a third (37%) of consumers who believe that technology will not answer their needs for at least five years. This perception versus reality conundrum will be a major concern for brands. The technology does exist, but clearly it is being used badly and consumers think it will be some time before it will deliver something valuable for their personal customer experience.
The research points to the fact that businesses have lost sight of their most important asset – customers. The mindset appears to be that by investing millions in Web and call centre technology, brands will create instantly happy, satisfied customers.
Not enough companies understand how to integrate customer data and technology with the whole customer experience. It is down to the age-old problem of divisional self-interest. The IT, marketing and CRM departments have their own objectives, and a customer management project is the ideal opportunity for them all to flex their muscles. While inter-departmental conflict ensues, customers and the brand’s service values are the furthest from anyone’s mind.
Of course, brands could cite the multi-layered approach to delivering excellent customer service to create brand loyalty. The flaw in this argument is that one bad “computer says no” call-centre experience is all it takes to alienate consumers. The damage has been done and no amount of online or offline marketing activity will change brand perception.
The message is clear: consumers want companies to make it easier to do business with them. The paradox is that as consumers become more technology savvy, brands are over-engineering customers out of true relationship marketing and onto a conveyor-belt process. The question is, when they realise this, will the damage be irreparable?
Duncan Painter, managing director of Experian Integrated Marketing, contributed to this week’s Trends Insight