Online sales means quick response CRM systems

Retailers hoping to increase online sales need to develop CRM systems that are able to respond quickly to customer queries and keep a one-to-one dialogue going.

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“Our customers can have a very short decision-making process so we need to respond on their timeline. If we don’t, we potentially create a demand that a competitor can fulfil,” warns Honda UK’s marketing communications manager for power equipment, David Hodgkinson.

However, the number of brands that make responding to consumer queries a priority is surprisingly low, according to a report by the Direct Marketing Association (DMA), shown exclusively to Marketing Week.

It shows that only 35% acknowledge consumers’ emails and 29% collect information from enquiries to use for marketing in future. But for Hodgkinson, use of social media means that people expect a retailer or brand to respond to queries in real time.

“Email has opened our eyes over the past few years to the fact that customers want information and answers to their questions quite quickly. The rise of email and social media means the timeline [for responses] is getting shorter.”

For brands, this means having the resources in place to be able to respond to customers when they want, Hodgkinson advises.
But it’s not just about being able to respond to queries. It’s about being able to continue conversations with them to build relationships, and, ultimately, sales. However, retailers admit that it is hard to build up a decent picture of potential customers.

Online retailer Play.com, which has recently been taken over by Japanese ecommerce operator Rakuten, is working on its customer relationship management (CRM) system to build up a single customer view, explains its marketing director Adam Stewart.

“It takes time to build up a sophisticated CRM system, which gives a clear view of one-to-one customer interactions. Today’s digital customers are faced with information fatigue and overloaded inboxes. Play.com is working hard to advance its CRM to get to a one-to-one communication strategy,” he says (see Q&A, below).

Understanding what the customer wants and having the right resources in place to respond to those needs is something that Hallmark Cards International is hoping to get right with the launch of its transactional website using provider EPiServer.

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Hallmark cards: Making an effort to deal with online customer efficiency

Gavin Masters, ecommerce delivery manager at Hallmark Cards International, says it is working hard to make sure customer queries are dealt with efficiently. He says: “We have a large customer service team which will be able to help consumers with the new platform and the new questions and issues that brings. Constant communication between departments will be key. Every piece of customer feedback will be looked at to see where we are succeeding and where we need to improve.”

However, Masters wants to reduce the need for people to contact its customer service team and for them to be able to help themselves via the website.

“Along with many online businesses, we need to work hard at reducing the need for customers to contact us for help. If they can resolve the problem within a couple of clicks or using our FAQs facility this can mitigate the frustration they might feel.”

Some brands are using instant chat to help customers quickly. Honda Lawn and Garden is working on using call centre staff to handle queries and may ring someone up to help them if they have been speaking to them via instant chat online.

“Our website uses algorithms looking at users’ behaviour. When they have been on the site for a period of time and are looking at certain pages, we can see that they might not be finding what they are looking for. Then a box will pop up to ask if they want to go on to messenger [with a member of customer service],” says Honda’s Hodgkinson.

Honda can track these interactions to sales for its cars and other vehicles that have to be registered with the DVLA, but matching up customer service responses with sales is harder to do for garden products.

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“However, we have done some customer service indexing and we saw that people can purchase very quickly from their initial contact, so that is the rationale that is making us respond as quickly as possible,” says Hodgkinson.

Companies that are slow to respond to sales queries may be missing out, according to the DMA’s research. Half of companies respond to email enquiries for hard copy brochures to be sent to them within five days, but some take as many as 40 days to mail brochures.

“The minute you put the opportunity to request a brochure out to consumers you have got to be geared up to satisfy that requirement,” says Jo Varey, chair of the response management council at the DMA. Varey claims that brands may focus on other areas of marketing.

“It seems that a lot of brands are focused on the sexy marketing piece or the TV ad but forget about the logistics of getting that into a customer’s hand.”

Naked Wines, an online retailer that puts buyers in touch with wine producers, says that responding to customers is crucial, especially because of the value of what it sells.

“We treat any customer contact, good or bad, like a gold nugget, because it is a valuable opportunity to build a real human relationship,” says founder Rowan Gormley.

He says a quick response can turn a disgruntled customer into an advocate. “We have hard data to show that customers who have had a problem resolved are more loyal, more valuable and more likely to refer their friends than customers who never had a problem in the first place.”

Case study: Honda UK

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David Hodgkinson
Marketing communications manager (for power equipment)

Honda UK

We have a vast product range, which includes lawn and garden products, marine outboard engines, quad bikes and generators as well as cars and motorbikes.

There is cross-fertilisation [for customers of] those products, so we try to have a pan-brand strategy. When a customer comes to us we look at them across the product groups. For example, if they have bought a Honda Accord Estate, they might also match the type of profiling for a ride-on lawnmower.

We send subscribers an email newsletter every six weeks. The content depends on the type of person we perceive the recipient to be from their demographics, so the content will always be relevant to the purchases they have already made.

We also find it’s not just the email but the way we structure the content, so we try to make it a mix of brand stories, product info and offers. We’ve found that if you go in with offers too fast or too often then you turn the customer off, particularly when customers are becoming increasingly savvy with the world of digital.

They are getting quicker at being able to decipher what is put in front of them and being able to decide whether it is a relationship and a brand they want to pursue.

We try to tie content together across the company. It is very easy for one person in the business to only talk about one particular product but the consumer doesn’t perceive us that way. They perceive us as a single brand, so we have to be consistent in the stories we tell.

We also try to layer our advertising in three ways. We’ll have something brand focused, will talk about product benefits and then use offers, such as finance or cashback.

With email in particular, it is fine to push out the communications at customers but what we have found challenging is putting the facilities and resource in place to back that up.

If you are communicating digitally, be that via email or social media, the amount of time between when customers expect the first response and then a second is getting shorter and shorter.

Fact focus

Ways to convert online enquiries into sales

  • Despite many retailers having an online store and there being many ecatalogues available within those retail websites, a significant proportion of consumers still want to look at hard copy stock lists and catalogues.
  • Consumers want information quickly and may go to a competitor if they don’t find what they are looking for or don’t get a speedy response.
  • Brands are working on linking online enquiries with offline sales. Some categories will find this easier than others, such as cars which have to be registered.
  • Handling complaints well can make customers more faithful to the brand. A poor customer experience can be transformed if dealt with effectively.

Q&A

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Adam Stewart
Marketing director

Rakuten’s Play.com

Marketing Week (MW)/ How does Rakuten use email in its marketing for Play.com and how else does it communicate with consumers across all of its brands?

Adam Stewart (AS): In the past, Play.com relied heavily on email alone to communicate with its customers. However, since its acquisition by Rakuten in November last year, the strategy has shifted to a more holistic multichannel approach, which takes into account social and mobile channels too. We are developing a segmentation tool, which will help us better understand the customer and their preferred channels.

MW: What is your attitude to customer service and how do you respond to customer queries?
AS:
Like most retailers, we understand and share the view that in an ideal world, customer services would not need to exist because customer experience would be flawless. Our goal is to provide the best possible shopping experience for every customer, every time so we need to listen and react carefully to their opinions, good and bad.

Our focus in the coming months will be on creating as many brand touchpoints as possible in order to improve our customer experience.

MW: Rakuten has recently acquired Play.com. What challenges do you have?
AS:
One of the challenges we are currently tackling is creating a single customer view. We are working to better link outbound and inbound communications so that unique customers can be identified across multiple channels and businesses.

Linking data systems across businesses is a complex process, but we understand that to better engage our customer Play.com needs to understand each customer’s full brand journey, not just part of it.

MW: According to a DMA study, 35% of brands did not acknowledge customers’ emails. What’s your view of that?
AS:
It is certainly surprising that 35% of brands did not even acknowledge customers’ email. Ultimately, if you give the customer the option to contact the customer services team via a certain channel you need to ensure that channel functions effectively.

Top trends
2012 predictions

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David Hodgkinson
Marketing communications manager (for power equipment)
Honda UK

We have seen a trend over the past five years where hard copy requests for brochures is declining and downloads of brochures is going up. Overall, there is a continued demand for product information.

Part of the demand for brochures is that the customer will still want to be able to dictate their own timeline/ yes they may have a question and want an answer, but they are going to seek information in their own time. So, it is about being able to give them the answers when they want and guiding them to where they go next from the brochure or email, to the dealer or the contact centre.

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Jo Varey
Chair of response management council
Direct Marketing Association

The majority (61%) of consumers in developed countries do not want to engage with brands via social media, according to a TNS report. So for this year, the art will be integrating social media and making it complementary to traditional channels.

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Adam Stewart
Marketing director
Rakuten’s Play.com

Consumers will continue to spend a huge amount of time on social platforms, most notably Facebook. The transparent nature of these sites encourages quick resolutions from brands and will drive the popularity of these channels with consumers. Play.com’s Facebook page has an area for direct communication and we aim to respond quickly and effectively.

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Gavin Masters
Ecommerce delivery manager
Hallmark Cards International

I think more companies will be going down the ‘self-help’ route. This will probably be supported by social media – Twitter and Facebook provide a platform for supporting someone having difficulties that seems to be as good as the live chat available on a lot of sites.

You also have the benefit that other customers may often assist with a query if they can help, which adds confidence that others are happy with your brand.

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