Feature story from CMO.com

Don't Use CRM To Automate Bad Behaviors

Here’s the good news about the state of CRM today: Most companies recognize the financial value resulting from improving their customer experience (CX) and are spending the necessary dollars to acquire CRM technology and build preference centers.

Now the bad news: Many companies are focusing so heavily on their CRM technology that they are losing focus on why they embarked on CRM and preference-center initiatives in the first place--to deliver improved customer experiences.

Two quotes from recent conversations my firm, Ernan Roman Direct Marketing, had with CMOs say it all:

• “I’ve come to the realization that we are using new technology to automate our existing bad behaviors. We will be simply be increasing our ability to do more brand damaging ‘spray and pray’ due to installing the latest high-capacity CRM technology.”

• “We’ve invested millions in new customer engagement technology and just realized that we never actually asked our customers how they define more relevant communications and experiences.”

In the course of working with many Fortune leaders on CX initiatives, we have learned that their major problems have little to do with inadequate CRM or preference-center technology.
Their major problem is; not having an in-depth understanding of how their customers define meaningful customer experiences.

Therefore, we recommend that CRM and preference-center initiatives should be based on understanding how your customers define the customer experiences they want to have with your specific brand and products.

Our recommendation is based on more than 10,000 hours of Voice of the Customer (VoC) research for clients including MassMutual, Norton AntiVirus, NBC Universal, IBM, QVC, and Microsoft. 

Research findings from in-depth interviews with B2B and B2C decision makers indicate that the following six points comprise a competitively differentiating customer experience:

1. Improve the customer experience across every point of contact with your organization. Mike Rude, managing director of customer experience at FedEx Corporate Services, provided this important insight: “Too often CRM and preference-center initiatives focus on technology and process. We work hard to first understand the needs of the customer. This enables us to ensure that technology deployment will focus on delivering the optimal customer experience at every point of contact and every channel important to our customers.” 

2. "Improve the customer experience" applies to all elements of the media mix and all departments in your organization. CRM success truly hinges on effective change management. According to Forrester Research, the top "people" challenges when implementing a CRM solution include cultural resistance to adopting new ways of working (45 percent), difficulties in achieving user adoption (44 percent), insufficient planning and attention given to change management (42 percent), and inadequate leadership (38 percent).

3. High-quality experiences must be maintained throughout the relationship--not just when you are selling. “We need to think in terms of engaging customers at every stage of the customer life cycle. This causes a shift from one-way communications to conversations and thinking about content differently,” said Eric Nystrom, director of Dell’s Social Media Services Group. “Customers expect to engage with subject-matter experts and empowered employees, not corporate spokespeople. Therefore, content needs to be relevant, interesting engaging, and always on.”

4. Customer experiences must be driven by individual preferences regarding message, timing, frequency, and media mix. Said Jennifer Downes, director of direct response marketing at Lenovo NA, “For customers, the preference center is the mechanism to voice how they wish to interact with a brand. For marketers, it allows them to develop a deeper understanding of their customers. That said, the reality is that marketers as business people have metrics to meet, which may be at odds with providing the best customer experience. The key to success is for the marketer to find creative ways to meet these metrics without creating a conflict with the customer's desire for relevant engagement.”

5. Preferences must drive high-quality personalization of communications and experiences. "Based on the learnings from the VoC research, we have fundamentally redesigned the way we look at relationships with customers,” said Kris Gates, vice president of customer experience at MassMutual Retirement Services, who is driving profound changes in customer experience. “Taking a learn-pilot-scale approach to our marketing efforts, we already have several VoC research-based initiatives under way. These range from redefining how we view the customer-focused value of CRM platforms and our data, to campaign targeting and preference based communications. 

6. Privacy of preference information is essential. “Start with the end in mind,” advised Scott Frey, president and CEO of PossibleNOW. “Creating a plan for how the information is collected through the preference center and safeguarded will impact marketing campaigns and customer correspondence.”

Key Takeaways

Jeff Howell, director, subscriber communications and engagement/CRM, at SiriusXM, offered four important takeaways regarding technology, preferences centers, and delivering an improved customer experience:

• Many marketers are missing the full value of a preference center. They are viewing it as a means of fulfilling compliance requirements and capturing simplistic preferences, such as email versus mail, or Product A versus Product B.

• The real value of a preference center is to serve as a portal to engage the customer and capture information regarding issues of importance to the customer.

• Opt-in preference information should enable a customer to define his relationship with the company across multiple devices, channels, and key points in the customer's life cycle.

• “Marketers have to become smarter about using technology not as a silver bullet, but simply an enabler to deliver on a competitively differentiating customer experience,” Howell said. “Too often marketers lose focus on the customer and get distracted by the operational requirements and capabilities of the technology.”

Another takeaway, courtesy of FedEx’s Rude, is to avoid the mistake of becoming enamored by technology’s promise. Focus on understanding what the customer wants and how to use technology to deliver on those expectations, he told us.

We’d like to add one final takeaway: Internal decisions about technology need to be guided by external customer insights. Installing CRM technology without understanding how customers define relevance, engagement, and preferences will simply result in getting the latest technology to automate existing bad behaviors.

Why Isn’t Your Customer Service Better?

Challenge: At a time when good customer service would be assumed to be a core competency, why are so many companies still not delivering good to excellent customer service? What needs to be done differently?

Here’s how things went in my own recent experience with a major online movie-viewing service;

Abrupt email from the company:
What is the problem and how would you rate our customer service? 

My Reply:
I entered my credit card information into my account several weeks ago. I still cannot charge a movie.

My original request was on February 25. Today is March 15. No one ever responded to my repeated emails and voice mail messages.

Given the above, how would you rate your customer service?

They never replied.

Based on similar instances we have all experienced, following is a question every company should consistently ask themselves; “Why isn’t our customer service better?”

According to a Forrester study, “Top Trends For Customer Service In 2014” the following are high-value areas for customer service improvement;

• Anticipate the what, when, where and how for customers, and prioritize information and functionality to speed customer time-to-completion.

• Investigate methods to recommend “next-best actions” during the service resolution process to offer service tailored to the customer’s unique needs.

• Make experiences consistent. Forrester observes that 60% of companies gather feedback about their interactions with a company; however only 33% analyze customer insight across organizational boundaries.

According to a Tempkin Study, What Happens After a Good or Bad Experience, 2014, it was noted that:

• More than half of the customers who encountered a bad experience… either decreased their spending with the company or stopped altogether.

• Data shows that a good service recovery effort can help mitigate a bad experience. Unfortunately, many firms…aren’t very good at service recovery.

• After a bad experience, 60% tell a friend directly, 31% share on Facebook, and 20% write a review.

5 Takeaways

1. Understand what customers want in a good customer service experience. How do our customers define good customer service? If you do not fully comprehend what customers want from you, it is impossible to deliver a good experience.

2. Regularly monitor practices to be sure that they are in line with current customer demands. Are your customer service policies outdated? Set a regular interval to monitor your company policies and employee practices to be certain they meet the expectations of customers.

3. Get buy in at all levels for your customer service initiatives. It does not matter how many policies are put in place if these policies are not put into everyday practice at every level and every point of contact within your company. Consistency in customer experience is key.

4. Develop a “listening” strategy to monitor customer conversations. If you do not know what customers are saying about your company it will hurt you. If you do not have a social media team now is the time to start one. Active listening will allow you understand the challenges that customers face and respond quickly.

5. Make contact easy. Are customers able to contact you for service related matters across all channels? If not, then expand your accessibility. Customers do not want to work to find solutions to their problems or get their questions answered.

Is Your Customer Service Multichannel?

The Challenge: Just as businesses must provide customers with a wide variety of marketing channels to choose from, they must allow a choice of multiple service channels.

As we've discussed previously, multichannel marketing enables delivery of messages per an individual's media preferences. Some customers want to engage businesses on social media, others want to receive email, and significant percentages still prefer direct mail.

If you focus on a single channel at the expense of others, you're neglecting a significant portion of your customer base. The same holds true for customer service.

ESSENTIAL CUSTOMER SERVICE CHANNELS:

Phone
American Express has recently demonstrated the amazing value of high-quality phone service. Outstanding service leads to increased revenue and shareholder value. But not every business can enable 24/7 phone support, and not all customers want to engage on the phone.

Email
Service operations shouldn't try getting customers off the phone as quickly as possible, but customers should have the option to handle issues without much engagement on their part. In those cases, the most popular alternative to phone support is email.

Important new workshop Customer Experience Marketing: 5 Steps to Ensure Success developed by the DMA & Ernan Roman. Click to learn more.

Live Chat
SMS text and online chat are a part of nearly all your customers' lives. Implementing Live Chat integrates this convenient customer option. Be sure your customer service team learns from the valuable Voice of Customer (VoC) data in the form of session logs.

Social Media
Regardless whether your business is on major social media platforms like Facebook and Twitter, your customers are—and they're talking about you. Don't lose control of that conversation. Lead it.

Product Guides and F.A.Q.'s
Sometimes customers simply want to help themselves. For their sake, make sure that your online documentation is current and comprehensive.

BEST PRACTICES FOR MULTICHANNEL SERVICE:

Let Customers Prioritize Their Channel Preferences
Many businesses enable multichannel service, only to bury their phone number while placing a link to their F.A.Q.'s on every page. This should be the customer's decision, not yours. Give customers their choice of service channel by prominently displaying every option on every page of your site.

Enable 24/7 Customer Service
For many businesses, the marginal value of 24/7 phone support may be too low to justify the additional cost. But, customers should be able to engage your service team any time of the day—even by just sending a question. Enabling multichannel service allows them to do so.

Be Clear and Accurate About Response Times
Effective call center operations include wait time estimates, a form of transparency that significantly reduces customer frustration. The same should be true of all your service channels: immediately send customers an automatic response from all channels, and include a clear and accurate statement of when they'll get an answer to their question.