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Being digital does not mean getting rid of the call centre, nor is it about keeping costs down.
With the economy picking up, organisations need to embrace being digital by default. Examples like the DVLA's digitisation of vehicle tax disc renewals shows what is possible when the customer is put at the heart of the business process and customer experience is given a top priority.
Speaking at the CW500 Club event in June, Mike Havard, director of customer management consultancy Ember Services, described how a fast-moving consumer goods (FMCG) company redeveloped its call-centre strategy and created a far higher level of interaction with its customers.
Describing the company's transition, Havard said: "Alcohol and nuts are not just the menu for a great party – they represented half of the helpdesk queries at this FMCG company two years ago. Now it receives virtually zero calls relating to alcohol and nuts."
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Handling call-centre enquiries
Recognising that its customers wanted to verify that food products contained no alcohol or nuts, the company moved these simple enquiries into a self-service digital domain, he said. "Now it takes much longer calls, like 'my son has just sprayed deodorant in his eyes' from a hysterical mother."
The lesson is not limited to FMCG companies, said Havard. "A common theme across all our clients is trying to understand what is going on in the customer space and how does this fit into their understanding of how to manage customers," he added.
Havard believes the process of dealing with customer queries is changing. For instance, a few years ago, National Rail used to have the busiest call centre in the UK. "Now just 2% of queries go through its call centre, even though the volume [of enquiries] has increased," he said.
The contact centre can become a powerhouse for growing the business or building the brand, said Havard. "The mindset to date has been about keeping cost down, but in a growth agenda, you need to take a different stance if you want to cross-sell."
So businesses need to address customer service efficiency, and become digital by default. At the same time, said Havard, companies need to recognise that concepts such as self-service websites do not remove the need for call centres, which will still be around.
The challenge is clearly one of cost, said Havard: "The board is being challenged to spend more money at a time when they thought they might be getting more cost-efficiencies."
For instance, a business may choose to outsource its call centre because the outsourcer has promised to transform customer service. But Havard believes such transformation is not possible unless the outsourcer owns the whole customer journey. And a deeper outsourcing relationship will be more costly than one that merely handles calls.
Social media is a powerful force for the digital customer, said Havard. He gave the example of an online retailer that did not want a call centre, but then its customers complained on social media. For every complaint, the retailer lost two potential sales, he said.
The end-to-end customer journey revolutionises businesses, said digital and social media consultant Hugo Pinto.
"The digital customer is at centre of everything," he said. "It changes the way customers interact with brands, it has changed they way they shop and the way they visit stores and how they consume information."
For example, a digital customer shopping in-store will check reviews online. Also, when someone is watching a programme on a tablet, they may get home and continue watching on a laptop and engage with the programme through social media.
The board is being challenged to spend more money at a time when they thought they might be getting more cost-efficiencies
Mike Havard, director, Ember Services
"Companies sometimes find it difficult to define the range of priorities to reach the digital customer," said Pinto. "Businesses used to talk about digital as a different set of activities."
He urged companies to break out of the organisational silos they have created. "Get the holy trinity of CEO, CFO and CMO talking about what the organisation will look like in 20 years," he said. "Transformation is key."
From an IT perspective, the CIO and IT leaders need to focus on cloud computing, the user interface and data, said Pinto.
"Experiences are everywhere and in real time. Content can be consumed anywhere, at any time and from different devices. So you much make sure that everything is adjusted to that experience."
The cloud allows companies to synchronise the experience of a single user across devices and maintain context, he said: "Consumers expect this because it is how they use technology. I can call you instantly or share a document immediately in DropBox."
Turning to data, Pinto said: "Analytics helps you understand the business and quantify reality. You can understand the customer and see how to make better decisions."
For instance, train operators cannot count how many people are on the train, but data can be used to close this gap, he said.
Getting this kind of data requires customers to agree to having their location monitored, said Pinto: "It is all about explicit consent."
JC Mighty, head of audience development at Mail Online, described how the newspaper publisher was able to use the data it collected to improve the way it marketed to its readers.
"We have 12 million unique hits a day," he said. "Our biggest challenge is how we understand them."
The Mail Online created a four-pillar consumer hub to enable the sharing and use of data. The hub supports customer insight and CRM (customer relationship management) which are used to enrich the data, which drives additional revenue. The interactions a reader makes on the Mail Online websites are used to improve the company’s understanding of the customer.
"If someone is looking for a holiday or a property, the interaction is consolidated to provide more relevance," said Mighty.
For instance, by knowing someone has booked a holiday, the Mail Online hub can offer the customer relevant targeted financing. "If a customer books a holiday via Teletext, they will get an email with holiday insurance [offers]," he added.
The dashboard infographic has been developed to present commercial opportunities in a clean and simple format
JC Mighty, head of audience development, Mail Online
The more a customer interacts with the Mail Online websites, the more behavioural information the company can collect, said Mighty. This forms the basis of its CRM system. "We have a massive dashboard with big data," he added.
Making sense of all this data is a challenge for many organisations, but Mighty believes there is no such thing as too much data. "What you can have is filter failure," he said.
So instead of presenting all the data, Mail Online's solution is to build a simplified dashboard, he said. "The dashboard infographic has been developed to present commercial opportunities in a clean and simple format."
According to Mighty, the most important consideration when gathering data is to ensure its relevance. “What does your business need from the customer?” he said.
For Mail Online, data collection is about gathering a rich data set that can be corroborated with people’s social media activity, said Mighty. The software within the Mail Online hub can calculate someone’s worth in terms of viral marketing. This viral measurement is not simply based on counting how many connections the person has, but it also takes into account referrals. The joined-up nature of the Mail Online hub means it can target someone on email based on that person’s social media activity, he added.
Convincing the board
Another challenge organisations face in engaging with the digital customer is convincing the board. Testing two scenarios, as in an A/B test, is the way Pinto demonstrated that Facebook would be a more effective platform for targeting marketing campaigns than MySpace, when he worked at broadcaster MTV in 2005.
At that time, MySpace was the dominant social media platform, but on measuring the effectiveness of both campaigns, Pinto said Facebook had 10 times the impact of MySpace.
Havard said the board "responds to emotion". He suggested playing back a call from an irate customer to the board to show senior executives why the company is failing to cope with its customers.
Being focused on the customer is essential, Havard warned. "Last year, the value of ignorance was calculated," he said. "RyanAir was doing something right two years ago, but in Q4 last year it saw a 28% drop in its share price."
The company rated the lowest brand for service and also issued a profit warning, he said. Meanwhile, EasyJet saw a 50% rise in profit, which can be put down to its long-term customer value, such as offering seat booking.
At Mail Online, Mighty said his biggest challenge was to get publishers to understand how social media worked. "Social is like a coffee shop across the road from your supermarket [your own business]," he said. "While the supermarket does not own the coffee shop, it can interact and influence customers."
Where digital customer engagement is used effectively, a business can out-behave its competitors and consumers will become an extended part of the marketing team, he said. Mobile virtual network operator Giffgaff, for instance, has built a community where users can share knowledge and advice.