[June 10, 2005]

SMB Service Still Sucks (Sigh)

By David Sims, TMCnet CRM Alert Columnist

You’d think that the one thing small and medium-sized businesses would have going for them would be that they can focus on customer service more than the big boys.

However, in the first eService benchmark study focused exclusively on small and medium-sized businesses, BenchmarkPortal, a source of CRM best practices for contact centers, found that online customer service provided by SMBs is even worse than the service level offered by large enterprises.

This is the second study in the State-of-eService Benchmarking Series sponsored by eGain Communications Corporation, a customer service and contact center software vendor.

The first study, released in August 2004, focused on 300 enterprises in the US and Canada with more than $250 million in annual sales. The goal of the second study was to assess the state of eService in SMBs with annual revenues between $10 million and $250 million. Conducted in early 2005, the study evaluated 147 SMBs spanning the retail, travel and hospitality, financial services, e-business, and hi-tech manufacturing sectors.

Posing as customers, researchers made targeted e-mail inquiries that demonstrated a clear intent to buy a high-value product or service. Both the timeliness and the quality of the responses were measured.

The study found that many North American businesses are missing out on revenue opportunities due to poor or non-existent e-mail customer service. Among key cross-industry findings are:

• A “shocking” 51% of the companies did not respond at all, versus 41% for enterprises.
• 70% of the companies failed to respond within 24 hours, versus 61% for enterprises.
• 79% of the companies responded with an inaccurate and/or incomplete answer. Here, SMBs performed better than enterprises, where 83% of the companies responded with an inaccurate and/or incomplete answer.

Among industry-specific findings, the highlights are:

Responsiveness:

• The ebusiness sector performed the best in responsiveness, with 52% responding within 24 hours.
• Surprisingly, the financial services and retail companies were the least responsive, with 72% and 60% respectively not sending any response at all.

Quality of response:

• The travel sector performed the best, and even in this sector, two-thirds of the companies provided inaccurate and/or incomplete answers.
• Financial services again performed the worst with 89% of the companies providing an inaccurate and/or incomplete answer. High-tech was the second worst sector with 86% of the companies providing an inaccurate and/or incomplete answer.

"E-mail is a vital channel for gaining and sustaining customer interest and loyalty," said Dr. Jon Anton, a contact center consultant and director of research for BenchmarkPortal. "The fact that 51% of North American small and medium-sized businesses are simply ignoring e-mails from high-value buyers is shocking.”

David Sims is contributing editor and CRM Alert columnist for TMCnet.