Making Your Customer Care Profitable
The Essence Of Appropriately Conducted CRM Should Be Customer Care
By far and away, the primary focus of savvy contact center/CRM executives is “customer care.” For without customer care, there is no customer to manage by CRM.
In this particular editorial, we would like to discuss the methods and processes by which management can convert a CRM/customer care center into a profit center.
Traditionally, customer service centers have always been regarded as cost centers. In the 80s, when this publication was launched, customer care was not as important and vital as it is today. Back then, believe it or not, many vendors even refused to obtain 800 numbers by which to welcome customer input and provide customer service. I recall many shortsighted business people saying, “Why should I pay for the phone call to encourage my customers’ complaints?” That shortsighted approach cost the misguided vendors a ton of business. Slowly and gradually, the customer got the respect that he or she richly deserved; namely, outstanding customer service became THE source of customer satisfaction without which no company could exist. As I have stated in several of these editorials in the past, companies live or die from repeat business. That is, without an outstanding customer care strategy, no company can exist profitably.
Taking Your Customer Care Program To A Profit Center
Believe it or not, I addressed this topic back in the mid-80s in this, our flagship publication, then called Telemarketing® magazine.
Not only did we cover this topic editorially in this publication, but I also frequently included it in the conference programs of our industry’s leading trade show in the 80s and 90s, which was called Telemarketing and Business Telecommunications™ (TBT). Yes, this was indeed the hot topic back then, and it is a very hot topic even now. The difference is that now, customer care and CRM are backed by sophisticated technology. Today, it has become a very complex project. Among other things, in order to prepare for conversion of customer care centers to profit centers, one would have to develop a functional and practical strategy for the following steps:
1. First and foremost, you need to build, nurture and reinforce relationships with all of your customers. If your company does not have what it takes to manage relationship building with all of your accounts, then at the very least, I suggest that you focus on the 20 percent of the customers that give you 80 percent of your business.
Building a relationship with a customer requires monthly, if not weekly, contact with the account, always offering a helpful idea by which your customer can run his or her business more effectively and/or more profitably. You really need to make a living in providing unparalleled and genuine service to your customers if you truly want the relationship to continue. Always remember that it costs 10 times more to get a new customer than to service an existing one properly.
2. Management must have the willingness and open mind to act on feedback. Many companies, unfortunately, do not like to receive customer feedback. They simply offer an off-the-shelf product and tell their customers to take it or leave it. Obviously, in today’s business environment, there is absolutely, positively no room for companies that think that way. Quite possibly, the company in question won’t be around for a long time.
I learned a long time ago that a mind is like a parachute, it only works when it’s open. Consequently, the successful businesses of tomorrow are those in which everyone at the company has a positive, can-do and flexible attitude. Anything short of that would be a disaster.
3. Conduct focus groups. Frequent focus groups with your customers are extremely useful to help you keep your customers satisfied. Traditionally, focus groups unveil problems with a company’s product or service and, more importantly, such groups generate new ideas that can help the company to solve the deficiencies of the product and thereby ensure business continuation via customer satisfaction.
4. Training is the key. Obviously, in order to convert the customer care center to a profit center, one has to focus on the training of the CSRs (customer service representatives). This neglected group of people is the first contact with your customers and it is where perceptions are formed. And remember: One never gets a second chance to make a good first impression. Accordingly, before you even think of appropriate customer care, you must first think about outstanding — and I mean outstanding — employee care. If anyone at your company is not treated appropriately, particularly your front-line people such as customer service representatives, the dissatisfaction will come through their contact with your customers and that could spell disaster in your CRM activity.
As I have stated in numerous editorials, every company talks about customer care and customer satisfaction but no company that I know, with a few exceptions, talks about employee care and employee satisfaction.
A Success Story From Telerx
Approximately one month ago, I had the pleasure of visiting Telerx (www. telerx.com) and had the privilege of meeting Nancy Gussow Gross, Vice President of Corporate Communica-tions at that company.
The purpose of my visit was to find out how this company is transforming customer care from a cost center into a revenue generator by combining outstanding service with solution-based selling. Indeed, I was extremely impressed to learn that Telerx has actually been able to increase the revenues of a durable goods manufacturer by an average of 20 percent per order compared to the prior year. In addition, the company was able to achieve a 90-percent customer satisfaction rate, a significant increase in product satisfaction. Just as importantly, during the first quarter of integrating a sales component into the customer care program, the increase in contact center-generated revenue exceeded an ambitious goal of 20 percent. Following is some additional information about how Telerx was able to achieve the above objective of profitability.
A manufacturer of food storage products and small electric kitchen appliances had experienced phenomenal growth selling the product and accessories directly, via the Web, toll-free numbers and retail outlets since its introduction in 1987. The company’s premier product is a category market leader.
Early on, the company realized the important role its customer care program played in the success of its brand.
Recognizing that each contact is an opportunity to build — or risk — life-long relationships with customers, the company began to search for a customer care partner. Requirements included the expertise and experience to develop a team of product experts whose interactions would enhance the relationship with its customers and, therefore, its brand. Senior management, committed to obtaining “best-in-class” practices across the organization, was looking for:
1. A strategic outsource partner with a highly developed specialization in customer care and consumer affairs.
2. Documented success in providing consumers with contact experiences that exceed their expectations.
3. Specialized technology with future scope and bandwidth projections.
4. The ability to turn call data into strategic and actionable knowledge.
5. The skill to create a client-focused culture within a dedicated team.
6. A strong commitment to continuous improvement, enhanced service and cost efficiencies.
The result of the search was the creation of a partnership with Telerx.
Taking It To The Next Level — Driving Revenue
Like all marketers, the client company was under increasing pressure to grow revenue. The company looked for help with integrating strategic selling with customer service. Now, instead of just taking orders and making product suggestions, revenue generation is a formal part of the program.
The key to integrating a sales effort and capitalizing on revenue opportunities was maintaining — not compromising — the superior level of service the company’s customers expect. To achieve that goal, Telerx and the client collaborated with a third-party marketing consultant to create a three-pronged approach to the sales effort integration:
1. A solution-selling training program was developed to equip the representatives with the knowledge and skills needed to recognize and capitalize on revenue opportunities. The training also helped these representatives, who had been so focused on customer care, overcome their concerns about selling to customers. Since solution selling hinges on asking appropriate questions to better identify and offer products that meet customers’ needs, representatives quickly felt comfortable with the process. They view it as a way to provide enhanced customer service — not just trying to sell.
2. A sales goal incentive was developed and implemented for the customer service representatives. Under the tiered incentive program, representatives can earn cash bonuses based on the number of machines and/or accessories sold monthly. Since the quality of each phone call is paramount, monthly quality monitoring results are also factored into the incentive payout.
3. The skill sets learned during the solution-selling training are reinforced through monthly quality monitoring and feedback sessions.
Results from the solution-selling initiative have exceeded the company’s goals. During the first quarter of the program, the customer care team generated a revenue increase that exceeded the aggressive goal of 20 percent.
For more information about Telerx, please contact Ron Abel, Executive Vice President, at [email protected] or 800-283-5379.
As always, I welcome your comments. Please e-mail them to me at [email protected] CIS
Executive Group Publisher, Editor-in-Chief