Improving experiences for the most demanding customers

The summer has been hectic with customer  deployments, balancing work and personal life, kids and businesses. With all things happening here and there I neglected writing, even with all those extra time on long flights. Now finally on a flight between Kuala Lumpur and Manila and have time to write about demanding customers. Customers who demand for the best, they are everywhere, like you and me. There have been a few surprises in exceeding customer expectations and there are bad misses. Let’s take SAS as an example, on a  flight to Stockholm the stewardess started singing, entertaining the entire flight, it was short flight but then again, they exceeded expectations. On the flight back SAS lost my luggage, then promised to send it to my flat after it arrives on the next flight. The bag arrived at the airport but they were not able to deliver since they can’t find my flat and only got it 8 hours later. Now I wonder if SAS delivery spend 8 hours finding my flat in a small city, how lost can they be in running an airline business and much more lost in delivering good customer experience.

The most demanding customers today can be found having mobile phones, of which they demand excellent services in every way. From providing voice services where the expectations is zero dropped  calls, very fast data speed and excellent customer service. Every mobile operator in the world strives to provide the best quality of service to their customers, however not all of them succeeds. In my previous post I talked about several apps on the market today that allows a mobile phone user to test their services and share it on the net. The question in doing that is what benefit is it to the actual user? Does it give him/her a better service? Or do he/she use it to justify moving to another service provider. It is true that service quality is a big driver in churn, however is much more than a slow data in a particular area, its all about the overall experience from services provided to interaction with a service personnel.

Now imagine, instead  of calling your service provider to complain about bad services or bad experience, would you rather simply tap your phone and it takes care of the rest? Including getting updates about the bad service you experienced all the way to getting if fixed. In this way we can demand of better service, we can demand of faster response and faster resolution, we can demand of being in the know, we can demand of the correct fixes instead of  customer service agent simply selecting the top 10 answer on their list of issues.

If a service provider is able to meet our demands, what's next?

Measuring RoI of Customer Happiness...

Every sales or marketing or customer service or engineering initiatives has a cost and reward associated to it. For any company the rewards or benefits should outweigh the cost for it to be adopted by the company's' management. But what happens when it comes to customer experiences, are any short term benefits that can justify immediate implementation of a customer happiness program? Or its long term advantages and what is the most effective way of measuring Returns on Investments (RoI)?

In the financially driven world of business RoI is measured by

• Revenue generated
• Cost Saved
• Profit made

Having said that what is the best way in measuring the RoI of a CEM program? First off we need to understand why a CEM program is put in place... The general answer will always be to keep customer happy and satisfied. However beneath that very general statement are underlying business cases such as:

• Lower number of customer complains.  Just imagine every customer complain can cost say 5$ and if there are 1,000,000 complains avoided every year, that's a 5,000,000$ savings
• Lower the Average Call Handling Time. When calling customer service just imagine how much time is wasted going through the IVR then a long interview with a customer service agent. What if you can reduce this by let's say 1 minute? In an average mobile operator the cost of a customer service call is around 1$ per minute, now consider the 1,000,000 complains where every call handling time is reduced by 1 minutes, that's a 1,000,000$ savings.. In the real world the savings can be as much as 10 minutes
• Improve First Call Resolution rate. For every customer service organization resolving customer issues at the very first instance they complain is very important. Let's just say it will cost 5$ per every complain that is not resolved by first line support so if all the 1,000,000 calls goes to 2nd line support that's a 5,000,000$ cost that can be saved if complains are resolve the first time around.
• Lower Churn rate. Let's just say out of those 1,000,000 callers, 2% churns or departs as customers. That's 20,000 customers, and let's just say they ARPU is 100$ per year that's 2,000,000$ in potential lost revenue saved.
• Increase service usage. Happy customers normally use more services. Let's say as a mobile operator you offer data services for 5$ per month with 1 GB of data, with your customers being happy say about 1,000,000 customers upgrade to 10$ a month. That's an additional revenue of 120,000,000$ per year.
• Deploy wanted services. What a good CEM program will show you are future services that your customers will take. Let's just say your customers move to WiFi every time they use Facebook, now if you know this fact why not offer your subscriber a 1$ a month Facebook usage using your network. For 1,000,000 users who will subscribe to the service that's an additional revenue of 12,000,000$ per year.

There are of course a lot more potential savings and more potential revenue generated with the right solution. Having said that there will be more examples to learn from in Dubai for the CEM Summit  next month. This same topic will be discussed by David Perrota  of Zain, Liz McSorley of Du, Nedal Mostafa of Ufone and Ahmed El-Bana of Mobily.

This group of industry experts will be exploring:

• How to you use the results of your ROI analysis to make the customer experience a strategic priority at a time when all departments are competing for budget?
• How to you monitor and strengthen the link between customer satisfaction, recommendation rates and customer acquisition?
• How to you ensure that your customer experience improvements will increase ARPU?

Now I am tempted to attend....

Will Customers Ignore Bad Customer Service?

In competitive industries a bad customer experience results to churn (telecoms, media, etc). How about in hotels? Hotels are supposed to deliver the best customer experiences considering that Four Seasons set a trend several years back… This week I have very interesting customer experiences, of which a lesson can be learned. In a very large city I stayed at Le Meridien, the experience with the hotel staff and facilities were very pleasant and the price fits the companies travel budget. That set my expectation in the days there after. I arrived in Dubai with a similar expectation, booked a room at Emirates Grand Hotel (which is twice as much as I paid in Le Meridien) and was very disappointed. First off I was told I was told to pay the entire amount of my stay in advance and asked for my passport very rudely… the front desk personnel looked at customers with dubious suspicion, its the first time in many months that I have encountered such a sour and unfriendly staff in the front desk. Considering that the front desk staff is Filipino (who are known for excellent service and hospitality) I am very disappointed. The since I have to wait for the room to be ready before I can dress up for an early meeting (which I missed) I was hoping that the front desk staff will offer for me to wait somewhere convenient…. However after charging my credit card (the amount that I could have stayed at Four Seasons) I was ignored completely.. To my dismay I have to find someone else in the hotel to ask where their restaurant is and at least sit there and wait painstakingly…. Indeed a very painful experience… Anyway this first impression means I will not be a returning customer to the Emirates Grand Hotel….

I did have bad experiences in better hotels like Hilton (room not ready on time, worm in fruits). However in both cases the hotel staff apologizes and offered to compensate me for my troubles (free stay, free food, etc)… I continued to stay in Hilton considering that the bad experienced are offset with the apologies and friendliness of the staff… Something that I sadly never saw in Emirates Grand Hotel.

The question is in Telecoms, how many bad experiences does subscribers tolerate before they churn and move to another operator? In some countries subscriber churn immediately, especially young pre-paid users….