Are You Being Served?

With the activity on the Web last Christmas, it became evident that consumers were beginning to embrace the notion of shopping on the Internet. And though Internet retailers were able to rack up an estimated $7 billion in sales, it pales in comparison to the estimated $12 billion in sales that will be racked up in 1999, and the projected $41 billion anticipated by the year 2002.

However, the 1998 Christmas season also highlighted a number of weaknesses among web retailers in the area of customer service. Site outages, lost orders, and murky return/exchange policies were just some of the frustrations that on-line shoppers faced. If there was one lesson that retailers learned last Christmas, it was that providing customer service on the web was more than just having a web site, providing an e-mail address, and perhaps a list of frequently-asked questions. In a number of cases, it seemed that no one was being served on-line.

Though a recent Yankee Group survey uncovered that the majority of companies currently handle less than 10% of their customer requests on-line, Forrester Research estimates that e-mail and web-based communications are expected to account for more than 70% of customer contacts in the next two years. Furthermore, as the web becomes more pervasive in society, web-savvy early adopters are being supplanted by an increasing number of mainstream shoppers who are less tolerant of shoddy service and require more handholding through the buying process. Even now, 46% of web consumers will leave a preferred site due to technical problems or delayed service, according to a Jupiter Communications study. And with an on-line marketplace becoming increasingly crowded with both branded 'real world' retailers and new 'pure play' Internet upstarts, businesses can no longer afford to treat customer service as an afterthought. Businesses that learn how to provide a consistent level of high-quality customer service on-line will benefit from higher customer retention, reduced costs, and improved market share at the expense of their less service-savvy competition.

Unfortunately, the situation today is far from ideal. Very few businesses have taken a long hard look at their entire supply chain and its ability to weather unexpected surges in customer demand. For example, one overlooked aspect in the realm of on-line customer service is e-mail, which is currently used as a customer communication by 98% of businesses doing business on the Web. However, many of these businesses are managing their e-mail handling in an unstructured environment with no clear lines of responsibility, numerous manual handoffs, and few guidelines or metrics by which this customer service function can be effectively governed.

Not surprisingly, when Jupiter Communications posed as consumers and sent e-mail questions to 125 top web sites this past January, 15% took five days or more to respond, while 26% of the sites failed to provide any sort of response. All in all, only half of the sites managed to respond in less than one day. In a shopping environment perceived by consumers as faster and more responsive, which group would you want your company to be a part of?

Another hindrance to providing good on-line service is the 'silo' architecture of a company's information systems and processes. Information sharing between the different functional areas that touch the customer (such as sales, distribution, and customer service) is often slow or non-existent due to different systems and a lack of integration between them. Today, the most common methods of moving customer data between different functional areas are through batch processing or manual re-entry. For example, completing an order form at some on-line stores will generate a printout at the other end, where a customer service representative (CSR) will manual key the order into a fulfillment application. And for businesses that have both a web-based and bricks-and-mortar presence, there are few that put in place processes that allow customers to move between the firm's web site and its stores to conduct transactions such as refunds and exchanges.

To succeed in the provision of customer service on-line, there are a number of things that a company should take into consideration:

1. Solve problems before the customer even realizes what they are. Be pro-active when designing your site's structure and content, as well as the offering itself, with the intent of pre-empting any possible customer queries. For example, by providing easy-to-find and easy-to-understand information on products, shipping, returns, and warranties, you negate the need for the customer to query in the first place. Sending timely updates via e-mail, such as the status of a customer's order, will also help to allay any anxieties that would usually prompt a customer to contact you.
   
   Similarly, ensure that both your site and your backroom processes (such as the shipping department) can handle the anticipated volumes and that there are processes in place in the event of failure (such as directing customers to a 1-800 number, or e-mail updates warning of delays).
   
   And finally, try to dialogue with your customers as often as possible by soliciting their feedback, not only on what your company did right or wrong, but what it is that they need, want, and value. If done correctly, this can be a powerful tool for driving customer intimacy, since you are finding out exactly what makes your customers tick and what your brand means to them.
2. Take a long hard look at your entire supply chain, from your suppliers to your web storefront to your shipping department, and critically assess your ability to handle unexpected surges in demand. Will your business be able to cope? If not, what processes do you have in place in the event of failure (such as directing customers to a 1-800 number, or the ability to notify your customers of shipping delays)? Do you have processes in place in the event of a customer problem (lost orders, refund/exchanges, complaints)?
   
   Finally, do you have an all-out recovery strategy in the event of an unsatisfied customer? For example, if an order is delayed by several weeks, are you simply going to ship it to the customer a month late at the full shipping rate without a word of apology, or are you going to do whatever you can to keep them as your customer?
3. Elevate web-based customer query-handling to a core activity, if you have not done so already, by folding e-mail and web-based query handling into an existing call center and establishing standards for handling such queries. In some cases, when you are responding to thousands of e-mail queries per month, it may even make sense to spin-off a separate e-mail call center. By providing routing and workflow structure to web-based queries, you will ensure that each customer, whether from the web or from the phone, will receive the same level of service.
   
   To assist in such an endeavor, there are a number of applications that can provide your CSRs with a single interface for handling both web-based and traditional queries. These products, such as Internet call center suites offered by Lucent and WebLine, not only prioritize incoming telephone calls, e-mails, and faxes, but also provide other means by which your customers can contact you over the web, including 'call me' buttons, 'live' text-based chat, 'guided' surfing, and Internet telephony. Furthermore, the CSR is provided with a single screen containing all the relevant information needed (such as customer information, knowledge databases, and scripts) to resolve the customer's problem.
4. Qualify customer queries up-front, such that they can be immediately be prioritized and routed to the correct person or functional area for handling. This can be achieved by using web-based forms or by providing distinct e-mail addresses for different types of queries, as opposed to using a generic e-mail to a generic e-mail address. NationsBank, which handles hundreds of e-mails per day, uses a Lotus Notes-based application that scans the content of incoming e-mail and automatically routes it to the right person for handling.
5. Provide automated interfaces for your customers to use for more commonplace queries that require little or no human intervention, such as forgotten passwords, order status, technical problems, or catalog requests. For example, BancOne, using Lotus Notes workflow tools, has created a number of self-service applications on the Web that allow customers to check account balances and conduct common transactions. Using applications such as ServiceSoft's Knowledge Builder and Web Advisor, companies can create their own self-service knowledge bases that can handle the most commonly encountered queries. Similarly, intelligent auto-reply e-mail responders, from vendors such as Aptex and Brightware, can generate simple answers to basic questions, answering 50% of inbound e-mail with 90% accuracy, by looking for specific keywords in a customer's e-mail query.
6. Regardless of how you interact with your customers, keep in mind that even though your business may not run around the clock, your web site does, and there is a good chance that the customer going through your site at 10pm on a Friday night may need assistance. Both AOL and Wm. Grainger have found that 40-50% of their web orders after 5pm and before 10am. What are reasonable times for your business to keep 'office hours'? What happens to your customers that need assistance outside these times?
7. If you sell to your customers both on the Web and in the 'real world', coordinate customer interactions through both channels, such that a customer can get the same level of service whether they go through the web, go to a store, or call on the phone. To the customer, your web site, call center, and stores are all the same, and they will choose one over the others based on convenience and how critical the problem is. This, of course, means coordinating customer information across multiple channels. This would then allow a web order to be manipulated at the store level in the event of a refund or exchange, or allow a CSR at the call center to pull up all the necessary account information in order to resolve a web order complaint.
8. Finally, begin measuring customer service effectiveness as a means to monitor both customer satisfaction and costs, as well as identifying possible problem areas. Mining problem tickets, using exit polls ('Are you satisfied with the answer to your query?'), counting self-help page hits, and monitoring e-mail turnaround time will highlight opportunities for increasing customer satisfaction and streamlining customer service processes.

The Internet as a sales channel provides tremendous opportunities for businesses to increase reach, capture incremental sales, reduce or stabilize the use of more expensive channels, and forge stronger relationships with customers. However, much work remains in the area of effectively servicing customers through the Web, which was evident during the 1998 Christmas shopping season. If you are not consistently providing high-quality service to your web-based customers... somebody else will.

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