Business Analytics

By Bob Violino  |  Posted 2012-05-24

By Bob Violino

The way customers interact with companies is changing dramatically, largely because of the rapid emergence of social media and mobile devices. At the same time, consumers—thanks in part to the Internet—have become much more discerning and knowledgeable about service quality and market alternatives.

Companies that ignore these trends do so at their own peril. Businesses have a huge opportunity to improve customer relationships—whether it’s through consumer-driven technology, cloud services and data analytics or via new business processes that emphasize enhancing the total customer experience. By failing to take a strategic approach to building stronger customer relationships, companies can risk losing out to competitors that do.

Industry research shows that customers are more discerning about the services they receive and are open to dumping one provider for another when they feel they’re not getting good service. Of the 10,000 consumers in 27 countries surveyed online in 2011 by consulting firm Accenture, 66 percent switched companies as a result of poor customer service.

Accenture’s Global Consumer Survey, released in January 2012, shows that the proportion of consumers who switched companies for any reason between 2010 and 2011 rose in eight of the 10 industries covered in the survey. The report also found that just 23 percent of the consumers surveyed feel “very loyal” to their providers, while 24 percent said they had no loyalty at all.

Social Studies       

In the face of these challenges, companies need to find ways to more effectively engage their customers. Social media can be a prime mechanism for improving customer relationships, and gives customers additional ways of getting in touch with companies.

Customers are much more empowered by today's social Web, says Lorrie Thomas Ross, CEO of Web Marketing Therapy, who develops marketing relationships via the Web. “They read reviews and are influenced by their peers,” she says.

Social media sites are playing an increasing role in consumers’ purchase decisions, adds Robert Wollan, global managing director, customer relationship management at Accenture. “A growing number of consumers—and not only younger ones—are posting comments about products and services, trusting the comments posted by others, and reporting that such comments are influencing their purchase decisions,” he says. “The consumers’ cravings for personal interaction and engagement with providers are growing, and are becoming a significant factor in their choice of and spending with a provider.”

Hotel company Best Western International in Phoenix is rolling out a social media feedback program to its more than 4,000 global locations. The program will enable hotel operators to manage customer relationships via TripAdvisor, Twitter, Yelp and other popular social sites.

Best Western understands that public responses on sites such as these affect bookings and increasingly have a bigger impact on the bottom line, says Michael Morton, vice president of member services at Best Western.

The company has been using an application from Medallia that allows it to get feedback from guest surveys. Over the past year-and-a-half, it has been eyeing the possibility of using data from travel review sites such as TripAdvisor and other social sites to help improve service and draw new business. But since many Best Western properties are smaller hotels that don’t have the resources to analyze online travel and social media sites such as Facebook, the company needed a way to gather such data in a central location that could be accessed by hotel operators.

Best Western looked at several technologies that could aggregate such data, but when Medallia agreed to develop a cloud-based application for this purpose, Best Western decided that staying with a familiar vendor made sense.

Within a year, Medallia had the software  as a service (SaaS) app ready, and in January 2012, Best Western began rolling it out to hotels. Managers can now analyze customers’ reviews and reply to them when appropriate. It will soon have the ability to compare their own hotel’s performance with that of competitors.

“If we’re able to get their response, respond appropriately and show that [we can] react sooner and address their concerns, it helps us from a customer care perspective,” Morton says.

In addition to giving hotels a direct and immediate feedback mechanism, the social media program gives Best Western’s marketing team a tool for tracking customer trends, which can help it shape marketing campaigns. The team can use positive feedback from customers as part of its marketing efforts, Morton explains.

Best Western is looking into making the application available on mobile devices such as smartphones and tablets, so hotel managers can access the program from virtually any location. 

Business Analytics

Another trend that’s helping organizations get the most out of customer data and improve relationships is the growing use of business analytics, often in conjunction with CRM systems.

“CRM solutions are most associated with sales automation, service automation and marketing automation,” says William Band, vice president and principal analyst at Forrester Research, but adds that limiting CRM to those functions is narrow and outdated.

“We see CRM to be encompassing all those data-centric types of solutions, but also including other sources of customer information,” such as order management systems, e-commerce sites and social media, he says. “The explosion of structured and unstructured customer data places a premium on robust business intelligence and analytics capabilities around what do with that data. This gives companies insights to interact with customers more effectively.”

Having customer information located in one central location rather than taking a siloed approach continues to be an aspiration of many companies, although it has been difficult to achieve, Band admits. “The data warehouse did plug a hole and made it easier, but a lot of [organizations] have never been able to get all the data in one place,” he says. “That’s still the vision, but people are no longer thinking in terms of one system; it’s much more a matter of federated data architectures being put in place.”

The idea of “one version of the truth” when it comes to customer data makes sense for organizations hoping to build stronger relations. Consolidated data spares companies from service errors, so “interactions are done based on history and custom notes that relate specifically to the customer,” Ross, of Web Marketing Therapy, says. “In today's tech-savvy world, customers demand service and a personal touch. Companies can't afford to be siloed and miss the service mark.”

In 2008, Cemex USA, a provider of building materials in Houston, deployed a CRM system from SAP to obtain a 360-degree view of its customers with a single point of contact to enhance the customer experience. The system enables the company to facilitate interactions, fulfill customer expectations on delivery performance and provide reliable and on-time account information.

“If we had this information in several places, we would not be able to provide best-in-class service to our customers across multiple channels and departments,” says Ven Bontha, customer experience manager. “Today, we handle order fulfillment on a 24-hour basis at a lower cost, at a high rate of accuracy—99.97 percent for order-taking—by having a centralized operation with a single point of contact.”

Building Rapport

A consolidated customer data strategy has also worked well for 1-800-GOT-JUNK?, a junk-removal service provider based in Vancouver. The company uses several tools to manage its customer relationships, including’s CRM offering, Microsoft Dynamics CRM Online and Google Analytics. “All these tools plug into our in-house BI [business intelligence] platform, allowing us to roll up and report 'a single version of the truth’ to our corporate, executive and franchisee business stakeholders,” says Scott Rutherford, the firm’s director of technology.

Having accurate customer information readily available to users allows the company to better serve those customers. For example, on their way to a job or on the job site, the firm’s truck team members can access data from original customer sales calls to enhance their service provisioning with context about the customer’s needs, Rutherford says. “For customers who contacted our agents via Website chat, a transcript of the chat is also available in the same way,” he says.              

1-800-GOT-JUNK? created a system that allows conversations that its call center agents have with customers to be uploaded within a proprietary booking system called JunkNet.

“Our truck team members can now listen to the recording of the call prior to arriving at the customer’s home or business,” says Michel Falcon, customer experience coordinator. “This has proved to be valuable from a customer experience perspective because we are able to continue the original conversation on-site, understand the scope of the customers’ junk-related [needs] and build rapport in a unique way.” For example, a truck team member can arrive with a birthday card for a customer after learning through the call-recording program that the customer’s birthday is on the day of the pickup.

The call-recording program has helped improve the customer experience “because we are now better prepared to help our customers’ unique situations,” Falcon says. “We have experienced an increase in our customer loyalty rates, and our truck teams now feel better prepared to perform their job.”

Another organization dedicated to improving the customer experience through data gathering is Benchmark Assisted Living in Wellesley, Mass. The company, which provides senior housing in the New England area, uses a platform called Voice of the Customer (VOC) from Allegiance Software to gather customer feedback from email, social media, phone calls, Web forms and other sources. It manages the data via a cloud-based platform from Allegiance called Engage.

“Establishing and maintaining positive relationships with our clients and their families is the lifeblood of what we do,” says Brenda Abbott-Shultz, vice president of customer experience at Benchmark. “Therefore, investments in those relationships have to be thoughtful and strategic.”

VOC, which Benchmark implemented in 2011 to replace a paper-based process, enables the assisted living organization to recognize and promote what is working well and to make timely, focused changes when necessary, she says. Benchmark uses the platform to survey about 4,000 residents and 12,000 family members. The Web-based surveys determine how residents are weathering the transition to assisted living and help assess whether employees are anticipating and meeting all of their needs.

Every seven days, Benchmark analyzes comments from the various feedback mechanisms and sends a report to the company’s senior team of managers in each of the residential communities so they can make needed changes. It also performs annual surveys of residents and families to measure overall customer satisfaction and perceptions.

Feedback and survey results have led to operational changes that helped reduce the number of residents who leave the company’s housing within the first six months. From April to October 2011, move-outs due to dissatisfaction were 12 percent fewer than had been reported from April to October 2010. The company achieved a 143 percent ROI on the application in the first year, Abbott-Shultz says.

Versatile Communications

One of the most important things companies can do to enhance customer relationships is give clients the option of getting in touch with them by whatever means they prefer.

Companies have to be prepared to engage with clients by phone, email, instant messaging, Twitter, blogs and other tools.

“Today, consumers expect a multichannel experience,” Accenture’s Wollan says. A majority of the consumers Accenture surveyed reported frustration when they weren’t able to access company information or purchase a product through the channels of their choice.

“We currently maintain contact with our customers through various channels, depending on the mode by which they initiate [contact] with us,” reports Rutherford of 1-800-GOT-JUNK? “For example, our call center manages inbound live phone calls, as well as email, [Facebook] messaging and chats from our public Website. We pride ourselves on providing world-class response rates and customer service.”

As an early adopter of many of these technologies and communication channels, 1-800-GOT-JUNK? has relied on a series of cobbled-together solutions to provide this service. However, in March 2012, the company launched a contact center management platform, based on Microsoft’s Lync 2010 and Aspect’s Unified IP 7 unified communications offerings. The platform makes it easier to manage a variety of customer communication channels. In addition, the company built a complaint resolution system that monitors communication channels, such as phone calls, emails, social media, etc., for customer feedback, and enables agents to quickly take action based on their comments.

“We use the data gathered from this system to train our franchisee partners how to better deliver an exceptional customer experience,” Falcon says.              

Because of the complaint resolution system, “we can now commit to timelines to resolve our customers’ complaints,” Falcon says. “Our goal was 80 percent [of issues] resolved within three business days, and we have achieved 90 percent resolved within three business days. We have also been able to individually address certain [issues] and reduce how often they affect our customers.”

With customers becoming ever more discerning, demanding and tech-savvy, companies will need to make these types of service improvements to hold onto their clients and create even stronger relationships with them.

Tips for Strengthening Customer Relationships

  • Keep customer data clean, fresh and available to the people in the organization who need it. If you want all this data located in one place, be prepared to do the work necessary to achieve that.

  • Ensure that key stakeholders of customer touch points (call center, on-site, Website, etc.) are closely aligned and meet regularly to discuss customer experiences. By having better collaboration, systems and strategies, you’ll improve service to customers.

  • Give customers benefits that matter to them. Today, customers want more than just a smooth experience—they want to be recognized and rewarded for loyalty.

  • Provide meaningful ways for consumers to engage with the company, including via digital channels. Boosted by social media, customers crave personal interaction.—B.V.