the missing link: how to combine customer care …...customers during that holy grail of the 1:1...

The Missing Link: How to combine customer care

and customer experience to build awareness,

create loyalty, and grow revenue

A Sutherland Retail Perspective

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Retail

The Missing Link

3 Sutherland Global Services | The Missing Link

Contents Foreword

For too long, retailers have considered customer care to be only a cost. Instead, by combining it with customer experience, big data and predictive analytics, customer care

can actually generate revenue.

The transformation hinges on developing a new system that arms customer care agents

with intelligence that’s widely available, yet rarely shared. It relies on information gleaned from the constant signals customers provide based on multiple experiences with

brands across multiple touchpoints. Retail marketers often use these signals to develop a

customer journey that’s seamless, relevant, authentic and omni-channel.

Too often, however, that data gets siloed within the marketing department. It’s a missing

link that needs to be shared with the customer care team.

Unlocking this information for the customer care team can spur personalized engagements. That, in turn, helps resolve complaints, increase Net Promoter Scores,

improve customer satisfaction, create loyalty and, yes, grow profits. This paper includes examples from retailers that illustrate those results, and it shows the way to further

combine customer care and customer experience, boosting businesses even more.

The following sections highlight concepts and insights needed to achieve this customer

care integration. They describe how to get started, make it personal and equip the agent with an automated set of intelligence to make real-time recommendations. Ultimately,

we’ll show how to measure success.

Before we begin, here are a few definitions that will be used throughout this paper:

Customer Experience Design – The way retailers envision interacting with customers over time, from awareness and discovery to advocacy, purchase and use of a product

or service.

Customer Experience Journey – The customer’s actual experiences when engaging with

a retailer, either in-store, via phone or across digital channels.

Customer Care – The retailer’s efforts – by humans or technology – to take care of

customers before, during and after a purchase.

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THE IMPORTANCE OF INTEGRATING CUSTOMER CARE IN THE CUSTOMER EXPERIENCE JOURNEY

Customer Care has the voice of the customer at a 1:1 level

Marketers consider intelligent 1:1 communications with their customers to be the Holy

Grail. It allows them to use the right message or offer at the right time through the right channel. To achieve this, marketers analyze data and analytics, creating a 360-degree

view of their customers. This provides a blueprint of customer intelligence, leading to

insights that drive strategic marketing plans.

Customer care agents, meanwhile, routinely have that 1:1 communication with customers. Unfortunately, they often lack the analytics needed to guide a customer’s

journey. The agents know only basic information about customers, and therefore, focus

mostly on solving issues as quickly as possible.

When retailers have those 1:1 opportunities with customers, why not position their customer care teams to take advantage? Why not give customer care agents the tools

needed to become an integrated part of the customer experience?

Some suggestions:

Understand and journey map the end-to-end customer experience

Customers interact with retailers however they want – either in-store or online –

and whenever they choose – either pre- or post-purchase. Retailers must understand the customer’s experience and perspective at each of these points and across the

entire customer journey.

Leading retailers use “journey mapping” to map the end-to-end customer

experience. This helps identify problems when the process breaks down and opportunities to reduce “friction points.” In turn, retailers prevent revenue leakage

and improve the overall customer experience.

[Fig.1: Customer Journey Map]

Integrate channels to share data, drastically improving handle times and first call resolution – When the customers decide to interact with retailers, time matters

more than ever

Retailers must provide access to customer care across different channels and

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mediums to satisfy customer needs. And each channel must provide service in a way that makes the best use of the customers’ time. Any missed opportunity to fulfill

customer expectations creates a risk of shoppers heading to a competitor.

Think about your experiences as a customer when you’ve been frustrated. Maybe

you try working with a company’s app, and when that fails, you try an online chat. You might lose your internet connection and have to start over. Maybe you try to

reconnect, or maybe you try a self-help phone tree. Either way, when you finally

reach a live agent, he or she knows little about your issue.

You may try multiple channels and waste multiple hours. Even if the issue finally

gets resolved, did you receive any offer to help compensate you for your troubles?

Find the whole truth about a customer

Many business functions have their own customer data management systems. That means each function – ecommerce, store, social media, email, loyalty, customer care,

customer insights, etc. – has its own partial version of the “truth” on each customer.

By eliminating the internal data and technology silos, retailers can provide a

seamless, relevant, enjoyable customer experience across all channels. And if that

experience includes customer care, it can even help cross-sell and up-sell.

Avoid leaving money on the table

With carefully targeted offerings seamlessly blended throughout the customer

lifecycle, retailers can create momentum with a positive customer experience at

every stage of the journey. That can generate revenue.

Customer care agents, of course, must start by efficiently solving the issue at hand. Without integration, however, they miss out on key opportunities to further engage

customers during that Holy Grail of the 1:1 communication.

With the right tools and integration to the larger customer experience journey,

agents can intelligently enhance the care experience in a way that helps the bottom line. Agents may add value by providing customers timely information such as: how

many points are needed to achieve their next loyalty tier, the benefits of doing so, which products/ongoing offers are on sale and which include the double points

necessary to help customers achieve the next level.

Revenue-generation programs can typically be converted into transaction- based

pricing models with variable cost structures. That allows customer care agents to align more closely with a retailer’s top-line targets. It improves customer satisfaction

levels, yields higher order values and delivers better conversion rates.

Creating intelligent agents will help transform customer care from a significant expense

to a revenue-generating part of the business. This level of integration is not easy, but it’s essential. When customer care evolves, it helps retailers provide shoppers with an

outstanding experience throughout the journey, no matter the channel, device or place in

their lifecycle.

So where to begin?

GETTING STARTED

Unlocking information

Retailers are increasingly aware of the value of data mining. It can be a goldmine for designing different customer-focused support opportunities. But if customer information

gets stored in different repositories – rather than making it centralized and universally

accessible – the data won’t be harvested.

Here’s an example of how to elevate customer care from a level of basic support to a

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high-quality customer experience that drives incremental revenue. Sutherland works with a leading pet specialty retailer that needed to improve service level performance

and the overall customer experience. To help change that, we unlocked a key piece

of information.

Sutherland took stock of the 2,000 SKUs of inventory the retailer kept available for web sales. For each item, we suggested three companion products. If someone called about a

new puppy, for instance, the customer care agents would learn the dog’s breed, size and behavior. Besides answering the customers’ initial questions, the agents could then

make suggestions.

Do you have a leash and a bed?

Are you feeding this type of pet the food that will be most beneficial?

Have you heard about the benefits of pet hygiene, and does your dog need shampoo

and/or a toothbrush?

Do you need any training or grooming services? If so, agents can check the stores

closest to the customers and schedule appointments.

The effort helped the conversion rate surge to 80 percent, one-third higher than the

previous year.

Big Data and the omni-channel spectrum (brick, click and beyond)

As successful as the pet specialty retailer has been, much of that work required manual

research. Automating that customer data will be even more effective.

Like our marketing peers, retail customer care executives should create a 360-degree

view of their customers that’s compiled in one dashboard. By embedding analytics in every step of a customer’s lifecycle, businesses are better equipped to predict the buyer’s

behavior. And when that behavior becomes more predictable, it helps

sales and satisfaction.

Customer data to integrate includes:

Transaction logs

Behavior by channel

Demographics/psychographics

Brand and product affinities

Online clickstream data

Unstructured data (e.g., social comments)

Promotional history

Linking this data is the foundation for customer intelligence. Once that happens, the real

learning begins.

Beyond the customer – supply chain

Retailers need end-to-end visibility of the overall customer value chain by understanding

how customers buy, what they buy, when they buy and where. This can be accomplished

by integrating customer data and the supply chain, connecting demand to supply.

This visibility to product intelligence (e.g., description, pricing, promotion, availability, shipping logistics, recalls, common defects, etc.) can help improve customer care, reduce

cost, drive efficiencies, ensure product availability and maximize sales.

Retailers should also monitor the health of their supply chains to help ensure the best

results and to reveal real-time insights for improvement. Monitoring may include

reporting mechanisms on routine logistics and systems operations.

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One fashion retailer we’ve worked with, for example, had 30 percent of its calls to the customer center come after shoppers made a purchase. Our customer care agents

focused initially on resolving the issues, but then they also reported back on the trends

they spotted, such as:

Shipments of online orders.

Measurement charts that needed to be clarified based on the time of year and how

the clothes would fit differently based on the temperature.

Differences in shoe sizes depending on whether women bought high heels or flats.

That intelligence helped keep future customers happy along their journeys.

Technology

Too often when we visit customer care facilities, we see agents using multiple

technologies to handle different aspects of customer issues. When dealing with questions or complaints, customer care agents frequently need to switch interfaces and programs.

Even if the switching can be done quickly, this causes two problems.

Average handle times rise. Customer satisfaction drops.

If agents had one consolidated, longitudinal view of their customer along with visibility into the supply chain, there would be immediate and massive improvement in customer

care. And when that average handle time gets better and the first call resolution numbers climb, that sparks a gain in customer satisfaction, Net Promoter Scores, average basket

sizes and customer lifetime value and loyalty.

At a micro level, we propose strategically integrating data, technologies and analytics as

part of customer care services. This personalization will become the future of

customer care.

Consider the fashion retailer we mentioned earlier. The brand has more than 250 stores and a strong online presence. We streamlined the data from the brand’s client

relationship manager into a centralized location. We then trained customer care agents to quickly review the callers’ purchase histories and better serve as fashion advisers for a

target audience of women ages 25 to 40.

Maybe the shoppers called with a question about a jacket, for instance. The customer

care agents could see the shopper had not purchased any boots and they could suggest a pair that was a perfect match. Or maybe the agents saw an accessory purchased from the

spring line. They can check to see if the customers still value the item, and, if so, the

agents can wisely recommend pairing it with a new piece of clothing.

The technology helped the customer care agents pamper the customers, which, in turn, helped the business. The retailer’s sales conversion climbed from 15 percent to 25

percent – a jump of 67 percentage points – the basket size increased by 7 percent and the

average handle time dropped by 23 percent.

PERSONALIZING THE CUSTOMER CARE EXPERIENCE

The continued drive toward personalized engagements

A longstanding mantra for retailers has been “know your customer.” Businesses have

started evaluating and segmenting data to better understand and predict their

customers’ buying behaviors. As a result, it’s changed their strategy.

Rather than rely on product-centric programs, retailers are rapidly focused on enhancing the customer experience. No matter what communication channel they use, when

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businesses personalize shopping effectively, it creates a brand loyalty with their customers.

Consider intelligent websites. They collect user data and, based on the customers’

preferences, they dynamically present different retail offerings. So as omni-channel marketers and ecommerce leaders make this shift, why does this rarely carry over to

customer care?

Knowing your customer is essential for customer care agents. They need more knowledge

about customers to design, execute and optimize personalized experiences across channels

and devices. We’re seeing some positive signs of this with one area, in particular...

Social media.

As customers flock to Facebook, Twitter, YouTube and other social media platforms, retailers should consider how these communication channels can improve their customer

care and give their businesses a competitive advantage.

Many customers first engage with a brand by using social media to resolve customer

service concerns. If their concerns get addressed, however, the customers’ mood can

quickly shift.

Social media can help respond to customer complaints, proactively answer questions and/or tailor offerings. Doing this effectively can also transform customers into “brand

promoters.” Those promoters, ideally, can act as an extension of the customer care organization, highlighting their positive interactions with a brand and offering advice on

products or services in return for non-financial rewards.

Customer High-Definition – Omni-channel customer profiles

Once retailers create (or tap into) an integrated customer data source, the next best

practice calls for developing mutually exclusive customer segments.

The segments – typically numbering between five and seven – will illustrate the most common customers who shop and engage with your brand. Segmentation is an analytics

exercise that requires statisticians and analytic experts. Afterward, each segment must

be profiled.

Profiling consists of using the top data variables that are mutually exclusive between segments (e.g., household income, age range, education) and other descriptive variables

(e.g., male/female, married, indication of children, geography). Profiles will describe not

only what differentiates each segment, but how to best communicate with them.

Customer profiles reveal several helpful patterns:

Customers’ affinities to different brands and products

Sensitivity to promotions

Which channel(s) are preferred for outbound and inbound communications

In turn, that high-definition view of customers provides new insights. It empowers

customer care agents to personalize their communications with customers.

Applying advanced analytics

Advanced analytics help retailers target customers in different ways, and that personalized

experience delivers results.

Here are four examples retailers should consider to improve personalization strategies

and, in turn, improve customers’ lifetime value:

1. Product Affinity: Determine the next product(s) a customer will find most

appealing over a given time (typically the next 30 – 60 days). With the pet specialty’s customers, for instance, customer care agents benefitted from knowing when pet

owners last bought products such as dog food or pet shampoo. That helped the agents plan follow ups. Agents could also see if a pet owner bought something to treat a dog’s

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fleas, helping them suggest other flea-prevention products for the home or yard.

All of this can be tailored to the breed and age of the pet, arming customer care

agents with the intelligence to upsell or cross-sell products.

2. Look-a-like: Develop a model of the best, high-value, most loyal customers, then

identify other customers who behave in similar ways but have not yet achieved the same spend potential. This helps agents offer recommendations to

untapped customers.

2. Churn Defense: Detect customer signals, especially attrition. As retailers know,

it costs a lot more to bring back customers than it does to keep them. If retailers can

help agents identify and handle customers at-risk of attrition from a product,

category or even a brand, that can help businesses protect millions of dollars.

3. Offer Elasticity: Some customers won’t buy without an offer. Some respond to only certain types of offers (e.g., free shipping, percent off, dollar off, free gift). And

some customers don’t need any offers to buy. Analytics can determine which

customers to target with offers and which offers will most likely resonate.

In summary, customer care executives must personalize their customer’s experience at every touch point if they want to keep them loyal. Customer segments and high-

definition profiles provide the necessary intelligence to do that. Incorporating analytics in the customer experience design will help retailers target the right customer with the

right message at the right time through the right channel. By fueling a better customer experience design, retailers can also build the foundation for new tools that enable

agents to provide customers a personalized experience.

EQUIPPING THE INTELLIGENT AGENT

The basics: Leverage skill-based routing

Compiling a 360-degree view of customers helps ensure the right customer care agent is

having 1:1 communications with the right customer.

Take high-value customers. Someone who either meets pre-determined criteria or is a

loyalty card holder should be serviced by a higher-skilled specialist. Those agents can

provide both support and sales assistance.

Similarly, the service professional’s skills should be customized to specific product sets. Customers should be routed based upon purchase history or the nature of the inquiry.

Implementing skills-based routing programs will, of course, mean product sales scripts for support professionals to follow or use as a reference. Providing this richer support

service, though, has proven to increase brand loyalty and customer satisfaction.

This approach is easily undertaken by building tools that will adjust to and account for

demographic variables, such as buying behavior history, gender, geography, language

and credit history.

Accounting for those variables can also empower agents to decide when to offer appeasements to unhappy customers and what those appeasements should entail. If it’s a

loyal shopper with a legitimate gripe, for example, no need to escalate the situation to a

manager. That would only prolong the problem and further frustrate the shopper.

The fashion retailer we’ve worked has effectively empowered its agents. Its first-call

resolution rate tops 90 percent. The industry standard, meanwhile, is closer to 70.

Getting advanced: Using technology automation to provide agents real-time

recommendations

To take customer insights and create tools for customer care agents, we recommend

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integrating a Customer Engagement Management platform into the customer

care dashboard.

What’s most important about the platform, perhaps, is it provides robust business intelligence tools to measure the outcomes of customer engagement. Capturing and

understanding those outcomes enables retailers to incorporate the customer voice into the customer experience design. That means more relevant, more meaningful

interactions. In time, that also means more long- term customer loyalty and advocacy.

The platform’s tools help customer care agents:

Pick data from disparate sources

Correlate the data and enrich individual customer profiles

Provide cross-dimensional views from the customer’s viewpoint

Interface and deliver relevant recommendations (Next Best Actions)

Deliver these actions to the customers at their preferred touch point with context

and relevance

The key recommendation: agents need new tools to provide customers a relevant,

authentic and timely experience. These tools need to provide agents information, intelligence and recommendations in real-time so they can be efficient and effective.

Customer Engagement Management platforms need to be integrated with agent dashboards to make personalization possible. And they must include data and analytics,

providing a 360-degree view of the customer and automating the information displays

needed for a personalized customer experience.

Sutherland used this approach with one client, creating an intelligent agent desktop. It shows customer care agents the complete customer journey with the brand, including

recent purchases, social sentiment, past inquiries, loyalty tier and preferred shopping categories. The desktop also helps the agent, suggesting products that might appeal to

the customer or ways to improve first call resolution and handle time.

The result: an optimized, efficient experience for the agent, and a seamless and desirable

customer care experience.

MEASURING SUCCESS

The importance of Net Promoter Score (NPS)

As the standard of retail customer care becomes more consistent and homogenous, the

traditional customer satisfaction measure (C-SAT) becomes less helpful.

The more powerful tool: Net Promoter Score (NPS). A customer’s willingness to promote

a service or product to friends and family means the retailer’s brand commitment to its customers has been recognized and fulfilled. Earning that loyalty means customers stay

longer, spend more, contribute suggestions and spark the most powerful form

of marketing.

Word-of-mouth.

The same holds true for employees who enjoy working for a retailer. Their loyalty

generates new ideas and spurs them to go the extra mile to delight customers. There’s good reason why loyalty so strongly correlates with sustainable, profitable organic

growth. In fact, a leader in retailer loyalty grows more than twice as fast as

its competitors.

This approach helped the leading pet specialty retailer we described previously. At one point, it faced enough complaints that eventually reached the Better Business Bureau

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(BBB), lowered employee morale and prevented customer loyalty.

Besides unlocking information and suggesting companion products to callers with

questions, we helped the retailer respond quickly to customers and keep the BBB updated regularly. In fact, while the BBB allows 14 days to respond, we pledged to take no more

than seven. This helped the retailer’s BBB rating jump from an “F” to a “B+.” The front line help desk now closes 85 percent of the cases it receives, compared to less than 40

percent internally. And the rate of employees who considered themselves “highly

satisfied” has doubled.

Sutherland recommends one of two Net Promoter programs, depending on the retailer’s

unique business environment and company culture. As Figure 2 illustrates, the Top-down NPS approach looks inward to identify structural weaknesses in the retailer’s

approach to servicing customers. The Bottom-up NPS approach, meanwhile, looks

outward to assess the strength and loyalty of the retailer-customer relationship.

Beyond CSAT and NPS, what really matters? Outcomes!

As retailers transform customer care from a cost center to a revenue- generator,

traditional success metrics must evolve to focus on outcomes – both for businesses and

for customers.

Some examples:

Average trips per year / quarter / month / week

Average number of SKUs sold per trip

Average number of cats sold per trip

Average spend per trip/year

Lifetime value (LTV)

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Cross-sell conversions (as defined by new products purchased outside of average

basket SKUs/cats):

Average number of SKUs cross-sold

Average number of cats cross-sold

Average amount of annual returns (we want this number to decrease)

Average time to handle return

FCR conversions

Average call times

ecommerce specific outcomes: (e.g., shopping cart conversion rate, average number

of items left in carts before abandonment and the average value of those items)

From a customer perspective, these types of outcome-based metrics tie loyalty to

revenue. And for retailers, the transformed customer care function now helps not only measure the top- and bottom-line growth, it also enables them to better forecast overall

demand and sync that back into the supply chain.

CONCLUSION

Integrating customer care with the customer experience design is a must for

retailers to improve customer loyalty, LTV and business outcomes.

Retailers have the ability to transform their customer care business from a cost

center to a revenue-generating function.

Retailers should take many best practices from their marketing organization and

apply it to their customer care.

Data integration and analytics will develop a high-definition picture of customers

that lead to actionable insights.

A Customer Engagement Management platform is recommend to integrate all customer care assets, yielding an automated set of intelligence and real-time

recommendations to the customer care agent.

Retailers must expand their customer care metrics from traditional NPS / CSAT to

focus on customer and business outcomes.

To discuss how Sutherland Global Services can help you address the challenges presented in this paper, please contact us at [email protected]. To browse through

other resources for business executives, we invite you to visit our Web site at:

http://www.sutherlandglobal.com/industries_retail.aspx

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© Copyright Sutherland Global Services 2016

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About Sutherland Global Services

Sutherland Global Services is a global provider of customer experience management services.

Sutherland offers an integrated portfolio of platform-driven back-office and customer facing

solutions that support the entire customer journey. One of the largest, independent BPO

companies in the world, Sutherland provides innovative services to 100+ global majors in

Communications, Technology, Retail, Government, Healthcare, Insurance, Banking & Financial

Services, and Mortgage. Headquartered in Rochester, N.Y., Sutherland employs over 36,000

professionals and has locations across 19 countries in all regions as well as CloudSource - our

Work@Home program.

For more information, visit

http://www.sutherlandglobal.com

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the missing link: how to combine customer care …...customers during that holy grail of the 1:1...

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