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Contact Centre Featured Article

February 19, 2010

Q&A On Loyalty With Convergys

By Brendan B. Read

Senior Contributing Editor

Ryan Pellet is vice president, Global Business Units, Convergys. He is responsible for the management of Convergys’ (News - Alert) portfolio of standardized and differentiated consulting offerings, and leads Convergys’ application of analytics to the company’s billion-plus customer experiences/interactions. Pellet also serves as the strategic thought leader and managing executive founder of Convergys’ Center for Applied Customer Experience/Analytics.

TMCnet.com recently interviewed Ryan to get his take on key customer loyalty issues.

The full exchange follows.

TMCnet: Please identify the top trends regarding customer loyalty. Discuss the rise of social media, increased customer use of mobile devices and channels, and do-not-call/do-not-mail and privacy concerns and legislation on developing and maintaining loyalty.

RP: A satisfied customer does not make a loyal customer. Our recent research showed that while over 85 percent of customers say they are generally satisfied with overall service, only one-third would remain loyal after a single bad experience. Bad experiences are quickly communicated using both traditional and emerging social media channels. More than 87 percent of customers tell others of their bad experience using traditional channels.

Furthermore, 64 percent of ‘Millennials’ create online content and the growth of people creating or using online content will grow from 85 million to 115 million from 2008 to 2013. Companies who will prevail over this challenge will tie the ability to identify feedback through social channels and quickly incorporate and react to the feedback via refined customer experience processes. These business processes will have to move at social speed and use alternative/intelligent channels. Deliver what you say you will, and when you mess up, react quickly by fixing the individual issue AND the root catalyst issue.

TMCnet: What are the benefits of building customer loyalty? What is the ROI? What are the challenges in creating and maintaining a loyalty program?

RP: According to recent Convergys and market research where customers, companies, and employees were polled on loyalty and the customer experience, achieving value-based customer relationships drive a three percent market capitalization increase for companies that lead versus remain on parity. The challenge is optimizing the “Outside-In” customer view versus the traditional “Inside-Out” enterprise view.

TMCnet: What impacts has the downturn had on customer loyalty? What will happen to it when the economy slowly recovers?

The recession has made customers more determined to protect their “rights” and are not willing to settle for less than the best experience… every time. Customers say that companies can increase loyalty by offering a good value for their money. They also are quick to attrite if the value based experience, which was promised, is not delivered.

TMCnet: Has there been an increase or decrease in customer loyalty, in what markets, and why?

RP: Regardless of industry, our research shows that customers rank companies unwilling to work with them to resolve the problem as the number one barrier to loyalty (21 percent).

Also, 82 percent of ‘Gen X’ and 85 percent of ‘Baby Boomers’ prefer outstanding customer service to companies with the latest greatest products. While this percentage is lower (64 percent) for Millennials they are twice as likely to use web and chat for customer service as Baby Boomers and Gen Xers.

In addition 64 percent – 71 percent of Millennials are creators/consumers of online content using this media for research and information on products and services. As a result advertising and marketing of a company’s products and services is no longer solely in the hands of the company. Where do you go to find out about a product or service? I start with Google (News - Alert), and double click from there; usually finding myself NOT on the company’s website.

TMCnet: Discuss the role of contact centers in developing and maintaining loyalty. What issues if any are there? Explore contact center metrics such as first call resolution, calls per hour, plus cost-reducing methods, and tools such as CRM, and IVR and web self-service in this context (i.e. ‘I want to deliver great customer service but please get off the phone’). Can contact centers do a better job in loyalty while still keeping costs down and if so how?

RP: Across industries, our research shows that 65 percent of customers cited “knowledgeable employees” and 64 percent cited “addresses my need in the first contact” as the top two attributes of a superior customer experience.

Therefore companies should invest in training, process development and technology to ensure their agents are enabled, equipped and empowered to meet the customers’ needs within the first contact. Then companies must have in place the analytic framework and capabilities to collect and analyze the customer experience closing the loop with feedback to customers. Doing so will correct the current perception that over one-third of customers say companies do not listen to or act on their feedback.

One has to separate contact center efficiency, from company effectiveness. The contact center is now seen as one of the most strategic assets for a company to center itself around. The most knowledgeable about a company’s product/service is the customer. Contact center value far exceeds the value extracted if focused solely on cost.

TMCnet: What are the best strategies, methods and technologies to deploy in developing and enhancing customer loyalty?

RP: The things companies can do with their contact centers to develop and drive loyalty are:

* Align the customer and enterprise views;

* Organize and influence the core tenets of the customer experience: care strategy, technology/tools, process, agents and analytics;

* Listen carefully to the Outside-In view and align efforts to cash flow drivers;

* Invest in technology that intelligently closes the customer experience loop;

* Know that there is no longer a middle ground; you are either customer centric, or you are not.

Brendan B. Read is TMCnet’s Senior Contributing Editor. To read more of Brendan’s articles, please visit his columnist page.

Edited by Marisa Torrieri

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