Customer Loyalty Will Be Created By Engagement

I recently found a Forbes article from last year that described how engagement will be the future source of customer loyalty. This was back in March 2014 and when talking of ‘the future’ you probably don’t expect it to arrive within a few months, but I would argue that as we are now entering 2015 it is already accepted that engaging with customers is the most powerful way to create trust in your brand. This is no longer the future.

Engagement is also good for your bottom line. There is a strong correlation between companies that actively engage well with their customers and increased revenue and profit.

As Forbes said in the feature from March 2014:

“Engaged customers trust your brand, advocate for you, and buy a greater breadth and depth of your products without as much price-sensitivity. They recognise that their strategies and your strategies are aligned. The engaged customers of one large technology company I talked to generate 33 percent greater revenue. And they are 4 percent more loyal and represent 12 percent greater share of wallet than transactional customers.”

These changes are taking place because the way that brands interact with customers has changed dramatically in the past few years. It is no longer the function of a ‘customer service’ department to be the sole owner of any contact between a brand and the customer.

Customers now want to talk to brands before a purchase, as the purchase is being made, and after purchase. They might be asking questions about how best to use a product, or engaging with a brand in a way that encourages additional purchases – a supermarket publishing recipes for example.

The nature of the customer relationship with brands has changed and communication is now a basic expectation. Engaging in communication with customers that makes them feel valued and excited about the brand certainly drives spending and retention, which is exactly what the old loyalty card systems used to do.

So are the days of the loyalty card numbered? I’m going to explore this in more detail in a future blog, but please feel free to leave your opinion in a comment or tweet me on @matt_sims1.

new currency


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NOA Council Elections – vote now!

The National Outsourcing Association (NOA) is a not-for-profit trade body focused on every aspect of outsourcing. The organisation publishes research, conducts conferences and other events, and strives to ensure that companies who use outsourcing within their business can learn how to do it better. It really is the centre of excellence for knowledge of outsourcing in the UK and Europe.

The NOA has a strategic advisory council that regularly meets and guides the principles and direction of the organisation. Council members are elected and this year I have put my name forward to stand as a candidate – to represent the Large BPO Supplier community.

If your company if a member of the NOA then you are eligible to vote for me and I would really appreciate it. Although Teleperformance is a big company, only 5 votes from each company count so that candidates from large organisations cannot just ask everyone on their team to vote!

You can click here to see all the candidates standing for election and to read my own personal manifesto, but it’s worth mentioning a few words on the blog here as I am passionate about the industry and what independent organisations like the NOA can achieve.

I believe that outsourcing has been misread by much of the general public – and many in the business community – as a tactical tool for improving the value chain. Outsourcing is a strategic tool that is now focused on solutions and can be applied across all verticals and industries. In many industries today, such as where I am specialised in customer experience, it is now almost essential, as the processes have become too complex to manage in-house.

Business is changing fast in many industries, and that includes the companies who already have a mature understanding of outsourcing as a strategy. Concepts such as the cloud and app store are changing how enterprises manage their information and how the procurement of services takes place.

So with some industries now using outsourcing as a necessary strategy and some industries finding that the way they buy services and expertise is changing almost daily, there is a role for those who can see the big picture. I believe this is the role of organisations like the NOA – to explore how business will work in future and to help managers plan for that future before the future arrives.

I would appreciate your vote in the NOA Council elections. The voting closes on Feb 19 so if your company is an NOA member then please do click here to find out how you can make your vote count.

Click here to vote…

NOA image on floor


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Customer Experience Happens While You Are Busy Making Other Plans

In 1980 John Lennon sang: “life is what happens to you while you’re busy making other plans.” It’s a quote I thought about when I was asked to contribute to a feature on the future of outsourcing published in The Times tomorrow.

The future of outsourcing is really just the future of how companies are going to work together in future – how will corporate relationships work? Lennon’s comment is very prescient because he has noticed that while we run around worrying various problems, change takes place without us noticing.

In the article featured in The Times today I explore the results of a survey undertaken by Teleperformance where we asked 69,000 people in eight countries to rate their most recent customer experience. Fewer than half were satisfied with their last interaction with a brand and we found that a positive interaction is enough to shift the positive perception of a brand by over 33%.

These figures speak for themselves. Corporate leaders have focused for years on increasing revenue and reducing cost, but I believe that in 2015 it is a focus on customer experience that is needed. If you focus elsewhere, the customer expectations are going to change anyway – customers will soon become ex-customers.

The Future of Outsourcing supplement can be found inside your copy of The Times tomorrow (Thursday Feb 5th 2015) or for the online version click here…

073/365 - Last newspaper


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Is Customer Service Adapting to the Mobile Customer?

Mobile commerce used to be considered an added extra. Most customers browsing an online store would shop on a laptop or PC and not on the tiny screen of their phone – but that has all changed.

Phone screens are getting bigger, tablets like the iPad have exploded in popularity, and now with 4G speeds the mobile retail experience is better than ever before. It could be argued that people are now browsing on a mobile device as their first choice of how to access the Internet.

But if customers are going mobile then how does that affect the way that brands should offer them help? Does your customer service strategy need to be adapted for the mobile environment?

MyCustomer recently featured a list of 9 ways to improve customer service in the mobile environment. A few of those that really stood out for me are:

  • Listen and respond to the customer; you can integrate the shopping environment into social and communication channels so feedback on the experience should be easy and immediate – but you also need to listen and take action if you have encouraged the customer to comment.
  • Ensure that the interface is user friendly; sometimes it may be better to create an app and sometimes the web browser is enough. Think about how the shopping experience can work better on a smaller screen.
  • Personalise the experience; the phone or iPad is a personal device and you can usually do more to personalise the experience than would have been possible on a traditional web-based store.

These are all great points, but some brands are going even further. The new Amazon Fire smart phone has a button on the phone marked ‘Mayday’. If the user clicks the Mayday button then a video call is initiated with Amazon – they will have a person on screen within seconds ready to help the user with any aspect of how to use the phone.

I believe we will see more of this in future as brands find that the mobile environment is not just about managing a smaller screen. There is the opportunity for a much more personal interaction with customers via their mobile device, which can improve both the shopping and service experience.

Have you found an example of great customer service in the mobile environment? Leave a comment here or tweet me on @brownsourcing.

Amazon Kindle Fire


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Who pays for Internet infrastructure?

You plug in your computer or connect your phone to 3G or 4G and you are online – the information flows. But have you ever thought about who is providing the infrastructure that allows information to flow around the world globally in an instant?

It involves satellites, fibre networks, undersea cables – all extremely complex and expensive and yet the average end user of an online service has little awareness of just how much infrastructure is needed to ensure there is a global flow of data.

In general, most of the network infrastructure is provided by the Internet Service Providers (ISPs). They are usually the companies we all pay for access to the net. These companies invest millions each year to improve and maintain the network, but everyone is using more information so the networks are straining to cope.

In particular, users are now demanding more video services than ever. Most new televisions today are Internet-ready. This means that they can hook up to your home Internet service and immediately offer video content from providers such as NetFlix, YouTube, and the BBC iPlayer.

This ease of use – as opposed to having to open a laptop to use YouTube – is dramatically increasing the amount of users that expect a quality video streaming service. But now the ISPs are fighting back and insisting that companies such as NetFlix need to contribute to the cost of the network, because they are the main driver of increased data traffic.

However, the concept of ‘net neutrality’ existed long before this ever became a problem. In short, net neutrality ensures that all ISPs need to handle all data equally. It is not possible to discriminate against certain types of data, or to favour certain users when routing data traffic.

Clearly these rules were introduced to maintain the democratic ideals of the Internet and the Internet Protocol (IP) that the data uses to get ferried around the world, however the networks are finding it increasingly difficult to operate in a world where all data is equal.

I believe that as we move forward, the concept of net neutrality has to change. Some customers will be prepared to pay a lower price for a lower service and some customers will be prepared to pay more to ensure their movies stream flawlessly. This is not discrimination; it is just competition and the functioning of a free market.

Airlines are the same. Passengers who are focused on getting to their destination alone will pay for a budget airline, with extra fees to board first, check baggage, or enjoy a glass of wine on board. Passengers who want reserved seats, a generous luggage allowance, and a free glass of wine choose an airline that offers all these features – at a different price point to the budget service.

With companies like Netflix I believe there is a logical outcome that should work for Netflix, the ISPs, and the end consumer. Netflix pays a premium to the ISP to ensure their services are delivered flawlessly. The ISP receives these extra funds and invests in greater capacity to support Netflix. The end consumer is given the option to pay more for the flawless delivery of high bandwidth content.

The end consumer should really be the person deciding whether they want to pay more to get a better service – that’s the best solution for every party in the supply chain.

The Listening Planet


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Why do energy companies provide a customer (don’t) care service?

The Guardian recently focused attention on falling oil prices and how UK energy customers are not seeing this passed on to their bills. According to their data, the average British energy customer is now overpaying by around £140 per year.

The newspaper argues that if you are a customer on a standard tariff – not including any special price deal – then by switching now you could see your energy bills drop by around £300 per year. That’s a significant saving, but how can this be the case?

The price comparison websites have documented that prices are dropping significantly – about 15-30% in the past six months alone. However, these tumbling prices are generally offered only to new customers, so it pays to switch, but if you are a happy and loyal customer then it is unlikely that any of these discounted rates are coming your way.

Articles such as this really highlight the role that improved customer service has to play in the UK utilities sector. Firstly in the way that better service can encourage customers to stay loyal – many would prefer to pay a little more and to be looked after better than to save a few pounds, but find they have endless problems with the service. Secondly though, by engaging a more proactive customer service team it can be possible to identify customers who are not happy, who are thinking of switching, and to engage with them before they are lost. When a customer calls and asks for their annual energy usage in kilowatt-hours, that’s not for a pub quiz, that’s a customer churn indicator – how many energy companies have retention strategies in place to retain and grow that customer?

It’s a shame that loyal customers are not being rewarded, although this tendency to offer better rates to new customers applies to many other markets, such as insurance, banking and telecoms.  Utilities is seen as a grudge spend by customers as highlighted in an earlier blog post and the perceived hassle of switching is often relied upon by energy companies to retain their customer base. This has wider implications for the customer lifetime value to an energy business through supplementary propositions including boiler care and extended home servicing products.

It is however easy for UK energy customers to switch supplier and with it now being quicker than ever before and with the media highlighting these large discrepancies in prices it is likely that all but the most loyal customers will be exploring how to get their hands on that £300 saving. As the UK weathers storms and high winds, the Energy suppliers will too look forward to warmer times when customers once again turn their attention away from seasonally high utility bills.

The big energy companies really need to look after their customers in such a competitive and changing market. Thinking more about the overall customer experience – including aspects of loyalty and advocacy in an ever-increasingly online world– is a great start. 

Electricity pylons   Photo by Ian Britton licensed under Creative Commons

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Will Amazon Echo Make The Connected Home of The Future A Reality Now?

I was interested to read recently about ‘Amazon Echo’ and how it has been recently piloted in homes. It is a voice control device that has no interface other than accepting voice commands – also responding using a voice.

In short, it allows us to start moving on from the idea of a ‘connected home’ as something from science fiction to now offering it as a reality. Echo uses far-field microphones so you can address the system from anywhere in a room, asking questions as you might with the Apple Siri system, or asking it to undertake specific actions – such as engaging the home security system or setting an alarm call for the next morning.

I can see enormous potential for Amazon if a system like Echo takes off. Naturally it can also be used to purchase from their site with the need for searching and interacting with a website. It would be easy to ask Echo to obtain a computer game or movie – one request to the system and it would be automatically downloaded to your TV or console.

Likewise, as Amazon sells just about everything it is easy to imagine even telling Echo what groceries you need and allowing the system to store up a virtual shopping list, until you give the system a green light to make a delivery of everything you mentioned this week.

But there are clear privacy issues. The system will be in your home and always listening to activity, always sending reports back to the central server. Clearly these concerns need to be addressed as we all move into the era of the connected home.

However I can see many more benefits than drawbacks. In fact, it seems like an ideal customer service solution where the customer can be in his or her own home, asking questions to Echo, and Echo connecting the customer directly to someone that can help. It sounds like a great tool and I’m going to follow the trials with close interest.

Ok, the housing fits


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