Return on Behavior Magazine
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Customer Experience

September 27th, 2009

Is Customer Service only a Cost-Factor?


Often, employees only focus on making a sale, thereby forgetting to ask the question why the customer buys the product.

The global economy is in a down-turn and especially the finance sector is struggling. Apart from that, especially within the Insurance, Banking, Utility and Telco industry, markets are saturated and products are hard to comprehend and to differentiate from one another. As a result customer loyalty tends to be very low.

Now, the core question is how businesses can acquire new customers to compensate for the rapid decrease in existing business. In this situation, many companies face an uncomfortable paradigm: either to save money or to earn money.

The decision of what to focus upon requires an understanding of the things that really drive value for a company. A vital aspect in relation to that topic is the development within customer service during the last couple of years, where we have seen an ongoing trend towards automation aiming at decreasing costs by applying new telephone and online technologies. Fair enough, it has to be said that optimization-specialists as well as controllers accomplished to decrease costs when handling a customer.

But how would the picture look like if the sales department took the lead in customer service?

Customer service does not necessarily have to be a Mecca of complaints and problems. In fact customer service should be considered as a place where customers seek and receive understanding and help for specific products and services. Every customer contact represents the chance to trigger up-sale and to give the customer a good experience. Positive experiences are vital in order to turn “ordinary customers” into loyal customers or even ambassadors of the company.

It is worth mentioning the USA as the place where the new big mantra Voice-of-Customer was born. In many US companies, the customer status was re-positioned to stand in the center of the business. Customer service was evolved according to what customers really require from products and services. While having a customer centric approach many companies managed to accomplish increased profits through up- and cross-sale as well as customer satisfaction.

Though the following words might sound a bit corny, high-quality customer service pays off in the long run. However, it seems as if many big, highly-complex companies within Europe have lost focus on that matter. Customer service is continuously down-graded to a mere function or isolated department.

Employees within customer service normally receive a relatively low salary. This combined with old and/or complicated IT-applications does not create a good foundation to increase quality within customer service in order to become more customer-centric again.

Especially within the Insurance, Banking, Utility and Telco industry, markets are saturated and products are hard to comprehend and to differentiate from one another. As a result customer loyalty tends to be very low.

If we take the USA as a crystal ball, we can predict that the winners will be those businesses that accomplish to integrate a high quality customer service strategically within their businesses, thereby regarding every customer interaction as a source of value.

It seems as if more and more companies understand how important it is to focus on their customers. How much advertising bombards us every day, conveying a message that we as the customer are “not just a number”.

But there remains one big question to answer: When was the last time that you have been treated so nicely when interacting with your bank, your insurance or your energy supplier that you still remember it as a good experience?

About the Author

Fredrik Abildtrup

Fredrik Abildtrup is the CEO of TeleFaction. He is a seasoned customer experience and Return on Behavior specialist. Currently he is responsible for the growth and internationalization of TeleFaction. Moreover he assists TeleFaction clients in improving customer loyalty, reducing churn and increase cross-sales across customer service contact points. TeleFaction primarily caters to European businesses in the telecom, financial services, energy, travel and transport industries.

He has many years of  business experience, primarily in sales and management. Most recently as the Division Exeuctive with T-Systems Denmark, a sister company to Deutsche Telekom, where he was responsible for more than 100 employees.

Fredrik Abildtrup graduated from the Copenhagen Business School with a degree in International Marketing and Management. Moreover he has a master's degree in International Business obtained via the CEMS-programme at the Universität zu St. Gallen in Switzerland.



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