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 Survey: Web Generates Consumer Feedback

Thursday, April 24th, 2008

Read te entire article at

April 24, 2008

-By Eric Newman, Brandweek

NEW YORK Forget focus groups. Consumers are giving it straight to brands, and each other, via online social media in big numbers, according to a recent study by the Society for New Communications Research, Palo Alto, Calif.

“Exploring the Link Between Customer Care and Brand Reputation in the Age of Social Media” surveyed more than 300 active Internet users during February and March.

The study found that 74 percent of respondents choose companies or brands based on customer service experiences shared by other Web users on the Internet. Eighty-one percent of those polled said they believe blogs, online rating systems and discussion forums give consumers “a greater voice” in customer service. However, only 33 percent of respondents felt that companies take customers’ opinions seriously.

“This study indicates that there is a growing group of highly desirable consumers using social media to research companies,” said Ganim Nora Barnes, a senior fellow at SNCR, in a statement. This demo includes adults 25-55 with a college education, making over $100,000 a year. “These most savvy and sought-after consumers will not support companies with poor customer care reputations, and they will talk about all of this openly with others via multiple online vehicles. This research should serve as a wake-up call to companies: listen, respond, and improve.”

The study also found what marketers might find somewhat counterintuitive. While search engines were deemed the most valuable online tools for researching customer experience with a given brand, 39 percent of respondents rated blogging services like Twitter and Pownce as being of “no value” to such research. Similarly, 27 percent found YouTube useless, and 22 percent said the same of social networking sites like Facebook and MySpace.

Of those industries judged to be doing the best job in using social media to respond to customer service issues, technology, retail and travel companies took top honors. Dell and Amazon were noted most often as those companies doing the best job handling customer care problems via social media.

Utilities, healthcare and insurance firms fared the worst.

 Hello, Houston… We Have A Customer Service Problem

Monday, March 31st, 2008

Mar. 31, 2008 (Investor’s Business Daily delivered by Newstex) –

A Verizon (NYSE:VZ) customer thought he was making a routine call this month by dialing toll-free to ask for a rebate. But he got an unexpected jolt when a recording directed him to another number that turned out to be a phone sex line.

Verizon Communications VZ quickly corrected the wrong number. But the damage was done. The customer blogged about the incident, which caused the wireless carrier to issue a public apology for the flub.

Such bizarre glitches are unusual. Yet the rise of blogs, camera phones and video Web sites means buyers today have a much larger megaphone to amplify their gripes.

In turn, companies that focus on consumers — including phone carriers, retail stores and banks — need clear policies to make customer service a top priority, says Bruce Temkin, an analyst at Forrester Research. (NASDAQ:FORR)

“Customer service comes at that point 14 time when customers are highly engaged in the problems they have,” Temkin said. “So it’s always a difficult and important moment of truth for the company.”

A new study from Accenture (NYSE:ACN) ACN found that 59% of people had actually stopped doing business with companies in the past year due to poor service. That’s based on a survey of 3,500 consumers on five continents. Just under half of those polled said their service expectations were met only sometimes, rarely or never.

Often the problem stems from cutting costs at the expense of customers, says Robert Wollan, global managing partner for Accenture’s service transformation business.

He says companies are misguided when they keep people on hold longer or slash store hours just to save money.

“There are still many gross examples of companies (encouraging) the wrong behaviors,” Wollan said. “You have to align the company’s goals through the eyes of the customer.”

Spotty Service

Everyone knows that customer service is vital, but lots of firms still address the task haphazardly. For instance, only 10% of retailers measure customer satisfaction on a weekly basis. Just 8% do so annually.

Even more surprising, 6% of retailers don’t have any set schedule at all in tracking customer satisfaction. That’s according to an annual survey of 137 retail firms by the National Retail Federation and IBM (NYSE:IBM) IBM.

One clear step to improving satisfaction involves appointing a high-level executive with real authority to enforce service levels. At some companies, this role is known as the chief customer officer.

Another tactic is to create programs which stress “the voice of the customer,” as Temkin puts it. For instance, this can involve assuring that all complaints get resolved on a single call, rather than being handed off to multiple reps.

“Companies have to look at every interaction from a customer point 15f view,” Temkin said. “This gets the whole company thinking about things from the outside in.”

He says all interactions should be judged by how well they help customers reach their end goals. Managers, moreover, need to focus on three key questions to get service levels right. They are: Who are your users? What are their goals? And how can you help them achieve those goals?

Companies should take responsibility for any problems, and communicate their message clearly. In addition to showing empathy for consumers, managers must find concrete ways to resolve problems. They also need a clear method to measure success, Temkin adds.

“The fact is that customer service is really, really hard,” he said.

ForeSee Results is a firm that measures online customer loyalty for retail Web sites. In 2007, its aggregate customer satisfaction rating fell by 1.3% to 74%. The rating declined for nearly half of 40 online retailers last year due to higher consumer expectations, ForeSee Results’ CEO, Larry Freed, said on a recent conference call.

Retailers whose scores improved last year included Barnes & Noble (NYSE:BKS) BKS, Wal-Mart (NYSE:WMT) WMT and Best Buy BBY, according to Mark Mahaney, a Citi (NYSE:C) Investment Research analyst who hosted the conference call.

Mahaney says there are essential elements that contribute to improved customer scores like this.

“Focusing on brand consistency, increasing product selection and enhancing the user experience are some of the best ways to gain ground in customer satisfaction,” he wrote in a note to investors.

Lower-priced stores can deliver strong customer service too, so long as consumer expectations are clearly defined and met. Ensuring that people know what they’ll get — not necessarily “wowing” the customer — is the key, says Temkin.

“What is the customer’s expectation for the brand, and how often do you meet that expectation? You need to line up to that mark every time you touch a customer,” he said.

Beware Of Churn

Intense competition in telecoms means even satisfied customers will drop their phone plans to get a still-better experience. Such turnover is known as customer churn.

Sprint Nextel S is battling a major churn problem due to weak service. Sprint (NYSE:FON) was ranked 106 of 112 companies for quality of service in a Forrester study last year. Sprint also finished dead last among the eight mobile service providers.

Sprint CEO Daniel Hesse blames his company’s sinking stock price on weak service. Many irate customers have dumped Sprint, pulling down its sales and shares. On a recent earnings call with analysts, Hesse said improving the customer experience has become “job one” for Sprint.

“Because of the customer experience we provided last year, churn is accelerating,” he said. “In conclusion, our business is not performing well right now, because we have not provided the right customer experience.”

Sprint isn’t alone. In a recent survey of 2,000 mobile phone users in the U.S., 96% said they wouldn’t hesitate to switch carriers to get a better experience. In fact, 72% had already made a switch due to a negative experience.

The Harris Interactive (NASDAQ:HPOL) survey was commissioned by Chordiant Software (NASDAQ:CHRD) CHRD, a maker of business software for customer service.

Another call center technology firm, Amdocs (NYSE:DOX) DOX, found similar results in its survey of more than 2,000 consumers in the U.S. and Britain. About four in five consumers were satisfied with their service levels. Yet one in three said they would switch to another carrier to get better services for mobile games, entertainment and ads.

Another customer service software firm, RightNow Technologies (NASDAQ:RNOW) RNOW, has developed new features to monitor consumer topics and emotions on service calls. In this way, call center agents can use the software to get more context about a caller’s specific concerns and service history.

 Using Customer Service as a Branding Opportunity

Friday, March 21st, 2008

Thanks to Web, Advertiser Can Engage in ‘Conversational’ Marketing With Customers

Published: March 20, 2008

NEW YORK ( — Conversing with consumers and finding out what they think about their brands has become a whole lot easier for marketers because of the web. And whether it’s an actual customer-service call or inquiry or responding to a comment on the corporate blog, marketers need to start looking at each interaction as a marketing opportunity. That was one of the main themes that emerged during the “Listenomics: So you want to be a conversational marketer?” panel at the Ad Age Digital Conference.


The panel’s moderator, Pete Blackshaw, exec VP-strategic services at Nielsen Online, asked the three panelists, “Is this marketing or is it customer service? In the age of consumer control, is there an opportunity to really build consumer loyalty through that type of interaction?”

Interactions equal growth
Tony Hsieh, CEO and director,, said those interactions have been the force behind the company’s growth. “The way we have grown the company is focusing on customer service and not actually spending a lot of money on marketing or paid advertising,” Mr. Hsieh said. “We take the money we would have spent on advertising campaigns and instead put that back into the customer experience and grow through repeat customers and word of mouth. For the past nine years that’s been our primary source of growth.”

Mr. Hsieh said his company gets nearly 5,000 calls a day from customers and it views each of those interactions as a branding opportunity. “At that point you have the full attention of that customer,” he said. “That’s the time where you have a huge opportunity for you to shine.”

Linnea Johnson, director-consumer services, Unilever, who called her division the “Stitch and Bitch Club,” said the world’s second-largest consumer package-goods company should be doing more to take advantage of those types of interactions.

Talking ‘your ear off’
“We’re a little bit behind the momentum,” she said bluntly. “The consumer services department can talk your ear off about all of the information of the brand, tell you what brands to use and cross-sell you but what we’re not allowed to do is take ideas from you. So the minute someone calls up who has a really forward thinking way to promote Dove and Suave, we have to shut them down because that’s what legal tells us to do.”


She believes the consumer-services divisions, especially in the consumer package-goods space, could play a significant role in the development of marketing campaigns based on the interactions they have with consumers. “In the CPG industry [consumer services] are the people who are really entrenched in the company’s brands,” she said. “And there’s a lot of information we could help you with when you build your campaign or build your ads to deal with consumers.”

Rick Clancy, senior VP-corporate communications, Sony Electronics, and primary author of Sony’s first consumer-oriented blog, said Sony also had legal concerns about accepting unsolicited ideas from consumers. “But once you decide to dive into the pond of social media you have to do away with that,” Mr. Clancy said. “We get ideas on my blog that are shared throughout Sony and in fact a few of them have been incorporated.”

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