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The reinvention of customer care

Ron Hofer

Chief Experience Officer, SYZYGY AG and Founder & Partner, USEEDS

Ron.Hofer@useeds.de

The reinvention of customer care 

Rethinking KPIs for long-term satisfaction

Too many companies still approach customer relationship management (CRM) with a self-centric perspective, and see customer care as a cost center rather than the backbone of customer relationships.

Here are eight ways we should use customer care as a valuable business driver to create deep customer relationships.

1. The long-term value of customers is underestimated

As soon as the salesforce tag switches from “prospect” to “new customer”, the treatment switches from “Prince Charming” to “McKinsey”. That is why customer requests end up at an external call center far from the core of a company. In these times of “everything as a service”, we experience a renaissance of deep customer relationships as the prerequisite for economic success. Why? Because today, customers can decide on a daily basis whether to stay with you or leave. Marketing budgets need to be reallocated towards deep customer relationship programs. Within this context, customer care will be finally seen as what it actually is: a value center.

2.   In-sourcing customer care – a competitive advantage

There is that German saying, “every piece of feedback is a gift”. Digital companies do not believe in five-year plans. They continuously improve their products and services in so-called “sprints”. Continuous customer feedback is mandatory for this agile way of offering continuous improvements. And customer feedback is there for free; you only have to listen. Customer care means getting feedback on your products and services. Customer care needs to be an integral part of product and service-development teams.

3. The slow death of self-service

In recent decades, self-service options for customers have been a popular way to reduce operational costs and, initially, customers were fascinated by the new transparency, speed, accessibility and that feeling of autonomy. Today, though, self-service creates frustration. Leave the dialogue with your customers to automated systems and your customers will leave you. AI-based systems might make a difference in the future, but don’t even think of letting today’s AI-based systems be trained by your customers. We are experiencing a new interpretation of “the customer is king” – could you ever imagine a king trying to deal with a self-service system?

4. Customer is king – here comes his entourage

Even though debates about personal data still rage, digital assistants are becoming increasingly popular in Germany. As a consequence, companies will experience a decrease in direct dialogue with their customers – to be replaced by an increasing relationship with customers’ digital assistants. Customers send their “digital entourage” to browse and shop for them, turning B2C business into B2E business (Business-to-Entourage), and customer care into entourage care.

5. CLV - the ultimate KPI for business success

We can only improve what we can measure. Maybe this quote is the reason why we still connect business success with marketing KPIs like the number of new customers, or the costs per customer acquisition, but not the increase in customer lifetime value (CLV). Many companies talk about it, but only few actually apply CLV. CLV means the sum of future benefits the company can expect from a customer relationship, which allows to vary customer care based on the CLV of a customer - from an efficient AI-based approach to cost-worthy personal assistance.

6. Customer care becomes omnipresent

Technology enables customer dialogues at all touchpoints that customers have with brands. In the near future, Siri will help me with my iPhone, I will have my car explain how I should use it, and websites will guide me with a screen-sharing AI assistant. Customer care can be so much more than solving problems over the phone.

7. Customer care is ‘sales as a service’

Customer Care will dissolve into all organizational units having the potential to orchestrate all digital touchpoints with customers, also the ones Marketing used to own. Customer Care could holistically design and manage deep customer relationships and be a wise, seamlessly communicating assisting partner to the Customer. Companies investing into deep customer relationships are creating a long-term competitive advantage hard to compete with.

8. The rise of ‘white pattern’ business

With the Nobel Prize winners in Economic Sciences, Daniel Kahneman and Richard H. Thaler, we saw a rise in data-driven behavioral economics - unfortunately most often applied to so-called “dark patterns”, which make customers act to the benefit of companies. Or should I say, “short term benefit”, as those customers will try to leave or trick back in the long term. For deep customer relationships, we need the opposite - “white patterns” - in which the customer experiences a “retainer” of benefits, trust and value, making them a loyal, long-term customer.    

These eight points are all part of one big paradigm shift across industries, from transaction-oriented to relationship-oriented business models, in which the depth of a customer relationship is the ultimate key performance indicator for long-term business success. Customer care could play a leading role in this.