Special attention to customer service can make a difference among shoppers. Some 80% of Americans believe that smaller companies place a greater emphasis on customer service than large businesses, and 7 in 10 are willing to spend more with companies they believe provide excellent customer service, according to an American Express study.
“This indicates that consumers are undeterred by the size of a business, even if the service or product is more expensive, as long as they receive excellent customer service,” said Zac Carman, CEO of ConsumerAffairs and founder of the Brands for Accreditation program.
Because customer service is the new marketing, CEOs of companies that pay attention to quality customer service can bring in more dollars over the life of the customer and through repeat business.
“As a start-up company selling high-end luxury goods, it is very important for me as the CEO to be involved in the customer service so that I can address the needs and expectations of my clients with the newest techniques of customer service,” said Lies Helsloot founder of Delphin & Emerence.
In fact, a customer who is fully engaged with a brand represents an average 23% premium in terms of share of wallet, profitability, revenue, and relationship growth compared to a 13% discount in those same measures for disengaged customer.
Below are five trends to watch in 2017.
Premium service is an increasing form of luxury.
“Tiered customer service will increasingly be a method that management teams use to attempt to balance the rising cost of customer service with profitability by selling a positive customer experience along with the product or service,” Carman told Newsmax Finance. Dell, for example, offers the option of customer service agents that speak American English but for an additional fee.
Dell is not alone. About 45% of loyalty programs follow a tier-based method, according to Cap Gemini.
“Service tiering creates additional revenue streams without having to create new products,” said Dwight Holcomb, president of the alumni board of directors of UCLA Anderson. “Companies can become more profitable and deliver better customer care to those who need it and it gives shoppers a sense of control to determine their own desired service level.”
Customer service by text is on the rise
With an excess of 13 million mobile app users in the U.S., Starbucks is a case study in how to further customer service initiatives by text. Some 16% of all Starbucks transactions occur on the company’s mobile app.
"SMS or customer service by texting isn't very common at all right now but as companies gain a better understanding of how to use social media for customer service, texting for customer service will increase," said John Huehn, CEO of In the Chat.
Some 36% of millennials say they would contact a company more frequently if they could text them, according to data on customer expectation produced by the Center for Generational Kinetics.
“It’s the millennial drive to share that’s at the crux of the emerging trend to use texting for customer service,” Carman said.
The millennial effect
Some 80 million millennials in the U.S. will be spending $200 billion annually by 2017, and they are vocal about what they feel they deserve when spending their hard earned money.
“Millennials, mobile technology and social media are colliding to radically change customer service as we know it,” said Carman. “They will not tolerate waiting in lines, repeating their problem to five different people or being treated like a number.”
Instead of waiting in line, millennials turn to their phones and their social media accounts. Twitter advertisers say 80% of their inbound social customer service requests happen on the social media platform.
As a result, brands are increasingly focused on creating a culture of customer service because shoppers are more empowered.
“We have a fully-staffed customer happiness team dedicated solely to making sure we deliver the best in class experience to all customers,” said Sophie Kleinert, a spokesperson with Instacart, a partner of Whole Foods.
Alternative solutions will outnumber phone trees
Companies thought they could bypass the human aspect of customer service by placing it online, through voice mail systems and automated menus, known as phone tree hell, where the old ploy of pressing “0” with or without the “#” sign sometimes still works.
But such systems pay little attention to how a customer feels and do not allow for customization, special needs or circumstances that may arise during a transaction.
“I am seeing an improved blending and balance of technology with human accessibility,” said Claudia Newcorn, a business consultant and author of Zipline to Success. “Phone trees are shortening, there is more rapid access to customer service reps and even on websites, I am seeing an increase in live chat boxes.”
While the human touch is increasingly a strong point of differentiation among smaller companies, and a retreat from impersonal telephone options is on the rise, customer service technology is becoming more sophisticated.
“CEOs are wisening up to giving their consumers secondary options to customer service by phone with simple solutions like FAQs and online how-to videos to get information more quickly,” said Carman.
The FAQs on websites, live chat boxes and customer service how-to Youtube videos are expected to lower costs because companies will only have to hire an employee to moderate them.
Holograms will replace live customer service agents
3D holograms or silhouettes of human customer service clerks will be armed with programmed artificial intelligence, voice recognition and/or webcam outlets so that customers can be assisted visually and verbally.
“The human-like capabilities of holograms will revolutionize the way customer service is managed because they will increase speed of service, versatility and further the productivity of employees,” said Mark Stevens, author of Your Marketing Sucks and CEO of MSCO, a global marketing and management consultancy.
The use of holograms and artificial intelligence is expected to lower the cost of customer service over time because companies will earn more money from higher levels of customer satisfaction and the increased ability to cross sell.
“Holograms are being created to free workers up, which allows companies to redirect money and resources,” Carman said.
New systems are also emerging which can decipher what a customer is feeling in real time and respond appropriately, such as voice recognition and mood detection analytics.
“These holograms that don’t require complex intuitive thinking could take the form of a doorman or concierge in a hotel or luxury high rise apartment,” said Carman.
How a holographic concierge or doorman might respond to an irate customer, however, remains to be seen.
Juliette Fairley is an author, lecturer and TV host based in New York.