Here is a typical customer service story that illustrates the gap between the power of modern commerce and the struggling mindset of business.
John is a retail customer, who, like many people, enjoys shopping at specific stores. He re-visits these stores often, out of habit and convenience. He recently purchased a coffee maker from a homewares store in his neighborhood just one week prior to moving house. He brought it home, but did not open it. It remained in its original packaging. Two weeks later, after moving into his new house, he found the coffee maker, removed it from its box and plugged it in. It did not work. He called customer service and was told to take it to a local affiliate – a store that was not a direct part of the chain, but that sold some of the chain’s branded merchandise.
When John arrived at the affiliate store, with his coffee maker in hand, the young sales clerk informed him that although the store was connected to the homewares chain, she was not able to accept the appliance, since her store did not directly deal with this particular brand. She politely suggested he return to the main store back in his old neighborhood. John left the store, with his coffee maker under his arm. He felt a little under-appreciated and consequently decided to switch his loyalty to their competition.
Question: what – if anything – could the young sales clerk have done differently to stop John from leaving the brand?
This type of customer service scenario happens very often. It is the end result of an absence of long-range thinking on the part of higher-ups in the retail chain, a subsequent lack of education of front-line retail staff and a lack of time. Store associates seldom have the time or the permission to think proactively.
The people who manage this affiliate store overlooked a key component of the new business economy. Even if the coffee maker was rightfully not a brand that they supported, the cost of returning it on behalf of the customer pales in comparison to what John would have left them in return: data. Customer relationships and customer data carry a far greater value than any individual transactions. Business, both in the B2C (retail) and B2B (industrial/commercial) spheres, relies increasingly on big data and analytics. This is the material that helps further individual customer relationships, spreading them out into additional channels.
Up-selling: “John, your 4-cup coffee machine is good, but have you considered an 8-cup model, so you can make enough for guests?”
Cross-selling: “John, most people who buy this type of coffee maker also buy this amazing kettle, made by the same manufacturer, with six different water temperature settings.”
Data-based selling: “John, last time you shopped at the main store, you bought a highway safety kit for your car. Do you know about our really great thermos cups? They’re perfect for enjoying that great coffee safely while you’re driving.”
Subscription services: “John, we’ve partnered with this premium coffee supplier who sends coffee by courier. Not only will you never run out, they always send an additional sampler with every shipment.”
Freemium: “John, I know you might never have tried coffee shipments by courier before, so we are happy to send the first 1-week package at no charge. You can order online if you like it.”
Loyalty: “John, if you choose to order your coffee online, maybe you want to try our loyalty app. It works on your smartphone and you get points and rewards with every purchase.”
Mobile Commerce: “John, since you’re thinking about the loyalty app, you might want to think about our full, downloadable native app that shows the specials throughout the entire store, but primarily the areas that we know you like the most, like coffee and cars. If you set the permissions, it will also know when you physically enter the store and you will get 15% off automatically.”
New Service Lines: “John, we are offering gourmet dessert preparation classes online in conjunction with a local catering school. Perhaps you or a family member might wish to sign up, to learn how to make great desserts to go with that wonderful coffee.”
The sales clerk in this scenario was only doing what she had been instructed to do, which points to a deficiency of vision in the management hierarchy. John should not have been allowed to leave the store without the clerk entering his account code to find out who he was, how long he had been a customer of the main store, and to identify and deliver these types of up-sell opportunities right there and then. The clerk should have been educated to understand that rejecting a customer for any reason will result in a high possibility of losing that customer, whereas helping him would have opened up more channels of loyalty and business.
Data is king. Customer data gives company representatives at any level the opportunity to fully understand the needs of each client/customer and to address them in a high-touch, contextual manner. That is the currency of modern commerce.
For more on this topic, please visit businessvalueexchange.com, sponsored by HP Enterprise Services.
By Steve Prentice
