Along Comes the Web


Customer service, however, is expensive. With thousands of calls per day at a cost of $2 to $7 per call, companies have seen a significant drain on their bottom line. Customer lifetime value analysis must be used to determine whether the helpfulness and relationship building is worth the cost. In some cases, companies have found that it was not paying its way. Most banks that have done profitability analyses have discovered that about half of their customers are unprofitable. A good part of the reason for the lack of profits can be traced to the expense of customer service. When Federal Express started the system that enabled customer reps to field questions on the exact status of every package shipped at any time, it was wonderful. But it came at a significant cost. If every customer called to learn the status of his or her shipments, all shipments would cost at least $2 more than they do. Using the Web has saved this money.

The Internet Saves the Day

The Internet is gradually replacing the customer service rep. Instead of paying for the cost of a toll-free call and the salary of a customer service rep who reads information off a computer screen, companies are learning that their customers can look at that same screen directly on the Internet and get the answers themselves. What’s more, customers like it better. What is the saving produced by fielding a call on the Web instead of on the phone? Between $2 and $7 per call. Banks are discovering the saving from the Internet. Transactions on the phone with a live operator cost banks $2 or more. Those on the Web cost about a penny each.

The big savings, however, come from inviting customers to come into your company to read the same screens that your employees read. Customers become part of your company family. This is real relationship marketing.

Every business-to-business company in America (or in the world, for that matter) can profit by opening up its internal company data and making them available to customers on the Web. There are three reasons for this:

  1. The Web site will probably pay for itself in savings on toll-free calls and operator time.

  2. It may increase sales to new prospects (although that is not a sure thing).

  3. It provides a way to recognize and build relationships with customers that will improve loyalty and retention.

Who is doing this? Customers use Dell Computer’s Web site to check their order status 50,000 times per week. The same calls to Dell’s customer service reps would cost Dell $200,000 per week. Dell also saves several million dollars per year by encouraging 200,000 customers per week to make their troubleshooting inquiries through the Web.




The Customer Loyalty Solution. What Works (and What Doesn't in Customer Loyalty Programs)
The Customer Loyalty Solution : What Works (and What Doesnt) in Customer Loyalty Programs
ISBN: 0071363661
EAN: 2147483647
Year: 2002
Pages: 226

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