The Marketleap Report
Volume II, Issue #6 - March 26th, 2002

From Purge to Surge
How customer service completes the marketing cycle online
By Keith Boswell

Customer acquisition is a hot topic for growing businesses online. Marketers look to the meadows of green customers grazing on the Internet and salivate. Cost-per-acquisition is a hot topic as companies look to effectively manage their cost to attract new clients. But what about keeping your customers once they get there? If you look at the survivors in the market, customer service completes their marketing cycle.

When business began the great migration online, the last group to straggle into camp was the customer service reps. The other departments were already sitting around the fire, their bellies full, singing songs of wealth and future glory. While everyone was busy dreaming up new models for businesses online, many were ignoring the cost it would take to keep their customers happy.

For the majority of online businesses during the late nineties, email sent to customer service addresses languished like deflated bike tires in an old shed. Repeated requests for help were often met with lifeless responses promising further follow up at a later date. I remember talking to someone who was thinking of opening a business to just answer email information requests from all of the businesses they knew of that did nothing with incoming information requests.

Luckily new research suggests that the businesses that survived The Great Purge are working diligently to improve customer service. In January 2002, Giga Information Group released a study that showed considerable improvement in online customer service in the fourth quarter of 2001.

Giga looked at fifty of the top retail ecommerce sites in the US. Their findings showed that the average response time to email inquiries fell by 37% between the third and fourth quarter, down from 19 hours in Q3 to 12 hours in Q4. By keeping the communication flowing, companies are enabling their customers to do better business with them.

It's not just communication though. The ease for a customer to do business with you is just as important. A mystery shopping excursion by the Direct Marketers Association (DMA) provided some interesting statistics into how businesses are learning from market leaders like Amazon. The DMA purchased one item from each of one hundred US retail sites during the busy holiday season.

Their researchers found:

• Companies are making it easier for consumers to buy, with the average number of clicks to checkout reduced to 5.36 clicks from 8.76 clicks one year ago.
• 54 percent of sites offered real-time inventory status, compared to 42 percent a year ago.
• 46 percent of sites offered gift search features, compared to only 14 percent last year.
• Privacy is a priority, with 90 percent of sites linking to privacy policies directly from the home page.
• 80 percent of sites sent e-mail shipping confirmations, up from 54 percent in 2000.
• 79 percent of sites enabled customers to check their order status online.
• 99 percent of sites provided toll-free numbers for customer service.
• Orders were successful on the first attempt on 93 percent of sites, showing that merchants have improved infrastructure to meet growing demand.

These top retailers represent just a fraction of all of the business being done online. That's why it's so important to highlight customer service. Successful companies are ensuring their customers get everything they need to continue being a customer in the future.

I often hear people say that technology required for a solid customer service system costs too much and is too difficult to implement. Budgets are tight in general, but when you compare what some people invest in marketing versus infrastructure upgrades and enhancements, it can be laughable. You can go out and buy all the customers in the world. But will they still love you in the morning?

Then you'll start to ask yourself why she isn't coming back. Why did she unsubscribe from my newsletter? Why isn't she responding to my latest email campaign? Now take a step back, send yourself your own marketing material, and go and make a purchase. Send an information request to find out more. What does it feel like?

If you feel like a dazed cow, looking around for the prankster that tipped you, it's probably time to reevaluate your online model. Buying customers isn't going to help anything. If on the other hand you are rewarded with an easy transaction followed up by good service, you probably have the mechanisms in place to succeed with your clients. Now you can feel safe to look out over the great plains of the Internet and find the customers that were meant for you.

report@marketleap.com.