Using Your Own Customer Interactions To Improve Your Marketing

I had a conversation this week that reminded me of an article I wrote in 2002 when I was doing some consulting work for Island Data (now Overtone.com which was recently acquired by KANA).  Fortunately, the article lives on in the Greater China CRM website (GCCRM.com) including a picture of a ‘youthful’ me.

It is interesting to read this article almost 9 years after I wrote it as so much has changed and is now taken for granted.  Even more interesting is that the 4 recommendations I make at the end of the article are still applicable today – except that it is much easier in 2011 to listen to customers using any of the now-common social media channels.

  1. Analyze the content and intent of Web-based customer interaction information from email, chat and the Web in near real-time
  2. Identify and categorize opportunities by segment (new sales, cross sales and up-sales, and retention or attrition risks)
  3. Take action immediately by pushing the leads and information to the appropriate group, channel, database or other software for execution
  4. Review and measure the results of the actions taken and learn from the experience

In 2002, interacting with your customers consisted of email, chat and maybe some web channel discussions on forums or comments.  And it was not easy to discern the tone or tenor of those conversations without a great deal of manual effort or through a tool like what Island Data was then selling to automatically scan and categorize customer interactions.

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Here is the complete text of my 2002 article:

Using Your Own Customer Interactions To Improve Your Marketing

There is so much going on in the CRM world these days that it is easy for some of the simpler ideas for improving your bottom line to go untouched. Worries about profitability and growth, integrating multiple solutions and customer views, analyzing and segmenting customer data, acquiring and retaining customers, reducing costs and meeting customer satisfaction goals all set in an environment of downsized corporate budgets could make executives overlook the obvious.

Communications Are Probably Ending Up In A Black Hole Or Dead End

If you are like most companies, you are wasting your best source for identifying new leads, cross-sales, up-sales and customer attrition risks. And it’s your own information that has been freely-offered by your customers and prospects.

What I mean by wasting is that your customers and prospects are trying to communicate with you – and their communications are probably ending up in a black hole or dead end. A majority of your customer and prospect contacts originate in the Service Channel via email, the Web, or customer forums and chat rooms. For many companies, the Service Channel is only seen as a cost or operational center and is often viewed in less than positive terms. Like oil and water, Service Operations generally do not mix with the Sales and Marketing sides of the business.

A Simple Categorization Of The Evolutionary Continuum 

Heads in the Sand – These companies have not made customer service a priority and do not offer multiple access methods for customer inquiries, such as email or self-service from their Web sites. If they do answer email, they do so sporadically and in an untimely process. Most companies have moved beyond this stage.

Cost Growers – These companies have started to realize that service interactions are a critical ingredient for customer satisfaction or that they have to offer multiple means for customer contact to match the competition. Many have addressed the issue by hiring more people to answer customer inquiries in their contact centers. Unfortunately, these companies do not have their eye on the bottom line and their profitability suffers as costs spiral out of control.

Cost Avoiders – These companies “get religion” on operational cost control – and usually, the zeal for eliminating or avoiding costs comes at the expense of customer satisfaction. More often than not, the goals of cost reduction are only on paper and the planned reductions of staff and increased productivity never materialize.

Enhancers – These companies really get it, and unfortunately, many companies will never make it to this stage. The Service organizations in these companies are cooperating with the Marketing and Sales organizations to present a unified front. They answer routine emails and questions automatically and efficiently, they escalate service issues promptly, they capitalize on sales and attrition opportunities in near real-time and they use the intimate knowledge of their customer interactions to improve their products and services.

The “Enhancers” listen to what their customers and prospects are telling them. In this final evolutionary state, customer satisfaction will improve substantially and profitability will dramatically increase.

6% Of Their Daily Email Volumes Relate To New Sales Opportunities

Preliminary statistics from one company who conducted tests in this area have identified that 6% of their daily email volumes relate to new sales opportunities. And by rapidly pushing the opportunities to an outbound call center staff (in ?almost? real-time), they have were able to positively contact 25% of the prospects and converted 60% of the contacts into closed sales. This conversion rate is more than 10 times the typical response rate of 2 to 4% they had achieved using more traditional sources for prospects.

To date, very few companies have made it to the ?Enhancer? stage for three major reasons. First, very few companies have realized that there is so much potential in their own service information due to organizational blinders and structural impediments. Second, it is difficult to analyze the intent or content of customer service interactions in real-time, and very few vendors offer robust solutions with this natural language capability. Finally, most companies are ignoring the obvious possibilities of their own service data because many think they need to invest in an expensive, sophisticated and time-consuming solution.

The Keys To Turning Customer Interactions Into Better Marketing

  1. Analyze the content and intent of Web-based customer interaction information from email, chat and the Web in near real-time
  2. Identify and categorize opportunities by segment (new sales, cross sales and up-sales, and retention or attrition risks)
  3. Take action immediately by pushing the leads and information to the appropriate group, channel, database or other software for execution
  4. Review and measure the results of the actions taken and learn from the experience

Capabilities and demand for these types of solutions will explode in the near term – make sure that your company is not left behind in this area. Start by asking some of these leading questions to gain a deeper understanding of the gaps in your organization:

  1. How do we currently obtain prospect information? What is the typical response rate from those sources? What do those sources cost?
  2. How do we or can we identify sales opportunities in real-time? How do we find cross-sell and up-sell leads in our existing customer base?
  3. Do the Marketing and Service organizations in our company talk to each other? Does our Service organization give cross-sell leads to Marketing?
  4. How do we identify customer retention risks? How do we address the potential risks? How quickly do we respond?
  5. How do we measure or improve the sales closure rates or effectiveness of your campaigns?

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