4 Ways to Transform Customer Service Experience in a Digital World

Customer Service Transformation

4 Ways to Transform Customer Service Experience in a Digital World

By 4 Minute Read

Customer service often evokes a passionate response in people as they immediately reflect upon a recent terrible experience they’ve had or perhaps an ongoing issue they’re still battling with. Think of a healthcare provider, insurance company, cable or utility company or even a recent travel experience, and most of us can point to something obvious that we feel has not changed on the service front in the last 20 years. Very often we hear complaints about the customer service experience getting continuously worse and how “in the old days” it used to be better. For instance, it used to be easier to contact companies – today, try finding a phone number to contact a provider on their website or on the Internet, and more often than not it will take you 5-10 minutes to find it (if you’re lucky). So, how important is it for companies to transform customer service experience? Some would say those that don’t will ultimately fail.

It’s interesting that with talk of digital transformation all around us, it’s obvious that customer service has glaringly been left behind. Evidence would suggest that service has not kept pace in terms of technology advances that drive improvement and increased customer loyalty. Research shows a number of trends and changes in consumer behavior and expectations, primarily driven by mobile, that make the customer service experience an area ripe for true digital transformation (as opposed to Digital Transformation or Digi-washing which is often just lip service).

Below I’ll detail some of the trends that have come together to drive this opportunity for business and how you should think about them as it relates to your core strategy for evolving customer service experience.

1.Make a move towards messaging for customer service.  Your customers already have.

Messaging has become the medium of choice for consumers in their day-to-day communications (especially that way too-oft mentioned segment, millennials.) The market has seen a steady rise in messaging apps to the point where they are overtaking social media apps[1]. This can be seen particularly when looking at millennials, as research points to the younger generation’s overwhelmingly preferring messaging (over other channels) when they talk to businesses 2. Overall, mobile voice revenues are on the decline in saturated markets like Japan and the USA while messaging, especially from over-the-top providers like WeChat and WhatsApp, is going through the roof 3. Even email is on the decline, being supplanted by modern collaboration tools like Slack for internal use, and by the move to messaging for external use. Despite the market shift to messaging, contact center infrastructure is optimized for voice-based services (with email as a secondary option). Offering support for these services only during limited hours of the day often results in long wait times during peak hours. Outdated infrastructure and new channels like messaging are the perfect recipe for disruption. Companies that fail to think with a digital mindset for customer service will be left behind in favor of brands that do.

2. Move towards a more agile business culture. It’s required for survival of the fittest.

We often hear about Netflix as an example of a brand that successfully disrupted traditional TV networks and broadcasters. Similarly, Uber and Airbnb are often praised for transforming the taxi and hotel space by recognizing and solving unmet needs. Just look around – you’ll find there is a significant move towards more agile business processes and strategy, with technology being leveraged as the key enabler of this change. Customer service organizations should not be exempt from this movement towards agile and will need to evolve promptly if they wish to keep up with changing consumer preferences, rapidly evolving products and services, increasingly complex customer queries, and new channels of communication such as home digital personal assistants like Amazon Alexa, Google Home and Apple’s new HomePod. The emergence of the Smart Home means consumers (and devices themselves) will have new and varied ways of communicating, and thus new options for connecting with the companies from which they require service. McKinsey and Company wrote, “a smart home is where the bot is.”

3.Move towards cloud-based SaaS services for greater agility and cost control.

Cloud services come at a fraction of the cost of traditional on-premise software and can be set-up almost instantly, and without much assistance. The digital transformation taking place around us has been made possible due to this fundamental shift in technology as the data center moves to the cloud and the cost and speed of delivering new software applications plummets. Best practice companies leverage technology that hones competitive advantage, and they buy other supporting SaaS services when and where they need it. They recognize that nimble companies can innovate faster and cheaper in non-core areas and this has led to a significant reduction in the cost of software. Often, the business case for replacing legacy software can come purely from eliminating expensive annual maintenance and support fees associated with legacy software – and the simple calculation coming from the realization new modern SaaS services can often be delivered for less than the ongoing maintenance costs of older systems.

4. Put Artificial Intelligence (AI) at the heart of your customer service experience strategy.

Everywhere you look, you’ll see evidence of the emergence of Artificial Intelligence (AI) and the availability of open source software from companies like Google and Facebook. Over the last few years, the rise of AI technologies in our everyday life has been spectacular – your smartphone is a veritable trove of AI applications, ranging from natural language applications like Apple’s Siri and Google’s Assistant, Cortana, to image recognition apps like Facebook and various other social, shopping, travel and music apps that make custom recommendations and predictions based on machine-learning algorithms. Although AI has been around for about the last 60 years, it is only recently that it’s developed the processing power to handle the software algorithms (which have been open sourced by companies like Google and Facebook), the data volume (machine learning needs lots of data to “train” the algorithms) and the network bandwidth necessary to transport the data (to and from mobile devices) in order to make AI applications available to everyone.

The firm Andressen Horrowitz predicts that all machine learning or some other AI component will be a feature of all software in the future4. And if there is one thing customer service offers, it’s lots of user feedback and data that can be used to help to make products and services better. Customer service is one of the fastest growing applications for AI, and together with the change in consumer preferences for contacting customer service, the need for business to be more agile and the shift towards lower cost SaaS services, there’s no question we think that customer service is one standout area that can truly benefit from digital transformation.

In our next blog we will look more specifically at what this digital transformation for customer service experience looks like and how the future of customer service will be defined by changing responsibilities and new channels of interaction.

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