Customer service: The good, the bad and the ugly
Providing good customer service should be at the heart of your business strategy—not least in B2B companies. In order to deliver impeccable customer service, businesses must learn from previous experiences and understand the ramifications of poor customer service. In this blog post, we’ll take a look at the good, the bad, and the downright ugly cases.
Good customer service cases
Amazon
In today’s world of continuous digital development, communication technology and higher social engagement, customer expectations are on the rise. 96% of customers in a Microsoft study say superior customer service is the most important driver to their loyalty and choice of brand.
Saying you’re customer-focused is easy, but doing whatever it takes to improve customer satisfaction like Amazon requires another level of dedication and determination.
For Amazon, second best isn’t good enough. As a result, the company has stayed on top of the Highest Rated E-Tailers List ranked by America Customer Satisfaction Index (ACSI) for 10 years in a row. Discussing Amazon’s customer satisfaction strategy in an interview with Forbes, David VanAmburg—Managing Director of ACSI—notes: “The world’s largest internet retailer has mastered a combination of value, satisfaction, and delivery efficiency that consumers love”.
Amazon has proven that success only comes to those who dare to sacrifice short-term benefits—even if that benefit may be profitability. Acknowledging that customers love fast and free delivery, Amazon developed Prime: an annual paid subscription service that offers two-day free shipping on unlimited orders with a one-month free trial period. At the time Prime was introduced in 2005, the service was criticized for being “too good to be true” and hurting the company’s profit as well as its stock value. Now though? Over 100 million customers are Prime members and their average spending on Amazon per year is nearly double that of non-Prime members.
Netflix
Video streaming giant Netflix just achieved the highest score in the 2019 Customer Satisfaction Rank by ACSI. With a large customer base of nearly 140 million subscribers (Q4 2018) and a rising number of competitors including Amazon, HBO, and Hulu, this magnificent result has not come easily to Netflix.
How has Netflix become such a powerhouse? At the core of their operations is true customer-centricity. With investment plans of $15 billion on content in 2019, Netflix is spending billions more on content creation compared to its competitors. The company acknowledges that it is worthwhile investing in quality content—what they see as the most valuable asset when it comes to maintaining customer loyalty. In fact, customers continue to rank Netflix’s original series higher than other types of content and barely showed negative responses to the company’s latest price hike.
Another contributor to Netflix’s success is their use of customer input. Operating as a monthly subscription service, Netflix bears the risk of losing customers every month. But only 9% of their 140 million subscribed users hit that cancellation button. In order to create a movie experience that keeps subscribers coming back for more, Netflix has developed a sophisticated algorithm to study customer feedback, trends, and behaviors. The company discovered that a typical Netflix user often loses interest after 60 to 90 seconds searching for the right show to watch. That’s why, based on the user’s viewing history and preference, Netflix pushes personalized show recommendations from a versatile set of 80,000 movie categories to its customers. Thus, according to Netflix, presenting the right shows to each viewer, in no time at all (whether or not us viewers will ever really stop scrolling for the ‘perfect show’ remains to be seen ;-).
This viewing suggestion tool results in many extra hours of binge-watching new shows and increases user’s ‘stickiness’ to the platform. By giving users a reason to stay, Netflix saves $1 Billion yearly in value from customer retention.
Qumulo
Being a reputable brand in the enterprise’s data storage industry, Qumulo’s secret to success is having a fully customer-centric approach throughout its entire B2B customer service effort. With the mission of providing a simple, scalable and efficient enterprise data storage system, the company strives towards building a super-power CSM team with the ability to support the customer at any touch-point.
Qumulo’s CSM team consists of online support channels such as Online Qumulo Community, Qumulo Care or Cloud-Based Monitoring combined with human service agents. A unique aspect of the company’s customer support model is the lack of support engineer role. Qumulo believes that bringing CSMs and software engineers together in the support team will deliver the best help to their customers. Thanks to this method, CSMs can work hand-in-hand with software engineers to solve problems more effectively.
For Qumulo, the CSM team is the customers’ main contact point for every issue they might have, ranging from support requests and software-upgrade questions to general product feedback. Therefore, the team is made up of employees who know the root cause of the issues, feel the pain from the customer’s perspective and interact directly with them to provide the right support.
From Bad to downright Ugly
MoviePass
With a 0.4/10 rating on Trust Pilot and thousands of negative comments on Reddit, Twitter, and Facebook, be thankful if you’ve never had to suffer through MoviePass’s customer service.
The subscription-based service allows its users to see one movie per day at an attractive price point of $9.95 a month. Unsurprisingly, MoviePass went from 20,000 customers in February 2017 to nearly 2 million subscribers in August 2018. However, the company has admitted to being overwhelmed by this explosive subscription surge and failed to deal with the larger service demand. Despite the company’s effort to expand its customer service team, MoviePass customers are left waiting for weeks to receive their cards after payment and they are desperately trying to reach the support team through all communication channels.
The vast majority of the negative comments are not aimed at MoviePass’s product specifically, instead complaints are normally directed towards the customer service department’s unresponsiveness. With more than 1,500 complaints on Better Business Bureau, the review page has an “F”—the lowest score possible—and a big caution statement on the MoviePass review section:
American Airlines
2018 was a year of unpleasant scandals in customer service practices, with airline companies delivering the most disappointment to customers. Forbes reports that American Airlines failed to deliver 30% of their passengers on time—which is the equivalent of a staggering 42 million customers in 2017. And still, the company refused to say sorry.
American Airlines’s flight attendants used to have the right to provide compensation in the form of travel vouchers, free meals or bonus miles to upset customers due to delay or service breakdowns. It turned out that the flight attendants gave out those freebies too generously without trying to calm down passengers first. Rather than being sympathetic to its customers, the company made the decision to stop compensating them and asked its attendants to stop being so nice.
Dan Reed, Airlines services expert, has a very interesting take on the consequences of American Airlines’s poor customer service policies. He argues, “Now, how many of you out there would buy a carton of milk knowing you had a 30% chance of discovering the hard way that it’s spoiled? How many would take your shirts, suits, dresses, etc. to a laundry or dry cleaners knowing that nearly a third of your items would come back scorched, with broken buttons or zippers, and/or with rips in the material? How many would buy a car knowing that there’s a 30% chance of it breaking down on the highway, stranding you within your first year of ownership?”
In today’s highly competitive market, the failure to meet customers’ expectations clearly has huge ramifications for your company. Luckily, there are many ways to ensure you don’t fall into the same pitfalls as American Airlines. The core of it? Making sure that the customer is at the heart of your business strategy. That might mean using customer feedback to help build your product, giving customer success a seat at the executive table, interacting with your customers via a community to improve engagement and customer satisfaction…the list goes on.
Whatever tactics you choose to boost your customer service, remember one thing: with so many options out there, the moment you let your customer down there is no second chance. It doesn’t matter what you sell or what industry you’re in, offering great customer service is vital.
This blog post was written by Chi Dang and edited by Ben Robinson.
