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Marketing Focus – 1. IT’S TIME – TO GET SERIOUS ABOUT SERVICE 2.CONNECTED, NOT ENGAGED – COULD BE OUTRAGED 3. ELASTICITY-PRICES: DEMAND OR LOYALTY? 4. CUSTOMER SERVICE SKILLS UNSHACKLED – I2P

Marketing Focus – 1. IT’S TIME – TO GET SERIOUS ABOUT SERVICE 2.CONNECTED, NOT ENGAGED – COULD BE OUTRAGED 3. ELASTICITY-PRICES: DEMAND OR LOYALTY? 4. CUSTOMER SERVICE SKILLS UNSHACKLED


1. IT’S TIME….TO GET SERIOUS ABOUT SERVICE

Key takeouts from the proceedings and revelations of the Australian finance sector Royal Commission are that the conduct of, “Customer First,” and similar service initiatives is superficial, lacks delegated authority for front-line providers to deliver the promises, and is not reflective of a true, underlying corporate culture of many entities.
The evidence given by middle-and senior rankings has been, in many instances, embarrassingly inadequate and projects a degree of incompetence and lack of both product – and customer – knowledge.
A common deficiency of many service excellence endeavours is the lack of thoughtful, strategic initiatives emanating from the middle ranks. In essence, many middle managers are simply channels through which communications pass to and from senior management and front-line service providers.

Contributing to, and exacerbating the issue is the narrow and shallow experience and expertise of internal and younger external customer service trainers and facilitators.
Much of the focus is on process, rather than the key components of input and outcomes.
Rudimentary entry level content falls short of needs.

Our latest attitudinal research and analysis have identified eight sequential and complementary phases in the pursuit, attainment and maintenance of service excellence.
Personal interactions between customers, clients and front-line service providers involve only four of the eight.
In matters of quality personal customer service, everybody needs to commit, contribute to and be accountable for customer satisfaction and delight.
Accordingly, participants involved in effective training, development and planning workshops and conferences are from all ranks, departments, sites and functions – including Board members.

The consequences are outstanding, quantifiable and refreshing.
Sometimes you do need to introduce a challenging – yes, possibly confronting – catalyst and facilitator for change.

A reorientation from doing things, to achieving outcomes is rewarding.

It really is time to get serious about service.

2. CONNECTED, NOT ENGAGED … COULD BE OUTRAGED

Use of Facebook, and other social media channels comes at a cost.

The attitudes, perceptions and expectations of a majority of Australians reveal it is a multi-sided coin.
Those costs have direct, immediate and long-term implications for individual Facebook (in particular) users, for advertisers of personalised targeted messages and for Facebook (among other social media channels) activists.

Many of the values and expressions of Australian Facebook users have been crystallised in recent times with the highly profiled case study of seeming abuse of personal data by the analytical consultancy Cambridge Analytica, Mark Zuckerberg’s testimony at the US congressional hearing and a general sense of outrage about the unauthorised and, often, unknown use of private data.

Most significant for businesses in general, and marketers in particular, is that a significant majority of people don’t like receiving personalised targeted messages.
Indeed, more than 60% of people simply don’t want to receive any such communications.
They feel “uneasy”, “uncomfortable” and “unsettled”.

The potential for long-term brand-damage is enormous.

Big data, meta-data and the analysis possible from the data trails left with the use of social media enable well resourced entities to effect micro-focusing of target audiences with granular market segmentation.
Sadly, in many companies – big and small – the capability of people does not match the capacity of the often expensive hardware.
Ham-fisted offers to individuals underscore the idealism of being customer-focused and customer-driven is beyond many.

Moreover, if the analysts were able to identify, isolate and genuinely evaluate the needs, wants and aspirations of Australian consumers, it would be apparent that less than 20% of adult Australians (18 years or older) like receiving personalised messages, which have been screened or influenced by reviews of their own data.

A seemingly complex web is readily reduced to three essential pillars, being:

A majority of adult Australians …

  • like to, and do use Facebook, and other social media channels;
  • don’t want their personal information shared;
  • will resist or reject any proposal to pay for Facebook, or its alternative.

For businesses which in recent times have been actively migrating their marketing and sales communications to social media – to the exclusion of the traditional and established mass media of television, radio, print and outdoor – there is an inherent, salutary message.
Take pause, review objectives, contemplate balance and review the current business model – before it is too late.
Brand name integrity is, potentially, at stake.

3. ELASTICITY-PRICES: DEMAND OR LOYALTY?
So much for lecture 1, Economics 101 and price elasticity of demand!
After some five years of aggressive, directly competitive discount pricing, Woolworths and Coles supermarkets in Australia have arrived at similar conclusions, in a remarkably parallel time frame.

They have found that in the mature $101–billion–per-annum supermarket sector discounting prices from 5% to 50% did not induce increased demand, revenue, customer satisfaction or loyalty.
Indeed, the overall consequences have been price deflation, contracting sales for each supermarket network, reduced market share and a strong measure of consumer indifference to price-based advertising.

Whether the promise was that prices were “down, down”, “cheap, cheap” or discounted, it seems consumers dismissed the promises, accepted the savings and gave little in return.
Increased purchases and loyalty were, seemingly, never a consideration by the consuming public.
During the period the sales and market shares of global interlopers Aldi and Costco increased.

Realty hits hard, particularly upon the bottom line.

Take for example the retail price of cooked whole chickens.
In 2013 they were consistently $12.00 each, and considered to be good value.
Then Coles lowered the price to $8.00 each, a reduction of 33%.
Very cheap.

Woolworths responded quickly and matched the new price.
Over a period of five years the retail price of cooked whole chickens became accepted, and expected, as being $8.00 each.
Now that both national Australian supermarket chains have begun implementing a new policy and strategy which are centred on quality, value, upgraded premises and everyday lower (not necessarily discounted) prices, chicken prices have been raised from $8.00 to $9.00 each.
That represents an increase of 12.5% in a time and marketplace where the consumer price index is increasing at around 2% per annum.

The consumer backlash has been immediate, widespread and negative.
Rip off!.

My, how memories are limited in length.
Little or no recognition is given to the fact that $9.00 is still 25% less than the prevailing 2013 price of $12.00 each.

Both networks will confront similar scenarios and reactions to any increases in the retail prices of bread, milk and eggs, which were central to the previous campaigns.
Little wonder that other businesses have difficulty with consumers accepting a return to full recommended retail prices after 60%-off sales events.
Price elasticity?
It reads well in economic textbooks.
Throughout the marketplace other forces prevail.

KEY MESSAGE:      When you get on the price discount treadmill, it’s hard to get off.

4. CUSTOMER SERVICE SKILLS UNSHACKLED 

Customer service skills are easy. But in many instances they are impeded and compromised by inadequate, superficial and narrowly focused corporate cultures.
Well scripted mission statements, philosophies and visions, that abound on display on office walls, are insufficient and often misleading.
They seldom detail and articulate the underlying driving force (which makes things happen).

As a consequence, considerable resources and funds are channelled to processes that reduce costs and seek to enhance internal efficiency … at the cost of customer and client satisfaction.
Under – and unutilised customer skills often remain, unrecognised, not valued, not supported and not implemented, by a lack of delegated authority.
This is to the detriment of unfulfilled customer advantages, benefits and rewards.

RESULT:         The importance of customer service is appreciated, but remains unrealised, to the dismay of front-line service providers and recipients.

THE STAGE IS SET 

In many ways, customer and client satisfaction is determined by, and measured against expectations and initial experiences encountered before personal interactions with key service providers.
Pre-programmed, automatic telephone systems, which often do not provide the option of immediate access to personal service professionals remain a source of annoyance, frustration, dismay and dissatisfaction.
It is difficult to recover from heightened anxiety, frustration and annoyance.
Neutralising such emotions may be deemed to be a commendable milestone – but it is a long way short of satisfaction, delight and exuberance.

A case in point is the declaration by Centrelink that wait-times on the telephone line had been reduced substantially … to around 17 minutes.
Against the benchmark of service excellence being achieved when incoming calls are answered within three rings (that’s 9 seconds), it is little wonder that the public at large is left speechless, and fuming.

Department stores, particularly those in Australia, are reporting losses in sales, revenue, profits, market share and customers.
In recent times, senior management and Boards of Directors have declared commitments to a number of customer-focused endeavours, numbered among which are training in customer services.
Such utterances fall short, well short. As do the number of available and accessible service providers.
The consensus consumer perception for the Australian department store sector is that it is difficult to find staff members.

So having highly trained, qualified team members, who possess great product knowledge count for little if they are insufficient in numbers and can’t readily be found “on the shop floor”.

REFLECT:       Excellent skills, contrasted by inadequate culture compromise customer service standards.

Successful leaders of the largest Australian mining company, BHP, do not need to be engineers or geologists.
Similarly, being an IT wonk is not an essential prerequisite to take the mantle of chief executive for Apple.

However, there is a universal need for all senior executive and non-executive ranks to be alive to the need for, and nature of customer service delivery.
Financial spreadsheets do not necessarily measure relevant performance standards.

REFLECT:       Context and ambience are as important as content to achieve satisfaction, and peace-of-mind.

ONE-TOUCH SERVICE 

The manner, and speed in which product returns, quality issues and service deficiencies are addressed and resolved are key indicators of the degree to which a positive service corporate culture prevails, and is applied by all.
A need to refer matters to another person or department mars the experience of a disenchanted customer, and possible long-term business advocate.
Delegated authority improves morale, contributes to staff loyalty, stabilises team compositions and reassures customers that they are dealing with people who are willing, and have the capacity to resolve issues to their satisfaction.

HOLD ON, NO FOLLOW-UP 

For some, follow-up to customers who have just outlaid considerable funds to do business is expensive, time-consuming and does not necessarily generate additional referrals and revenue.
Moreover, unease is common among some entities that are reluctant to expose themselves to inviting expressions of dissatisfaction from customers.
Some things are better to know first-hand.
Third-hand endorsements and complaints are difficult to manage, counter, contain or to negate.
Open, two-way communication is a key characteristic to sustaining positive relationships, client satisfaction and to achieving loyalty.

UNCOMPROMISED COMMITMENT 

Customer service initiatives are commendable, and particularly relevant at this time. Each should be universally embraced and applied.
With service excellence there is no place to hide.
However, big budget allocations alone are not enough.
Training undertaken by team members should, indeed, must, involve senior management and Board members.
Active participation is positive.
At the very least, training participants will feel rewarded, and be reassured that they have been heard when at the conclusion of the program they are able to deliver personal presentations of considered and determined action plans to senior executives and non-executives.
It’s the very least one would expect of a customer-focused/driven/centric/first entity.

THE AUTHOR

Barry Urquhart of Marketing Focus is an internationally respected business strategist, consumer behaviour analyst and conference keynote speaker.

Barry Urquhart
Marketing Focus

M:      041 983 5555
T:       08 9257 1777
E:       Urquhart@marketingfocus.net.au
W:      www.marketingfocus.net.au
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