Assessing the Impact of a New Online Customer Service App

Introduction to Online Customer Service Applications

One of the most essential aspects of any new Customer Relationship Management (CRM) system is the ability to connect with customers and support them on a 24/7 basis. In addition to the cost advantages of customer service automation, customer satisfaction has also been shown to increase when applications are based on a company's databases and knowledge management systems and are designed to better serve customers (Liew, 2008). Customer service automation is an essential component of any CRM system (Regan & O'Connor, 2002) and is often deployed across all selling and service channels a company uses, including telephone voice automation, online web channels, and in-person store interactions. The focus of this analysis is on the online web channel. "Customer service automation focuses on serving the needs of customers after the sale and entails operations such as call centers, technical support, and customer service operations. Enterprises seek solutions that enable them to address customer questions, problems, or issues effectively and efficiently" (Regan & O'Connor, 2002). Introducing a new online customer service application requires taking into account the technological, process-based, and — most importantly — human-based factors that will ensure its success and high level of adoption.

For any Information Technology (IT) initiative to succeed, it must account for change management considerations and create corresponding strategies to ensure adoption and use of systems (Regan & O'Connor, 2002). This is especially true when moving customer service applications and processes online. Despite the prevailing assumption that people resist being directed to online customer service applications rather than speaking with a live agent, research has shown the opposite when excellent change management strategies are put in place. One study found that when a financial institution implemented the necessary change management processes, it actually attracted an entirely new customer base that had specifically been seeking online banking functionality it could not obtain from its existing bank (Campbell & Frei, 2010).

Research indicates that what differentiates successful introductions of self-service applications online is the ability of marketing campaigns — aimed at both existing and new clients — to account for their unique needs rather than assuming everyone shares the same problem (Berger, 2009). From a technology standpoint, this translates into designing the web or online self-service application to allow for greater role-based and preferences-based navigation of service options. It also means defining service selections in a way that aligns the company's knowledgebase to specific customer needs (Reychav & Weisberg, 2009). Web-based customer service applications that fail do the opposite: they assume no variation in roles, no difference in preferences, and no variation in the nuances of users.

From these comparisons, several best practices emerge for introducing an online self-service application successfully. First, an electronic platform that is scalable and agile enough to allow for role-based definition and the selective use of knowledge by role is critical (Reychav & Weisberg, 2009; Liew, 2008). Second, giving users control over how they define their preferences and workflows — rather than freezing or ignoring this functionality — is critical for achieving a high level of adoption. Third, continual refinement of system features, functionality, and usability is equally important. All of these elements together are critically important for any new web-based application to be adopted and used frequently by customers over time.

From a purely strategic standpoint, taking all of these considerations into account is itself an excellent CRM strategy. It communicates to customers that they matter enough to warrant flexibility and intelligent integration, rather than a one-size-fits-all approach to online customer service.

Proving the Added Value of Online Customer Service and CRM

There are immediate financial benefits to moving customer service applications online, as the costs of running a call center drop sharply when the majority of customers turn to web browsers rather than telephones. At first glance, online self-service applications appear to be primarily a cost-reduction strategy with unproven revenue-generation potential. In fact, many companies — from major global airlines to retailers and cable providers — aggressively up-sell additional services during telephone hold times using voice-overs, netting increases in sales of 35% or greater (Campbell & Frei, 2010).

Proving the value of online customer service applications through reduced per-call handling costs, increased revenues (Campbell & Frei, 2010), and customer satisfaction measured using the SERVQUAL methodology (Mengi, 2009) together explain why the majority of companies today are investing in this technology. The lessons learned regarding successfully navigating change management challenges (Regan & O'Connor, 2002), however, must also be factored into the valuation of these strategies. As customers begin to change their expectations of a service provider, there is a corresponding increase in anticipation and demand for ongoing innovation. This is because early adopters of online self-service applications will often switch service providers to gain access to next-generation technology (Campbell & Frei, 2010).

Taking all of these factors into account — from cost reduction to revenue generation, from SERVQUAL-based customer satisfaction measurement to the development of state-of-the-art services that attract entirely new customer segments — all outcomes can be tracked online through web analytics and a Return on Investment (ROI) can be calculated. Ultimately, achieving critical mass in terms of adoption is what will make or break an online self-service application more than any other single factor. Because performance can be measured continuously through online analytics, it becomes unequivocal whether an online self-service application has been successful.

Conclusion

The introduction and support of an online self-service application is a multifaceted and highly coordinated strategy that requires system and process integration to be successful. The support for role-based access and preference definitions is also critically important, as consumers increasingly expect this from their online applications and will often reject those that assume a one-size-fits-all mentality in their design. Finally, gaining user input and designing with consideration for user needs is crucial for effective change management to occur.