Back in the 20th century if you had a bad customer experience, you expressed your disappointment at the point-of-sale, left in a huff, and possibly told your family and maybe even a neighbor in your driveway about how poorly you were treated. Today, when a customer has a bad experience with a company they do business with, they might still cease to do business with that company and tell their family and their friends. But in today’s world, their friend is their fellow Facebook subscriber.
What does that mean to business today?
Today’s dissatisfied customer can tell all their followers on Twitter, friends on Facebook and connections on LinkedIn. Plus, YouTube provides a video way to vent frustrations.
16% of customers have already vented about negative customer service interactions through social channels. Social media has changed the influence of our voice to the companies we do business with.
What is Social Media?
Social media can be defined broadly as any method of using the internet to facilitate a “one to many” conversation. Social media includes networks like Facebook and Twitter but also online communities, podcasts, RSS feeds, wikis, message boards, videos and more.
And don’t forget blogs! Blogs also have a strong community power to share experiences and opinions. Blogs use subscribers to share their message and many have developed loyal followings. As an example of influence, Universal McCann reports that 34% of bloggers post opinions about products or brands with 77% of all active web users regularly reading blogs. Blogs also allow readers the opportunity to reply with their opinions and reactions, further extending influence.
So why does the change in your voice matter? Loyalty brings profitability. Profitability begins in year 3 of the customer/vendor relationship when acquisition costs to obtain new customers are not offset until the end of year two. Business spends significantly to identify the best prospects, build brand awareness, package attractive introductory deals, advertise the promos, secure the customer, process the transaction and deliver fulfillment in the initial stage of building the customer relationship. When these expenses are compared to profit margins in the first year of transactions, the profit is often marginally offset by the acquisition cost.
A Gartner 2009 study identified a significant change in customer buying habits. For the first time, the most compelling influence to a customer’s buying decision is not industry analysts or buyer’s advocacy reviews. It is certainly not media ads – only 14% of consumers believe them that’s when not fast forwarded on the DVR. The primary influence factor is input from friends.
Why is it important for businesses to know about social media?
The most popular internet search sites today are Facebook and YouTube with 25% of search results for top world 20 brands as links to user-generated content. Social media provides an opportunity to control the message about your products and services.
Social media offers marketing opportunities and the opportunity for improved customer relationships. Using social media in conjunction with customer contact presents high risk and opportunity for high reward. Many companies have experienced negative customer response from short-sighted or poor interactions across social media. Even a non-response to a social media post can develop into a social maelstrom.
Customer interaction has a direct impact to corporate market value. A recent Watermark study shows that, over the past 4 years, the top 10 companies which in deliver positive customer experience have seen an average increase in stock value of +19% compared against a 46% average loss in stock value of the bottom 10 companies who did not.
To achieve positive customer experiences, it’s important to provide a consistent level of service and information regardless of how the customer reaches out. Inconsistent information creates dissatisfying customer experiences, which undermines the loyalty objective described earlier.
The easiest way to ensure consistent service that breeds the desirable customer experience is to unify social network support with traditional contact centers. To do this effectively and efficiently, AT&T recommends developing a holistic plan for customer contact using experienced resources, such as AT&T Consulting. Holistic strategies for customer contact should include social media to maximize opportunity while minimizing risk.
In upcoming posts, I’ll detail best practices in using social media for customer interaction. If you are attending the Contact Center Association Conference & Expo in Phoenix where I’ll present on social media use in customer contact, I welcome further and direct discussions on this topic and how AT&T Consulting might be able to help you.