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Today significant customer churn is an epidemic across the telecommunications industry, and as the economic downturn deepens, many in the industry recognize that improving the "customer experience" is far less costly and offers greater long-term benefits than replacing lost customers.

Research reports reveal the scope of customer dissatisfaction. According to Forrester Research, 91 percent of large and small U.S.-based companies believe that customer experience is critical or very important, but mediocre customer care has left only 50 percent of customers satisfied with their mobile carriers and cable and satellite TV providers. And nearly one-third of subscribers to broadband services from telephone companies, cable companies, and other ISPs are likely to switch providers when their customer care experience is consistently poor.

Improving the customer experience can dramatically reduce churn, which can moderate the affects of an economic downturn. This is why many telcos are seeking out technologies in a relatively new category, customer experience management (CEM), to help them remedy their customer service woes and create a single, optimal customer experience across all their contact channels. With CEM solutions, telcos can enhance their customer loyalty programs by anticipating customer needs, enabling personalized communications and recommendations, and provide the ultimate customer experience.

Specifically, the goal of CEM is to ensure that each customer experience is:

  • Tailored to the individual -- agents have access to consolidated, current information on the customer's profile and purchase history across the company.
  • Appropriate -- offers are made that are "right" for the consumer and are predicted to be accepted.
  • Dynamic -- each offer should change based on the changing needs of the customer at that moment, in real-time.
  • Unified -- the relationship should span all channels and processes that affect the customer.
CEM solutions can fully automate all customer-facing processes and integrate multiple lines of business to create a single, seamless customer experience across wireless, local and long distance service, the Internet, and television service. From opening new accounts to resolving disputes, from churn reduction to real-time offers, CEM can help telcos deliver a customer-focused experience that reduces friction, breeds loyalty, and makes customers stick.

The technology platform that makes CEM successful should include:

  • real-time predictive decisioning that dynamically enables an agent to interact with each customer on an individual basis;
  • unified business process automation that results in a single, enterprise view of the customer, erasing product, channel and process silos; and
  • a flexible enterprise platform that leverages information from existing and third-party systems during every customer interaction.
In addition to improving the customer experience, such a platform is a cost-effective way to improve business processes and increase employee productivity, an added important hedge against the economic downturn.

CEM in Action
One leading telecommunications company has used a CEM solution to leverage the detailed information in its data warehouse to target multi-level marketing campaigns at different customer segments via a wide range of delivery channels, including the Web, email and SMS. The solution has enabled the company to replace direct-mail blasts to hundreds of thousands of customers by 75 percent, replacing them with a large number of smaller-scale campaigns that communicate tailored messages to specific customer segments, resulting in significantly higher response rates.

Another telecommunications company has used CEM to tailor its services to individual customer profiles rather than grouping customers into segments based on factors such as age, sex and occupation. The company developed a solution linking relevant applications, pulling together in real-time all the intelligence and actions involved in speaking with a customer. Today, each call with a customer is now based on all the most current data, including information gathered within the call itself. As a result, response rates of less than 2 percent have increased to more than 50 percent, with an impressive sales conversion rate of 54 percent, and for certain products, even higher.

In the face of troubling economic times, new CEM systems have been proven to increase customer loyalty and reduce churn. According to Forrester Research, most North American firms plan to boost spending on customer experience in 2008. When exploring CEM solutions, look for a flexible enterprise platform that will enable you to unify business processes across all channels and enable agents to interact with each customer on an individual basis. Deploy, and explore the profits next.


About the author
Frank Florence is vice president and CMO of Chordiant Software (NASDAQ: CHRD), a provider of customer experience (Cx) software and services. He can be reached at Frank.Florence@chordiant.com.

Please note that the Viewpoints listed in CRM magazine and appearing on destinationCRM.com represent the perspective of the authors, and not necessarily those of the magazine or its editors. If you would like to submit a Viewpoint for consideration, please email viewpoints@destinationCRM.com.

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