The start of a new year brings many service organizations a headache.
Whether you are dealing with an organization in planning mode that is purchasing new services or a consumer who received a new product as a thoughtful holiday gift – the prospect of growing your customer base is exciting, but generally means at least an initial spike in live contact volume while you onboard new customers and answer their questions.
And while many may believe that new customers come with a blank slate, research shows this isn’t always the case. CEB, now Gartner, discovered that only 47 percent of what happens in a live service interaction determines the customer’s perception of that encounter, regardless of whether their service issue was resolved or not. So, what else is influencing interaction outcomes?
The Past Matters – A Lot
The truth of the matter is customers come into each service interaction with the remnants of their past experiences of that service organization as well as every other company they’ve interacted with in the past. Some aspects of these previous experiences are pleasant and others are not.
Like it or not, your company creates this “customer baggage,” which customers carry with them into every interaction. In fact, 53 percent of the customer’s rating of their service interaction is driven by something that happened before the actual interaction – such as the customer’s perception of the company’s service capabilities, perceived value of the company and any previous interactions they had with your company.
As you can imagine, this baggage has an enormous impact on customer interaction outcomes and shapes most of the customer’s evaluation of future interactions, whether it’s with your company or any other. Baggage isn’t pretty but it is the reality that service organizations have to face.
And unfortunately, almost all customers have baggage. Our research finds that 92 percent of customers reported having at least one form of customer baggage coming into a service interaction.
Don’t Let the Baggage Get in The Way
While many reps recognize that customers have baggage, they actively avoid addressing it because it can be difficult and uncomfortable. But it turns out that customers actually want their “baggage” to be acknowledged, as it demonstrates that the company knows and understands them. By ignoring customers’ baggage, reps further frustrate customers who feel they have to start from square one each time they contact the company.
Our research shows that when reps proactively handle customer baggage – by first picking up on or probing for clues that indicate baggage, acknowledging that this baggage exists, and then quickly moving forward to take ownership of the issues and build customer confidence in the next steps – it improves the customer service experience, lowers customer effort and reduces the likelihood of callbacks.
The Returns of Baggage Handling
When reps handle customer baggage, many key customer metrics improve. In fact, the Customer Interaction Outcome Index, which is a compilation of several common customer metrics including customer effort, customer satisfaction, Net Promoter Score (NPS) and quality of service, see meaningful improvements. Effective baggage handling resulted in a 48 percent increase in these metrics, and customers reported a 14 percent reduction in perceived customer effort in the next interaction.
Beyond the hard metrics, baggage handling has a profound impact on the customer’s perception of the interaction, and often times creates a more positive interaction not only for the customer but also for the rep. After all, it takes a thick skin to be on the phone with cranky customers all day.
Savvier customers and more complex issues continue to drive interactions beyond standard issue resolution. These interactions have resulted in customer baggage; but, when service organizations are aware of this baggage and address it, they can reap considerable improvements in valuable customer outcomes.
Your Next Steps
To overcome this challenge, there are two key steps every service organization should take:
- Enable your frontline reps to handle baggage: It’s important to make it easy for all reps to handle baggage effectively. Some tips include: identifying your reps who naturally manage baggage and help others emulate their specific behaviors; incentivizing reps to record customer baggage surfaced during an interaction for future use; and designing systems and tools to help highlight that existing, known customer baggage for a rep during an interaction.
- Reinforce baggage handling as a standard activity for reps: Baggage handling must be integrated into training, coaching and measurement so that it becomes part of the frontline rep’s workflow. It’s important to not only initially train on baggage handling behaviors, but to follow that up with individual coaching to close rep gaps, and consistent measurement systems that reward high-quality baggage handling.
Lara Ponomareff is customer contact practice leader at CEB, now a unit of Gartner.