Monday, November 28, 2011

Customer Service Analytics: Metrics You Should be Tracking

By Jace Modavi

Traditional customer service metrics are ineffective in today’s world of social networking, Internet blogs, and instant communication. Nor are marketing programs that focus on attracting new customers necessarily the best approach. Yet many businesses still base their key measurements on increased sales and first-time buyers.

Revenue changes are, of course, still one of the metrics you should be paying attention to. However, there are many other factors that should be included when it is time to analyze what these results actually mean. Only by taking the complete picture into account can you make the proper decisions.

One area that is often overlooked is an evaluation of the nature of the issues handled by the customer service department. Are there an inordinate number of requests for information that you could handle by posting the information on your website or including in the instructions sent with your product? Are they primarily related to one fulfillment center or one sales representative? Is there a particular product that seems to cause the most problems? Your cloud-based customer relationship management solutions should be running automatic reports so that you can determine these things—and if they’re not, then you need to find an application, or build one, that will give you those reports.

Another important metric is the number of contacts required to resolve an issue. In a perfect world, all issues would be handled on the first contact. Well, actually, in a perfect world, there would never be any issues, but since we don’t live or conduct business in an ideal environment, problems will arise. You need to know how efficiently they are settled, because this leads to another metric you need to track, namely customer retention. Poor customer service, in the form of inadequate issue resolution, can have a dramatic impact on how many repeat customers you have.

Your customer service department is your eyes and ears, a liaison with your customers that you need to evaluate. The facts and figures they funnel to you can factor heavily into other metrics, such as the cost of an individual customer, the lifetime value of a customer, referrals and more. Listening closely to customer service feedback will also give you insight into product research and development, marketing, and sales.

Practical Application
Monitoring the right metrics enables a company to respond better to customer issues. The desire to do just that was not possible with New Jersey Transit’s old system. The agency oversees all bus, light rail, and rail routes in the state. With over 250 million riders annually, it was natural that there would be complaints—after all, people have been complaining about buses since the first person stepped onto the first public bus, and it’s a safe bet to say that they complained about stagecoaches before that.
What was holding New Jersey Transit back was the fact that there was no system in place to track the nature of the complaints or how long it took to resolve them. When a complaint was received, the customer service desk responded by email or phone call, and records were scarce. There was no overall picture that management could use to improve service.
They began with a Web site interface that would turn a customer complaint into a case file for customer service to handle. One thing this eliminated was multiple responses to the same complaint, since actions could be noted in the file. New Jersey Transit was also able to measure complaints and commendations regarding employees, so that they could better train and reward their staff, weed out the bad apples, and offer improvements in customer service. As a result of streamlining the customer service department, all aspects of the business became smoother. Customers could track their cases, customer service reps had an easier way to view, archive and follow up on issues, and everyone was able to focus on problem resolution rather than problem administration.
Your business can do this too. A cloud-based customer relationship management system will help, as well thinking outside of the box when it comes to your metrics and benchmarks. You can no longer afford to bury your head in the sand and look only at the sales figures—there are too many other factors that are as important as those numbers.