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CRM Case Study: Orbitz Losing Customer Loyalty, SAP's Third Wave of CRM, Chep Contact, Todor's Addicted Customers

September 27, 2006
By David Sims
david@firstcoffee.biz

The news as of the first coffee this morning, and the music is Elton John's Captain Fantastic and the Brown Dirt Cowboy:

German CRM vendor SAP AG has announced the availability of the third wave of its SAP CRM on-demand products, hitting the product target set in February.

With the new SAP Service on-demand, service managers can consolidate and track service tickets, establish rule- based escalations for follow-up and "better adhere to service-level agreements."

SAP also introduced capabilities for the existing SAP CRM on-demand products, including new sales automation features for product and quotation management. The new customer service capabilities in the SAP Service on-demand product include:

Service Ticket Management. This allows service agents to manage customer service tickets comprehensively and comply with service-level agreements. It enables multi-level categorization, rule-based service-level determination and due-date calculation, as well as rule-based service ticket distribution to service teams.

Rule-Based Service Ticket Distribution. This enables service ticket distribution based on priority, status, product and account type.

Service Level Monitoring. This helps agents specify the business time frame of service availability to track and improve compliance with service level agreements.

SAP is also introducing improvements to the SAP Sales on-demand product, including product support, which allows detailed product information to be uploaded from and integrated directly into mySAP ERP, enabling product definitions and attributes to be easily accessed and leveraged in all facets of sales, marketing and service processes.

Silverado Press has announced the publication of a new book by John I. Todor, Ph.D., titled Addicted Customers: How to Get Them Hooked on Your Company, now available in printable eBook format.

How do you get customers hooked on your company? Todor's book gives some guidelines, beginning with some fundamental psychological principles for building trust and loyalty in business relationships.

Addicted Customers is part of what's being called Customer Experience Management (CEM), evidently the CRM buzzword's lived past its shelf life, because contentwise there isn't any appreciable difference between CEM and what we've been doing in CRM for years.

The differences are of emphasis: CEM practitioners typically place heavy emphasis on making the selling environment more appealing, which is an essential first step. Todor adds a psycho-economic framework to enhance these pursuits, and shows, through many examples, why companies need to recognize the "emotional power of the customer experience."

Addicted Customers spends time providing a "strategic platform to apply CEM to product/service consumption," the aspect of experiences Todor considers "critically important to customers." According to Todor, loyalty accrues because customers value not just what the company has done for them, but what the relationship can do for them in the future.

While the implications of emotional and consumptive value might seem most obvious in the business-to-consumer sector, Todor argues that the strategies are equally powerful in a business-to-business context.

Addicted Customers is available now as a printable eBook at (www.AddictedCustomers.com/ebook). The printed version will hit Amazon.com and other book purveyors on October 30th.

John I. Todor, Ph.D., is the Managing Partner of The Whetstone Edge, LLC, a customer experience consulting and training firm that applies scholarly research on human behavior to buyer-seller dynamics including customer loyalty, trust, retention, customer service, CRM and marketing strategy.

Chep, a vendor of pallet and container pooling products, has opened a new Customer Care Center at its headquarters in Orlando, Florida.

The facility, covering 2,500 square feet on the building's first floor, serves as the main contact point for most customer inquiries.

Each week 23 full time employees in the Customer Care Center receive an average of 9,010 contacts, 68 percent by telephone, the balance by e- mail or fax. Coordinators are trained to handle a variety of calls, from placing and changing orders to invoicing. All relevant information is accessible and recorded on Chep's CRM system,or can easily be retrieved from other systems as needed.

"The Customer Care Center is now answering 99 percent of all incoming calls, 93 percent within 30 seconds. More importantly for our customers, the average resolution time is now 1.36 days, an improvement of 3.38 days compared with last year," said Brian Malloy, Senior Vice President Sales, National Accounts and Customer Service.

Consolidation is the driving idea behind the move: Before the Customer Care Center was started in 2003, there were several contact points for customers calling for assistance, Chep officials say. Depending on the question, service could be provided by the Asset Recovery, Customer Implementation, Logistics, Tracking and Tracing, Transaction Management, Information Systems or Account Management departments.

Different information systems and software applications were used to find answers, and many of these calls ended in a voice mailbox.

"We've eliminated dozens of different toll-free numbers coming into the Orlando office in favor of a one- stop shop for resolving common issues like proof of delivery, stock inquires, invoicing, order placement, booking of returns or answering general questions," said Skip Miller, Vice President of Customer Service. "We've also developed 37 different standard operating procedures and updated others to assure consistency in service."

Following up on our live, ongoing CRM case study with Orbitz, I must say, unfortunately, it's not going well for Orbitz. Not only have they continued to refuse to provide the airline seats confirmation service they accepted three thousand of my family's dollars to perform, they've refused to answer any of our e-mailed questions why not. And that is the real CRM problem here.

As I said in the original case study, it's not that they've failed to give us confirmed seats when we paid for them, mistakes happen, we accept that and since we're not flying until November it's not like we have to have them immediately. What's disconcerting is the fact that they refuse to provide even rudimentary customer service.

They have an e-mail question feature on their site, and promise most questions will be responded to within three hours. We've e-mailed them more than once and, days later, have received no response. Not even an autorespond, which is inexcusable.

There are opportunities, classic CRM theory goes, to win customer loyalty. One is on a first interaction. First impressions and all that. Orbitz failed there by not providing the service they had promised in exchange for the payment they accepted.

The second, more significant opportunity is when there's a problem. Hey we're normal customers, we'd prefer everything happen perfectly the first time but we know the world doesn’t work that way. There will be screw-ups, what's important is how the companies handle those screw-ups. Handle them right and the customer trusts you much more than if there had been no problem in the first place.

And the correct way to handle them is to stay in touch with the customer. Tell them yes we realize there's a problem, here's what we're doing to fix it. Customers want to know that you acknowledge their concern, especially a $3,000+, trans-Atlantic flight concern affecting a family of five. Otherwise the customer begins to suspect the company doesn't give a damn about providing the promised service at all. As we do now.

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