Ventana Research Analyst Perspectives

Companies Struggle to Engage with Customers Digitally

Posted by Richard Snow on Dec 11, 2013 8:45:11 AM

If you stop to compare communication preferences of the past to those of today, you can’t fail to notice some major changes, especially in younger generations. Talking on the phone – fixed or mobile – is in decline, as many people now prefer text messaging, chat and social media. We rely on the Internet to search for websites, run mobile apps and use social media. We watch less TV in real time, preferring to watch what we want, when we want to watch it and to skip advertisements. The same applies to newspapers, with many people preferring to have the news they want to see downloaded to their smart devices. Today, any email from someone we don’t know goes straight to the junk mail folder, and writing seems to be becoming a lost art. This is the world of the digital customer. Companies have to support digital customers while continuing to support others who still make phone calls, send email and even write letters. According to my research into next-generation customer engagement, most companies are not yet prepared to meet the expectations of digital customers.

The first challenge is to support a range of channels of communication. The research shows that as many as 17 channels are now in play, with companies on average supporting approximately seven. However, of the channels currently deployed, the traditional ones are still the most common: the telephone (94%), email (92%) and letters and printed forms (78%). And although social media ranks fifth with 60 percent of companies supporting it, a long way down the list are mobile apps, social media forums, video calls and virtual agents. But simply supporting a greater number of channels is not the real issue. What customers increasingly expect is an omni-experience: consistent, personalized, contextual interaction across all channels. Similarly, the research shows that most companies are a long way from meeting those expectations.

vr_NGCE_Research_12_all_current_channels_for_customer_engagementThe most persistent challenges companies have in supporting multiple channels are lack of integration between channels and with other supporting systems (49%) and channels managed as individual silos (47%). The result is that one-third of companies deliver inconsistent responses. To meet this challenge, the most practical option for businesses is to deploy interaction management in the cloud, where most suppliers have integrated systems that are easy to deploy and fall within the price range of most companies. More companies are taking this option, and more are expecting to deploy mobile business apps (26%), social media forums (23%) and mobile customer self-service apps (23%) rather than other channels. However, both this and previous research find that companies expect growth in all channels and will have to continue supporting both traditional and digital means of interaction.

vr_NGCE_Research_05_who_handles_customer_interactionsThe next challenge relates to organization. Customers generally don’t care with whom they interact or what technology is employed. They want answers, they want them fast, and they want that full experience, hence the increasing importance of first-contact-resolution rates. As I’ve written previously, this is a major issue because most companies are still organized into business units that operate somewhat independently. These units have their own processes, systems and key metrics that relate to their tasks and usually don’t take account of the impact on other business units; one of the classic examples is Marketing launching email campaigns that the contact center knows nothing about. This research shows that there has been little change in this situation, as companies now involve on average four business units in inbound customer interactions. Similar to the case of communication channels, long-established business units still top the list when it comes to interaction handling: contact center (71%), sales (59%) and branch offices (50%). However, further examination shows that just about every part of the organization except IT is involved. Once more the net impact is that interaction-handling processes are ineffective and interactions are not handled in a consistent manner. However, mature companies have come up with an innovative solution that others should consider: They have begun to use collaboration systems as a platform for more cooperation across the enterprise. Such systems allow employees to share information, provide real-time messaging capabilities (typically wall boards) and enable faster, more consistent resolution of customers’ issues. Some vendors are branding this as the “social enterprise,” but companies should think of it more as the collaborative enterprise, as it supports leaving the current organization in place while encouraging more information sharing and collaboration.

Unfortunately, the research shows two more strategic changes needed before more companies can address these challenges. First, the changes that most research participants said would be most likely to improve customer engagement – deploy collaboration, redesign the customer portal and deploy more mobile apps – bear little relation to the top likely actions of companies, which are to find ways to avoid calls reaching the contact center, accommodate agent requirements in scheduling and compare performance across sites. All six of these goals are important, but to become more customer-focused, companies need to align their actions more toward improving the customer experience than operational efficiency. The same holds true when comparing the metrics companies said they want to improve – customer satisfaction, customer retention and number of net new customers – and those currently in use – average handing times, first-call resolution and quality scores. Again, all six are important, but companies need a balanced set of metrics that drive improvement in customer experiences while also taking into account operational targets.

Ultimately, one thing is certain: The digital customer is here, and as each younger generation grows up with smart devices, use of digital channels and self-service will become even more important. Our research shows that only the most mature companies are close to meeting these expectations; others need to put words into action and catch up quickly or risk missing out on key customer segments.


Richard J. Snow

VP & Research Director

Topics: Big Data, Sales Performance, Social Media, Customer Analytics, Customer Experience, Speech Analytics, Operational Performance, Analytics, Business Collaboration, Business Performance, Cloud Computing, Customer & Contact Center, Customer Service, Call Center, Contact Center, Contact Center Analytics, CRM, Text Analytics

Richard Snow

Written by Richard Snow

Richard leads Ventana Research’s Customer and Contact Center Performance Management research practice, which is dedicated to helping organizations improve the efficiency and effectiveness of managing their customers, throughout their lifetime and across all touch points, including the contact center. He conducts research exploring the people, process, information and technology issues behind customer operations management, contact center management, and customer experience management. He also works with senior business operations and IT managers to ensure that companies get the best performance from today’s highly complex application products. Richard has worked in management and consulting leadership positions in the technology industry including with Price Waterhouse, Sema Group and Valors. In his work, he has been involved with all aspects of delivering highly complex IT solutions to a variety of clients in the telecommunications, financial services and public sectors. Richard has specialized in delivering customer care and billing solutions for telecommunications operators, and several multi-channel contact centers for organizations in both the public and private sectors.