The Heartbreak of Customer Service

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The Multi-Channel Direct Experience

The direct marketing world has had excellent customer service for decades. It isas I stated earlierthe reason that direct marketing has shifted huge amounts of market share from retail and is now making double-digit, online gains during the holidays, year-on-year. These customers come from somewhere, and that somewhere is shopping malls. Run out the computer simulation. The gains in online satisfaction relative to the defections from bricks and mortar would indicate that shopping malls will be in real trouble in about five years, maybe sooner.

A great part of this shift is coming from a growing consumer backlash against non-existent customer service. And here is the interesting thing: there may not actually be any more customer service online, but the algorithms make it seem like there is more service, provided you dont need anything out of the ordinary. A large part of my anecdotal collection of evidence is hundreds of conversations where people comment on how much easier and less frustrating it is to shop online compared to putting up with the rudeness and hassles of the retail stores. And this shift is palpable as a very real trend. You see the evidence in less gift wrap and ribbons being bought as more and more packages are sent to recipients via UPS, FedEx and USPS. You see few cars piled high with presents in the back seat as they drive to Grandmas house. The presents were already delivered to Grandmas door, and Uncle Justins, and Aunt Kims.

If the algorithms dont meet the consumers needs for customer service, there is usually a proficient inbound staff or live chat staff to handle the customers wishes. Unlike retailers, direct marketers have perfected the entire fulfillment process, going well beyond the cashier function. Lands End, in its pre-Sears, innovative, halcyon days, pioneered live chat and personal shoppers. The result: dominant market share and incredible customer loyalty and retention. Compare that to the customer record of Sears or K-Mart retail stores which is bleak and seemingly getting bleaker. Direct marketers value customer service. We view it as being much more than just a cost-center.

But, there are cracks appearing. So many multi-channel direct marketers today come without the fifty years or more of catalog and extraordinary customer service heritage. Many of these new online, multiple channel merchants come from retail, and they have as little regard for the customer as they did for those irritating people who disturbed them by walking into their stores and asking to purchase something. Many New Merchants want to impose the same customer non-service learned psychology of the Skinner-Box response on the online marketplace just like they learned in the retail marketplace. And they will destroy direct marketing. We are at a bifurcation in commercial history. One direction is near-total direct commerce. The other is overbuilt and risk-laden bricks and mortar retail. And I would state that there is little success in a third direction: peaceful co-existence. The market abhors compromise. The market wants a winner.

We multi-channel direct marketers are poised to deliver the coup de grace to big-box retail. If ever there was a time for a total, all-out commitment to arming ourselves with the most powerful of all weaponsextraordinary customer serviceits right now while we are making incredible gains in online and catalog market share. Why?

1. We know how to deliver world-class customer service.
2. We have the systems to obtain the necessary information to deliver world-class customer service.
3. We have the cost-structure to opt for world-class customer service over bricks and mortar.
4. We have the fulfillment processes and systems in place to deliver world-class customer service.
5. We have the overall margins allowing us to deliver world-class customer service.
6. We have market share scalability because we recognize the inevitable intellectual consumer backlash demanding world class customer service that is coming.
7. We have a long heritage of caring for and about our customers.

Provocative? Yes. Divisive? Absolutely. Radical? You bet. We are, however, engaged in a never-ending, global war of economic dominance. That war, and the individual battles fought on the website plains, in the foothills of the Internet and across the rivers of catalogs, will determine what form of marketing dominates and continues and who owns the future. Were I asked to ride a powerful war horse into battle, I would choose as my mount Customer Service.

Copyright 2006 by Donald R. Libey. All rights reserved. May not be reproduced by any means without permission of the author. Contact Libey LLC; www.libey.com or call 877-903-9448.

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