Building a Customer Service Strategy for the Subscription Economy

We've reached a turning point in the digital, internet-driven world. The way we purchase and receive service is changing, and it is forcing companies to rethink their customer service strategies. Businesses no longer sell products; they sell experiences. Le Tote is a great example. With its online "fashion rental" service, customers shop online and big boxes of apparel appear at their doorsteps. They wear the clothing as long as they like, either returning all of it for a rental fee or purchasing pieces they want.

In this subscription economy model, customer service is promoted from complaint resolution to actually delivering the service itself. The job becomes about increasing intimacy with customers and monetizing long-term relationships. Customers expect convenient, flexible, and personalized products and services delivered through cohesive customer experiences. Building the next generation of customer service is going to take a true shift in how companies engage customers, deliver service, and proactively optimize service strategies.

As business models shift, companies should focus on the following three areas to keep pace:

1: Eliminate service inconsistencies and gaps with journey mapping.

Journey mapping is an essential customer service practice where companies determine which journeys are the most important to their customers. The end-to-end experience is dissected from the customer point of view to determine how well the company met customers' needs.

Companies are often surprised by what they find. According to research firm McKinsey & Company, customer satisfaction is often low for the journeys that matter most, typically those that happen after the initial customer request is made. Understanding both the customer journey from beginning to end and the driving forces that impact their experiences, companies can begin the process of reforming their strategies to see things as customers do.

Consider, for example, the journey map of a process with which most of us are familiar, applying for a credit card. We probably don't think about it much, but this process involves more than filling out a form online. It involves a complex series of interwoven processes with multiple inputs and actors, surrounded by a customer expectation that the process should be fast, fluid, and easy. A journey map considers the steps involved, including when the customer requests a credit card through online service; the approval process, including credit checks and identity verification; various stages of customer input; communication to the card provider; configuring, packaging and shipping the card; and customer receipt and activation, all before the first dollar is spent. Within these various touchpoints, companies can focus on how each activity might impact customer satisfaction and focus on the key activities and processes in the journey.

2: Connect operations to support digital experiences.

Tech-savvy consumers have been trained to expect fast, easy, and effective service. Companies have focused on addressing the front end of the customer experience and continue to refine that experience using new technology, like self-service and artificial intelligence. The gaps exist after the customer makes the initial request. This is where many companies piece together manual processes with email, phone calls, and spreadsheets. Most people have experienced the customer service call where you are transferred to the next department and the next one after that.

This is where modern technology can help connect all of these siloed activities to deliver a closed-loop service experience for every customer. In "Predictions 2017: In Digital Transformation, the Hard Work of Operational Excellence Begins," Forrester noted that "to become a digital business, you will also need to embrace the digital transformation of back-end processes. As [one large retailer] learned, you may find that you need to spend $4 on digital operational excellence for every $1 you spend on digital customer experiences." Only then will companies be able to execute a shift in customer satisfaction.

3: Automate the mundane to get ahead of customer requests.

Several technologies, including the internet of things (IoT), workflow analytics, and artificial intelligence, are paving the way for a change in service delivery. Many companies are now using IoT to monitor customers' products and services to maintain a real-time status on how service is being delivered or whether products are up and running or need maintenance. From a fridge that sends you notifications when the door is left open to remote monitoring of complex manufacturing equipment, everything is connected.

Using active monitoring and performance analytics, companies can provide proactive customer service, make faster decisions based on real-time data, and analyze information to identify whether action is needed. Machine learning and virtual agents automatically categorize and assign requests to speed the process for customers, but to also remove mundane work from customer service agents. This can lead to greater job satisfaction and the opportunity to shift focus to higher-level work, such as helping customers understand how to get more value out of the products. All of these technologies are part of the opportunity to operationalize service beyond front-end engagement to deliver a more proactive and end-to-end approach to service.

As companies reshape their businesses around the customer journey, they will be in a better place to take advantage of the tremendous opportunities ahead for customer service. While these changes will take time and patience, companies need to remember that in the long run, a connected and proactive customer service program will mean fewer escalations and a simpler customer journey that gets it right the first time.

Holly Simmons is responsible for global product marketing for customer service management at ServiceNow. She has experience in marketing, product development, and professional services for cloud solutions and has held senior leadership roles in global audience and product marketing at SAP for service, IT, sales, marketing, HR, operations, and supply chain. She also brings experience from four startups, her own consulting business, and other established companies, including Apple and Knight Ridder.