It's something every company has dealt with: a customer calls your contact center saying he wants to cancel his service. To him, it's a simple request. Talk to someone, they'll update some information, and it's done. To a company, it's do-or-die time. No one wants to lose a customer, so it's time to put on the charm, break out the retention strategies handbook, and stay calm, even when your hair is on fire. What can be offered to keep the customer? A year's worth of a premium option? Additional loyalty program perks? The guarantee to keep prices the same for the next two years? It can get pretty outrageous pretty quickly.
Even with the offer of those amazing promises and perks, the situation can go a few ways. The customer could insist on canceling, end of story. The customer could be convinced to stay with discounts and additional services offered (but will make a note on his calendar to call back and cancel when the discounts expire). The customer could become frustrated with the retention efforts and ask to escalate to a manager to resolve the issue, which doesn't bode well for the relationship. The customer could hang up and try his luck again later, which means he will be at DEFCON 3 right out of the gate. Or the customer could immediately take to social media and spread the word that your company is unable to handle even a simple request like canceling an account.
Risky Customers Abound
No company wants to have risky customers—otherwise known as customers at risk of canceling service or never returning to your store—but every company, no matter how beloved, will be faced with risky customers. It's nearly impossible to satisfy every customer all the time. Even the stalwarts of customer service, like Apple and Amazon, sometimes have unsatisfied customers. And the truth is that not every customer relationship can be saved, despite extensive retention efforts. But there is a way to avoid handling risky customers: don't let them get to the point of becoming a flight risk.
That's not easy, you might say. You're right. That will take a lot of time and effort, you say. You're right. And let me tell you, all that time, hard work, and effort is worth it. You won't have customers blowing up your image on social media. You won't be dealing with upset phone calls. You will have smooth sailing with happy customers who sing your praises whenever and wherever they can.
What's the magic formula? You mitigate customer risk. And you do that by implementing a solid risk recovery model that is continuously improved based on new data, gathered through your customer lifecycle management program, and act on that customer intelligence to mitigate customer risk. In a nutshell, a high-risk customer predictive model and white-glove service recovery.
Predict and Resolve
Let me give you an example. A security company was experiencing higher levels of customer dissatisfaction, leading to cancelations. The company wanted to dig in and figure out why so it could improve its products, processes, systems, or whatever needed to be improved. The company engaged a proven big data business partner to help design and develop a model that would identify those customers who were at a higher risk of canceling. More than 200 customer attributes were analyzed to identify the top areas influencing cancellations. Some of the most important included customer intent, customer profile, call activity, and customer sentiment. Some attributes, like demographics, couldn't be changed. Other attributes, like dissatisfaction or reaching the end of the contract term, were things the company could change.
The number one, most important change the company made was to route high-risk customers to specialized security advisors who were trained and best equipped to resolve the issue and recover the risk. This was made possible by implementing an IVR with proactive call routing based on customer segment—with high-risk customer defined as a segment. Based on A/B testing with control and variation, the company was able to prove a 20-point improvement in Net Promoter Score when a high-risk customer was routed to the specialized team versus dealing with the normal security advisor representatives. The company also made outbound email and phone call efforts with high-risk customers to extend special offers and encourage contract renewal. The results were impressive: the number of customer renewals doubled in the first six months of the program.
There were some crucial elements for success in that company's revamped risk management and intervention solution. One was the willingness to dive in and figure out how to improve. Another was the cross-department partnerships that facilitated success. The marketing department developed effective customer communications. The contact center embraced changes and improvements. The process excellence team worked with everyone involved to ensure the business processes made sense at all levels. Yet another was involvement of the executive team, driving home the importance of customer focus and service. It all combined to create a successful path forward for the risky customer.
Are You Risking Your Risky Customers?
Consider your current risk management process and procedures. Do you have a flexible process in place that allows representatives to find the just right solution to retain the customer? Are proactive efforts part of your toolkit to maintain customer satisfaction? Are you making it complicated for customers to leave, risking negative sentiment shared around the world? Don't increase the risk of already risky customers leaving. The more you can do to predict, mitigate, and be proactive, the more success you will have retaining satisfied customers for years to come.
Jay Autrey is chief customer officer at MONI.