Turning the tables on customer care
Customer care--or lack of it--has long been the Achilles heel for wireless operators. It's a costly expense that many operators try to reduce by automating their customer care process to keep the number of "live" customer care calls to a minimum.
Sprint, which is known for its less-than-stellar customer care, tried to reduce its customer care costs earlier this summer by terminating some customer contracts because those customers made "excessive" calls to customer care. While Sprint may have saved some money in customer care, the resulting negative press likely cost the carrier even more.
T-Mobile USA, meanwhile, seems to have a handle on its customer care process. The carrier consistently wins J.D. Power and Associates awards for the positive customer care experience it provides.
T-Mobile's perception as having good customer service is important for a number of reasons. According to Bob Hayes, head of Business Over Broadway, a Seattle-based firm that conducts customer satisfaction and loyalty surveys, customers that are satisfied with their customer service representative's knowledge of the company's products and services are more likely to purchase more products from their provider. In fact, a recent wireless carrier study by Business over Broadway found that 61 percent of those satisfied with their carrier customer service representatives said they were more likely to purchase more services/products from their carrier. That's compared to 47 percent who are not satisfied with their carrier's customer service representatives. "Customer service agents have a significant impact on cross-selling," Hayes says.
He also notes that most wireless carriers only measure one type of customer loyalty--advocacy loyalty--which is whether or not customers will recommend the operators' products and services to their friends. Business Over Broadway found that 70 percent of those surveyed said they recommended their current wireless service providers to at least one friend or colleague within the past 12 months. But 27 percent said they will switch to another wireless provider within the next 12 months.
Hayes believes that if carriers would spend more time measuring purchasing loyalty--the likelihood that customers will purchase different products or increase the amount of products they buy from a company--they would be able to increase their revenues from their existing customers. "Carriers should spend more time finding out who their customers are and why they stay with them," Hayes says. "Don't measure who leaves you. Find out how existing customers will buy more from you."
I think Hayes offers some good advice to operators. With so much emphasis on how data services can increase ARPU, carriers are losing touch with the basics. Good customer care goes a long way toward building loyalty and making people want to spend more money with you. -Sue
P.S. In recognition of Labor Day, FierceWireless will not be publishing on Monday. Enjoy the holiday weekend!