When “poor competitor customer service” is the reason for 27 percent of new customer acquisitions, you need to be sure your company is on the right side of the equation.
Customer Relationship Management. Today, for most, those three words bring to mind the software that coordinates account information, billing, service, deliveries … all the bits and pieces that used to be kept on account cards and in the filing-cabinet minds of long-term employees.
Those long-term employees were often the best “CRM” the company could ever imagine. More than pleasant voices on the phone; they recognized the customer by name, could recall recent issues before pulling the account card, and remembered children and pets by name. Today’s most successful fuel retailers can point to members of their own staff who are still their best customer relationship management resource.
This personal connection often was – and still is – the difference between a problem customer and a happy one, and the difference between a multi-generational account and a lost property. One needs to look no further than the latest Energy Industry Survey released by Gray, Gray & Gray (see page 24).
According to the survey, the reasons delivered fuel retailers lost customers were:
• Competitor with lower prices: 31%
• Competitor with similar pricing: 11%
• Gas conversion: 7%
• Electric heat pump conversion: 19%
• Customer moving away or passing away: 25%
• Customer service issues: 2%
• Other reasons: 4%
Further, compare the reasons companies gave for gains in customer accounts. While very few companies believe they lost customers due to customer service issues, “Poor competitor customer service” is cited as the reason for 27 percent of new customer acquisitions!
Lower pricing: 4%
Competitive marketing/increased sales efforts: 25%
Customer referral: 21%
Poor competitor customer service: 27%
Acquisition: 7%
Diversifications into new products or services: 8%
Fuel conversions from another energy source: 5%
Expansion into new service areas: 1%
Other reasons: 2%
Another interesting point in the “new customer acquisition” responses: 21 percent of new accounts appear to be coming via customer referrals.
The Meaning Behind the Numbers
What do these results mean to a fuel retailer? Customer service matters.
For arguments’ sake, we will assign the “lost to a competitor with similar pricing” group to a customer service issue. Admittedly, the people employed by fuel companies are all outstanding professionals. But a dissatisfaction rating at only 2 percent seems unrealistic – possibly the fault of inaccurate information. However, the “similar pricing” loss leads one to think that those 11 percent of accounts were dissatisfied with something at the company. If it was not price, then it was service!
Therefore, 13 percent of lost accounts are related to a customer service issue, and 27 percent of new customers were due to a competitor’s poor customer service. Another 21 percent of new customers were from current account holders referring the new company … which means they were happy with their customer service and “told a friend.” Could those friends have been looking to leave their current provider because of poor customer service?
These results are not unique to the delivered fuel industry.
In fact, according to recent studies:
- 80 percent of consumers would rather do business with a competitor after one bad experience
- Only 20 percent of consumers will forgive a bad experience at a company whose customer service they rate as “very poor”
- 65 percent of customers have changed to a different brand because of a bad experience
- It takes 12 positive experiences to make up for one negative experience
If your company has been losing more customers than it gains, it may be time to look at your customer interactions throughout your operations.
Who Are Your Customer Service Reps?
We often talk about customer service representatives (CSRs) as the people in the office who answer the phones. These are the individuals with whom customers have the most interactions. They are the voice of the company. Businesses need to pay attention to those voices.
Because of their direct contact with customers, it should be mandatory for all company CSRs to participate in at least one training program or refresher session per year. These programs go beyond telling the CSR to smile when answering the phone to reviewing the importance of understanding the company’s policies and promotions, providing tools to defuse an angry customer, and working through common issues to help the CSR determine each customer’s ideal solution.
And if you stop with these CSRs, you will fall behind.
Anyone who interacts with customers should be considered a “Customer Service Representative.” Every employee represents your company, and serves the customer. That includes drivers and technicians, service managers, dispatchers, accounts receivable and collection staff, sales personnel, and – yes – owners.
Think of how these situations reflect on a business:
- A driver speeds through the streets, cutting off other drivers or running through lights and stop signs.
- A technician leaves a large mess for the homeowner to clean after a service call.
- A salesperson low-balls an estimate, knowing that the actual project will come in much higher.
- A service manager rudely responds to a customer’s concerns about a recent visit.
- An owner runs into a long-term customer at a community event, and does not acknowledge them in any way, even when re-introduced as such.
These actions have ripples that go much further than the one customer. A bad interaction will lead to the customer telling friends, posting on social media – perhaps with video, and leaving bad reviews. If someone puts up a “can you recommend” post to a local community group, the aggrieved customer could easily post about their bad experience, warning people away.
Many industries require regularly scheduled ethical or sensitivity training for every employee, regardless of position, experience, or scope of work. The reasoning: everyone is responsible, and everyone is a representative. This is a mindset that should be ingrained in every company, especially in the consumer-forward delivered fuels industry.
Your 24/7 Customer Relations Representative
Your online customer self-service portal is as much a part of your customer relations management system as your human staff.
In fact, many customers will interact with your portal more often – and more frequently – than they do with your employees. Is your portal friendly? Is it helpful? Does it make the customers’ lives easier? Does it remind the user about other services your company offers? These are legitimate considerations when developing or updating your portal.
Is your portal friendly? The user experience is an important part of any online service. When customers open the portal, the design should be clean and the information displayed clearly. Navigation should be intuitive. The portal should work on all devices – very little will annoy a customer more than having to pinch, zoom, and move the screen around on their smartphone.
Friends keep their friends’ secrets. Customers who call into an office have an expectation of confidentiality around their personal information: name, payment status, bank information, and credit records, to name a few. They should be assured that working on the portal will provide a similar level of security. System security, from firewalls and vulnerability scanners to two-factor authorization, biometric access, PCI compliant payment systems, and more, must be part of the portal setup.
Is it helpful? The majority of customer calls to a fuel retailer’s office are related to account balances, payments, and delivery requests. This information should be front and center on the home screen, so the customer can quickly and easily get the information he or she needs and then take the next step. The fewer steps a customer needs to take to retrieve an answer, the more helpful your portal will be.
Does it make your customers’ lives easier? One could say that this is the main reason to provide a customer portal. The portal should make it easy for the customer to, yes, pay a bill or request a delivery, but so much more. Automated reminders for fall tune-ups, simple re-enrollments for budget or service plans, and personalized price protection renewals, available around the customer’s schedule, are just some of the ways that a self-service portal can make it easier for the customer to work with your company.
Does it remind the user about other services your company offers? It would be a wonderful world if every customer was enrolled in a budget plan with automatic payments, a service plan, and automatic delivery. Even better if the customer used your company not only for heating services, but for their air conditioning, IAQ, electrical, plumbing, pest control, or other service the company provides. Unfortunately, that is rarely the case. Sometimes, the lapse is simply because the customer is unaware that the service is offered! Customers that already know and trust your expertise are the low-hanging fruit for your diversified services. A self-service portal with automated, account-specific marketing messages can put the right promotions in front of the customers who need them. That is not just helpful to your customer; it is good for your bottom line!
Will a company lose accounts because of a portal that is not user friendly? Probably not, all other things being equal. But if the customer becomes annoyed and frustrated every time they need to access their account, it becomes one ongoing dissatisfaction that might tilt the balance if another issue arises.
On the other hand, customer referrals drive 21 percent of new customer acquisition. A friendly, helpful portal could realistically be part of the conversation as another reason to work with the company. And, all other things being equal, that could tilt the balance in your favor.
Richard Rutigliano is President of PriMedia, Inc., an integrated marketing and communications firm specializing in the home energy sector and offering a wide array of SaaS products nationwide. He can be reached at 516-222-2041 or rrutigliano@primediany.com.
