Stand and Deliver

Multiple-channel CRM strategies can provide better service, customer retention, and profitability

By Hisham Alam

The race to attract and retain customers is fiercely competitive. To stay in the game, you need multiple channels to attract and conveniently service customers. The new competitive advantage for all service-oriented companies goes beyond providing simple customer convenience. Instead, your company must actively engage your customers in a mutually beneficial relationship and manage it through multiple channels in a seamlessly integrated way. Seamless integration of the channels lets your customers begin a transaction through one channel and then complete it through another according to their preferences. The result? More business with the same customers and increased satisfaction and retention - all of which leads to greater profitability.

The arrival of the Internet and sophisticated call-center technologies has spurred the recent rise of the delivery service business. This competitive business uses multiple-channel CRM strategies to an intense degree. The Holy Grail of the business is the quest of the last mile (delivery from the last point of distribution to the home). Your goal is to create a high quality infrastructure that will act as an intermediary between the consumer and the retailer. The consumer benefits from convenient local delivery. The retailer benefits from the economies of scale of a large consumer base extending beyond its immediate boundaries.

Egg and Entree Delivery

Startup grocery delivery and restaurant food delivery companies lead the way in multichannel CRM. These companies take your order and deliver it within the hour or at a scheduled time. Grocery delivery businesses tend to operate their own warehouses and delivery fleets at the major metropolitan locations. Food delivery companies, on the other hand, will partner with food outlets and restaurants while owning or subcontracting delivery fleets at major metropolitan locations. Both businesses save money by operating consolidated call centers, data centers, and Web sites.

For these companies, the initial intent may be to deliver one type of item, such as restaurant food. However, once they have established an infrastructure, they will have the option to expand their services to the delivery of other items such as flowers, office supplies, books, and so on. A successful expansion depends on their customer reach, the quality of their service infrastructure, and the brand recognition they receive.

The key performance criteria of these businesses are high quality customer service and low cost. The profit margins are slim in these competitive businesses and may come from any combination of nominal delivery fees charged to customers, sales commissions for the items sold, or price markups on discounted purchases from retail partners. The profits are generated from repeat business, high volume, and economies of scale.

As with other businesses, 20 percent of the customer base provides 80 percent of the profits. Profitability is directly affected by the ability to retain customers and provide the best service to the highest paying customers. Implementing a CRM solution can help you achieve these goals.

The types of CRM solutions most critical to the delivery service business are call centers and personalized Web sites. They form the front-end operations of the business and must be tightly integrated with the back-end service fulfillment operations.

Front-End Operations

The delivery service business provides a number of intermediary functions. Front-end functions initiated during customer interaction include:

Take customer orders. Customers refer to a catalog of items to make selections and place orders.

Track order status. Customers are provided with the status of the orders placed and the latest estimates on delivery times.

Change order. If possible, the customer is allowed to change, or even cancel, the original order that was placed (may be subject to a change fee or a penalty).

Accept payment. The process of accepting and routing credit card payment authorization, or in the case of corporate customers, routing account validation.

Transaction correction. This process remedies an improperly executed order transaction.

Record customer complaint. This feature provides a means for the customer to express dissatisfaction with the service performed or item delivered.

Call Center Convenience

A call center naturally lends itself to providing these front-end functions. For example, in the restaurant food delivery service, the call center is the main interface between your customer and the business. People find it convenient to pick up a phone and order food. Furthermore, your customers may have so many options for the way a meal is prepared (for example, a steak may be "well done," "medium," "rare," and may be accompanied by a variety of side orders, and so forth) that it is often more convenient for them to order by phone.

The call center can enhance the customer experience in many ways. Through the call center, the customer has access to a live customer service representative (CSR) - the preferred mode of interaction for many people. By looking up a customer's preferences and profile and then routing the call to the most suitable CSR, you can achieve higher customer satisfaction. Interactive voice response (IVR) capability gives the customers greater control and lets them navigate to an appropriate CSR or perform an automated transaction from an easily accessible phone anywhere. Finally, access to a live CSR lets the customer request immediate redress for an improperly executed order.

Reduced call waiting time, fewer repeat calls for the same transaction, and rapid call closure are key performance measurement criteria for monitoring and improving call center effectiveness.