While the contact center was once simply a place that tried to help customers on a transaction by transaction basis, today, smart companies consider the contact center a strategic tool in maximizing the value of each customer to the company. It’s a place with a mandate to build an engaged customer that will remain loyal for life, voluntarily helping a company sell by sharing positive experiences with others.
For this reason, more contact centers are paying attention to a metric called customer lifetime value, or CLV. According to Laura Bassett, director of marketing, Customer Experience and Emerging Technologies for Avaya (News - Alert), CLV is about optimizing each interaction and conversation in order to create an engaged customer relationship which drives customer retention, repeat purchases, customer referrals, reduced support costs, and possibly even price premiums. CLV is determined as follows:
Customer Revenue – Support Costs x Average Length of Relationship – Support Costs = CLV
Conventional wisdom tells us that boosting customer lifetime value is the best goal a company can aim for. It also tells us that the contact center is the best possible department to invest in when shooting for the goal of improving CLV.
“The contact center is an important participant throughout the customer journey,” writes Avaya’s Mark De La Vega, VP and general manager of the company’s Contact Center Business Unit. “It is involved from the time a customer researches, selects, and buys a product or service until the customer receives it, begins using it, and requests support. Throughout the journey, the contact center pursues customer experience objectives such as retention, loyalty, and advocacy—and ultimately, customer lifetime value (CLV). This pursuit elevates its role in the business.”
According to De La Vega, the most critical period for “locking in” customer lifetime value is the beginning of the relationship – “onboarding,” he calls it – that happens in the first 90 to 120 days of the beginning of the customer relationship. This means that the future of the customer’s revenue stream lies in the hands of the company’s contact center agents who typically deal with new customers. While all call centers should pursue efficiency in operations, notes De La Varga, customers don’t care much about efficiency: they simply want to receive the best service possible. As a result, cutting corners with new customers can put a business in jeopardy.
“To this end, contact centers must become smarter,” writes De La Vega. “This begins by investing more—and more wisely—in contact center personnel. This may seem counterintuitive in light of the emergence of self-service options. After all, customers are more adept at helping themselves online or through integrated voice response systems. However, when they do require assistance from a live agent, their needs tend to be more complex. This requires highly trained agents with specialized skills.”
This likely involves ensuring that the best possible agent is made available for each customer at the right time. In addition, mining all the available data about the customer and using it in a way that will ensure the customers is best satisfied is also a critical step. Once loyalty is attained, companies can start building brand advocates who will remain loyal to the company for the lifetime of the relationship.
Edited by Blaise McNamee