Tuesday, December 30, 2008

Face to Face is highest Cost-to-serve

Following my recent posts on implementing and managaing customers down to a lower cost-to-serve channel, I got several emails from people asking me about face-to-face communication and where it fitted into my Interaction diagram.



Unsuprisingly, face-to-face (F2F) contact appears at 'Position E' in the top right corner. This channel of customer interaction is the most costly, involving premises or travel and a lot preparation. It may also need the customer service individual / account manager / client contact / handler, etc. having all necessary information and support materials to-hand.

Costs can potentially increase further depending upon the demands of the interaction. For example: you may have a complex product that needs explaining / configuring or possibly a prestige client-base who is used to the "Low Tech / High Touch" approach. Try managing these people to a lower interaction channel and you could instantly see them quickly migrate to your competitors.

2 comments:

Anonymous said...

I think that, main determinant for person or robot on the phone, is not only the complexity of the produt, but the Customer Life Time Value.

If churn is very expensive, you will have person on the phone. Other wise, companies will not care who/what is on the phone. (person or robot)

Hayden Sutherland said...

Ugur
Thanks for your comment. However I disagree that you just have to have a 'high touch & low tech' for high value customers (whether that be calculated on a transaction-by-transaction or CLTV basis).
Surely its down to relevance?
E.g. If the customer is happy to use Internet and other less-costly interaction technologies, they my not let them. However its how you manage them and identify where & when they need further 'hand-holding'.
What do you think?
Hayden