The following was transcribed from a recent interview on The Agile Brand with Greg Kihlström podcast.
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Today we’re going to talk about digital customer service, and how it’s now essential for companies in every industry to embrace it if they haven’t already started doing so.
To help me discuss this topic, I’d like to welcome Ragy Thomas, Founder & CEO, Sprinklr, a provider of enterprise software for customer experience management.
[Greg Kihlström] We’re here to talk about digital customer service and how it’s becoming more and more necessary for businesses today. So as you mentioned, you know, as a platform that works with many global brands like Microsoft, P&G, Samsung and more than 50 percent of the Fortune 100, it seems like you’re definitely the person to talk to about this. So let’s start by talking about customer expectations with customer service. So, first question here, why is it not enough to simply have a single method like phone or e-mail or something like that for customer service anymore?
[Ragy Thomas, Sprinklr] Well, let’s look at our own example as a consumer today. Do you behave and have the same expectations from brands the way we had 15, 20 years ago? I remember being on hold for sometimes hours, you know, you called your telco and you’re just in line. You went and made coffee; you came back, picked it up, you’re still waiting, with beautiful digital music on the background. It’s just not acceptable anymore. My kids aren’t going to do that. And what they do is you put them on hold, 90 percent of them turn around and complain about the brand on some social media channel of their choice, TikTok, Instagram, Twitter. Most of them will go leave a bad review. And so your brand doesn’t get defined by the ads you run; your brand isn’t what you want it to be anymore. It really is a sum of all experiences. So if you don’t step up your service game, I think you are in line to go out of business when your peers and your competitors actually do step it up.
For me, one of the low moments in customer experience was when I knew the hold music so well I hummed it automatically just because I’d heard it so much. I think it was either my cable provider or my bank or something like that. But, anyway, so, as you’re saying, and I completely agree with this, customer experience really is, it’s the sum of everything. It’s not just one thing. It’s not even one interaction. It’s really the sum of all of these things. So, you know, what are the stakes for brands that don’t get this right?
I think you’re in line to go out of business, and it might happen slowly or it might happen very quickly. It just depends on how quickly someone in your industry figures it out. If you don’t have anybody offering great customer service, you could hang around much longer. But let’s take retail as an experience. I think Amazon single-handedly has changed that category and expectations of customers. I don’t think you’ll buy anything from a store and be accepting of it if they don’t take a return or they take five days or 20 days to ship because of our expectations. I think Uber has changed the expectations from the transportation industry. It’s no longer acceptable for you to wait, call 1-800 or your local taxi number and not know when the taxi is showing up. And so, literally, I think Tesla is doing that in the automotive sector. So if you don’t really start planning on changing it, I think it doesn’t matter how big you are, I’d say you’re just biding your time in terms of survival. So I don’t think it’s a question of whether you would; it’s a question of when, you know. And they say that, if you put a frog in boiling water, its reflexes are strong enough for it to jump out, but they say, if you leave it in the water and just slowly heat it, very slowly, the frog dies. And so it’s just really up to leaders to see it with that level of clarity and simplicity.
A lot of the people listening to the show, they work for some of those larger companies, whether they’re in the Fortune 100 or 1,000, you know, generally speaking, they’re at least dipping their toes in the waters of the digital customer service. But it may not be a core part of the business or a core part of the customer service function and things like that. So I want to talk a little bit about the operational part of this, you know, how do we make this work and how do we make it work well? So from your standpoint, how does digital customer service work in conjunction with some of those more, let’s call them, traditional methods of customer service, for those organizations that are maybe a little slower to adopt?
So let’s make it real. If you go with it, the contact center operations, most large companies, mainstream companies who really haven’t made the leap, what you’re likely to find is, you know, about thousands of agents, if not tens of thousands of agents, in the contact center, and you’re going to find a few hundred agents in a far corner using something like Sprinklr to do digital customer service. And if you’re really not mature at all, you’re likely to find maybe a third team with dozens of people manning social media customer service. And each one of those, to me, just signifies a maturity in your evolution. If you are just doing social customer service that’s separate from digital customer service, then you’re kind of in level one. If you’re doing digital and e-mails done by a separate team, live chats done by a different team, then level two, and and when you club those, that’s your next stage of evolution. When you club all three, where you have a unified platform for all channels and skill-based routing and AI-based assignment and a lot of wonderful things that Sprinklr can do for you when we transform your contact center, then I think you are kind of well under way to where you need to be.
With any investment like this, there’s the platform component, but there’s also the people and the process component, which, you know, people generally, as much as they say they may be open to change, they’re generally averse to big changes unless they can really see the value, so to help anticipate some of this, what are some of the biggest internal changes that a business can expect to undergo when they’re making some big investments in digital customer service?
The first and foremost is the mindset. It takes someone a little bit higher up in the hierarchy to be able to look at this objectively. Because right now, and I’m including the newer contact center platform companies, those who claim to be on the cloud, in this list. The current stack of the bigger contact center companies are not aligned with your interests. They have a per agent, per seat pricing. So they’re not incented to break down the number of seats. And if you have managers and people whose jobs depend on managing contact center agents and not customer service, you have mMisaligned incentives all over the place.
And so it takes a CIO; it takes a V.P., it takes a CEO to say, “Look, we’ve got to look at this differently.” The average cost of a live channel, whether it’s phone or email or live chat, is about $8 an interaction, per contact, where if you kind of fundamentally flip it into a sub-service capability with modern things like conversational AI – I’m sure everyone’s talking about ChatGPT – you know, the cost drops to about 10 cents. So it is not a question of compelling economics anymore, because your entire contact center team today is incented around metrics that is one generation old. And if you are measuring time to respond, time to resolve, agent productivity, capacity, all of those things are antiquated metrics.
We believe, and I believe, that we need a brand new philosophy and a different mindset to contact centers, one that is not based on measuring or optimizing per call but one that starts by saying to yourself the best contact center interaction is not having one, you know. The second best is when someone’s searching for a solution, as they always do, and the answer pops up and they can resolve it themselves or go through a guided path. And when you actually do get an inbound outreach, you’re able to resolve it in the first interaction itself and have a great expedience. So we just need a generational mindset shift, which is what Sprinklr and I am advocating.
Yeah, I love that train of thought here because, I mean, it’s definitely the shift from, and maybe an analogue here would be in the H.R. world, you know, the concept of employee experience has really come in focus for a lot of organizations, versus H.R. organizations have been very traditionally compliance-focused. And I think what you’re talking about here, it’s being customer-focused, as opposed to more efficiency metrics and things like that. Does that sound right to you?
One hundred percent. You’ve got to go from brand-centric, channel-centric silo thinking to customer-first and customer-centric thinking.
I’ve certainly seen in my work with organizations and managing change and things, big change takes commitment. It takes a commitment, certainly, from leadership, as well as the teams involved. And it does require changes in thinking. Do you see this as, when done successfully, is this an incremental approach to this, where we’re going to slowly shift our thinking over time, or what’s the best way to have long-term success with making these changes?
I kind of think of it as try, prove, scale, as something you should do. And today, unlike any day in history prior to this year, you do have platforms that can be enabling this change, and the answer is not going to be found in a traditional contact center provider. And I hate to say it, but it’s not, even if they all claim to be on Cloud. They’re fundamentally flawed for three reasons, A, because they’re all primarily voice-centric, and they might claim that they support other channels, but they’re maybe multi-channel but not truly omni-channel, where the consumer can switch contexts. The second thing is they’re fundamentally not AI- driven. They might claim they have an AI feature, but they’re not built using AI. And lastly, they are not a part of a unified stack. Your contact center investment should be your front digital gate where consumers are coming in. It makes no sense to turn them away and try to go find them through marketing channels and sales channels, the same exact customer. Who buys an iPhone 14? The guy who has an iPhone 10. Who’s calling your contact center? The guy who has an iPhone 10.
And so our CCaaS approach, which we added voice about a year ago, and our approach is that, but you shouldn’t take anybody’s word, including ours, for it. Start with social and digital. Prove like many of our customers have seen, you know, 40 percent improved efficiency. So you can actually go check the box that your boss wants to, in terms of improving efficiency, while improving NPS, while converting the contact center from an expanse to potentially a revenue center. Go prove it, like you may have seen the press release we’re rolling out Sprinklr for Qatar, the government of Qatar, where 40 ministries are rolling out Sprinklr, so you can just literally initiate any government services, not just complaints, including complaints, on any channel, and we start ticking the clock with an SLA and a command center and connect on the back end to every ministry and provide those services.
But that’s a future. You don’t need to go there in one shot. Try it out in social or digital; then when you know that this works, you know, your AI-based routing is getting your 25 percent more efficiently 15,000 contacts, and the deployment we just did proved to them themselves and the CEO, then go scale it out to your voice-based primary contact center; bring them together. So it’s not just customers, Greg. It’s employees, too. There’s a large bank with 70 million customers that we just redid the contact center replacement for. Those employees were just, literally they had a party to celebrate onboarding us because they’re like, “We’re not going from one screen to the other. We’re not doing the swivel chair dance anymore.” And so it’s got implications on employee retention and hiring, too.
We talked about a few different ways of measuring, and I like what you’re saying here as far as, you know, you’re not going to convince leaders that have been looking at a dashboard or a set of metrics for years and years, and you’re not going to convince them to all of a sudden not use those metrics as any measure of success. But, over time, they will see the value in these things. What should they be looking for, though? And I know you touched on this a little bit earlier, but what are the right metrics that they should be ultimately looking for when measuring this?
I would say the next-generation metric should be, number one, total cost of customer service, total cost. Are the tickets coming down? Are the calls coming down? Number two Is how quickly are you innovating your product and services, using the insights that you get from your contact center? Number three, what is the brand value that you’re able to create by providing exceptional customer service and turning those customers into advocates, instead of detractors? And, number four, how much can you actually sell, right from when people contact you? And we’ve got great stories. We have one of the largest telcos in America. You know, they actually, literally, when a customer says, “Oh, my God, I can’t believe, I’m so happy you resolved this for me so quickly,” or “You gave me credit for this thing that I thought you would never do,” they put them into a marketing workflow and track how many people they talk to, and they compute that media value. I know, in our own experience, in the last two, three years, my cost to serve customers is going down, in spite of our business, you can see as a public company, going through substantial growth. That’s because my own listening research solution is running on everything outside in and contact center data and constantly identifying the top issues that customers are having and feeding that to product and making those issues go away.
About the Guest
Ragy Thomas is the Founder, Chairman and CEO of Sprinklr (NYSE:CXM), the unified platform for all customer-facing functions. Since founding the company in 2009, Ragy has been on a mission to create the world’s most loved software company, recently leading Sprinklr into its next chapter as a public company in June 2021.
A technology visionary, entrepreneur, and investor, Ragy has played an instrumental role in the evolution of two business-critical channels for the enterprise: social media and email. Prior to founding Sprinklr, Ragy was the President of Epsilon’s (NYSE:ADS) Interactive Services from 2006 to 2008, and the CTO of Bigfoot Interactive, an email marketing leader that Epsilon acquired in 2005.
Ragy earned his M.B.A. in Finance and Information Systems from New York University’s Leonard N. Stern School of Business and his Computer Science Engineering degree from Pondicherry University in India.
About the Host, Greg Kihlström
Greg Kihlstrom is a best selling author, speaker, and entrepreneur and host of The Agile Brand podcast. He has worked with some of the world’s leading organizations on customer experience, employee experience, and digital transformation initiatives, both before and after selling his award-winning digital experience agency, Carousel30, in 2017. Currently, he is Principal and Chief Strategist at GK5A. He has worked with some of the world’s top brands, including AOL, Choice Hotels, Coca-Cola, Dell, FedEx, GEICO, Marriott, MTV, Starbucks, Toyota and VMware. He currently serves on the University of Richmond’s Customer Experience Advisory Board, was the founding Chair of the American Advertising Federation’s National Innovation Committee, and served on the Virginia Tech Pamplin College of Business Marketing Mentorship Advisory Board. Greg is Lean Six Sigma Black Belt certified, and holds a certification in Business Agility from ICP-BAF.
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The Agile Brand Blog – Greg Kihlström Customer Experience & Digital Transformation
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