A previous blog post detailed the issue of transactions problems moving from digital commerce to “analog customer service”. Not only does this reality create problems for the customer, it also raises the cost of doing business substantially for eCommerce companies. Every customer support and operations executive we talk to has a clear idea that the customer support cost of transaction problems is actually substantially more than other, typical transactions. However, many of them don’t know just how substantial.
Now we are fortunate enough to have some real world data on this issue courtesy of a large British eCommerce company. This hard data proves the point that the cost of going analog is substantial and that reducing the cost of problem transactions is critical to running an efficient business.
To start, the proportion of complaints to total support center contacts is 14%. This is a bit higher than many guestimates that are out there. One in seven contacts is a transaction problem that, as we’ll see below, takes more time to manage and costs a great deal more money.
Perhaps the most surprising finding that came from the data sets is the amount of actual time that is spent handling problem transactions. The starting point is the time differential between a “typical” contact – or inquiry – in the support center and a problem transaction. Their data shows that the average handling time for a contact is 5 minutes. However, it is much longer for complaints (what we refer to as transaction problems). The typical transaction problem contact took 20 (although in a small number of cases, up to 90 minutes)! It should also be noted that these cases include standard and escalated labor costs. This clearly creates a real problem. The additional cost associated with the call is £3.50. There is also a software license fee cost associated with each of these calls that costs the organization £0.30.
However, the biggest single cost area is for the compensation that must be given to the customer when a transaction goes bad. The data shows that this cost is £16.60. The impact of hundreds or thousands of transactions per month that have this level of cost will obviously have a large negative impact on the bottom line of the organization. Any way to reduce this cost or even mitigate the compensation must be strongly considered.
When added up, these costs total £20.40. Considering the average cost per contact is just under £.90, the difference at 22x is nothing short of astounding, especially when you consider the average ticket is somewhere around £120. Even if one were to back out the compensation, the cost to handle a complaint is still 400% higher than the average contact. More importantly, these hard costs increase the attractiveness of automated systems that can mitigate transaction problems or offload some of the load on the human teams. From the customer perspective, an automated system for resolving disputed transactions also makes the commerce experience even more effortless as they don’t have to wade through automated call trees, wait on hold, and re-explain the issue with each new call center contact. Ecommerce organizations have to seriously consider deploying a solution that reduces the likelihood that a digital commerce event will go analog and can save substantial costs. Doing so will go a long way toward ensuring an effortless experience.
Some of our customers had a difficult time tracking transaction problems separate from their other contacts. In an upcoming blog post, we’ll show you how one very clever and pragmatic customer care executive solved the problem.