Customers Are Not Identical: Newegg's Customer Service VP Talks Segmentation

Brian Cantor

All customers are not identical.

We remember this reality when developing outbound marketing and sales strategies.  We craft promotional messages based on the specific segment we plan to reach.  We determine sales tactics based on the personalities and seniority levels of the individuals with whom we will be connecting.

Why, then, do we so often forget it when delivering customer support?

Far too many organizations far too frequently provide a standardized, generic form of support.  They react to issues, address problems and offer communication in the same way regardless of the specific type of customer with whom they are engaging.

Newegg is not one of these organizations.  The online technology retailer tailors the entire customer experience journey – including marketing, service and retention strategy – to individual customer segments.

“What I am most proud of is understanding our customers and segments,” said Sue Martin, Newegg’s customer service VP, in a recent interview with CCIQ.  “[Our customer service function] uses the customer segmentation that is normally only used in marketing.”

Key behavioral questions – “Are they a customer who shops seasonally?  Are they a customer who shops every day because they have a small business?  Are they a deal junkie?” – are not simply important when advertising to customers.  They also impact “how we take care of that customer afterward,” noted Martin.

Two customers may have the exact same issue, but if they shop differently, the business needs to handle them differently.

This need for differentiation especially applies when determining which “exceptions” to offer certain customers.  How a customer behaves will determine the value he or she receives from a particular exception.

It, moreover, will determine how much value the business gains from its experience strategy.  The best customer experiences, after all, maximize the lifetime value the business receives from each customer and the total lifetime value the business receives from all customers.  A tailored, segmented strategy is the key to achieving both.

Unity is Essential

In order to properly recognize, understand and tailor to different customer segments, the business must adopt a unified approach to the customer experience.  All departments and employees must have access to the same data and operate in accordance with the same core objectives and missions.  If fractures exist within the organization, they will undermine the experience.  Some part of the experience – be it identifying the customer’s unique traits or delivering an omnichannel engagement experience based on those traits – will not function as needed.

No matter where or why the customer is connecting, the business should be able to immediately determine who the customer is, what the customer wants and how best to meet that demand.

Personalization vs. Efficiency

While few would doubt the theoretical appeal of a personalized, segmented approach to the customer experience, some may dispute the necessity.  Is the value benefit of tailoring the experience greater than the cost savings associated with a simple, stock approach?

This question – one presented as a debate between efficiency and personality – is misguided.  It presumes the business must choose whether to prioritize customer interests or organizational interests.

In reality, no such choice is necessary.

A personalized experience reduces effort for the customer and improves the quality of the experience.  It greatly reduces the likelihood that the customer will need to call back about the same issue (thus reducing costs).  It, meanwhile, greatly increases the likelihood that the customer will buy more – and perhaps even promote the brand to friends – in the future (thus increasing revenue).

These business benefits emerge when the organization takes a customer-centric approach.  What is good for the customer, indeed, is very often what is good for the business.

“The most important thing is to remember that the customers are not going to come back unless they're taken care of,” explained Martin.  “The cost really is in the efficiency of making sure you're taking care of the customer that first time.”

From her perspective, a business-centric experience is not a barebones, generic one that may cost a bit less in the short-term.  It is one that focuses on yielding satisfaction and resolution during the first contact.  That kind of experience generates far more profit in the long-term.

Effective experiences are not even necessarily more costly in the short-term.  The gaps that weaken experiences for the customer also tend to create inefficiencies for the business.  When the business cannot immediately identify the best way to support a specific customer across all touch points, it needs to devote more time, effort and, ultimately, cost to the support process.

A business always cognizant of what is best for each customer is able to most efficiently deliver for each customer.

Empowered Agents Drive Profit

The “efficiency vs. efficacy” debate has particular ramifications for agent performance management. Some businesses feel emphasizing “efficiency” metrics like average handle time is the only way to ensure agents perform as productively as possible.

In reality, encouraging agents to do right by the customer – and finding talent that can understand and act on that imperative – is the more valuable approach.

An agent that values customer satisfaction will not drag feet: he or she knows that a slow, inefficient experience is thoroughly unsatisfying for customers.

The agent will, however, commit to getting the interaction right the first time.  More issues will be resolved on the first contact, more satisfaction will be generated, and more business success will be achieved.

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