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Why Empathy And Personalization Will Be Your Greatest KPIs

A CCW Digital Analysis

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Matt Wujciak
07/17/2020

How empathy and personalization depend on technology

With the explosion of the global coronavirus pandemic, along with escalated societal tensions, empathy has embedded itself in the public discourse of everyday life, and business. When it comes to business, the term has emerged as arguably one of the greatest customer experience, customer service, and marketing buzzwords today - one that sounds simple on the surface, but is far more technical than one might think. 

To personalize interactions between brands and consumers and emphasize with them requires technology. Why? When a customer interacts with your brand online, over the phone, or even in person, the idea is to gain actionable consumer insights to predict customer experiences and consumer behavior in the future - things like seeing who is calling, their history, and potential reasons for the call (qualify for an upgrade, delayed shipment, etc.).  

When we automate certain tasks through advanced technology, we give customer-facing-employees everything they need to focus on human elements like personalization and empathy - time (saved by automation) - and knowledge (gained from consumer insights). To personalize interactions and emphasize with customers is extremely difficult when customer-facing-employees are scrambling through customer files, outdated procedures, legacy technologies, or any other necessity that is also a distraction. 

Read More: Special Report Series: Building Better Caller Experiences

CCW Digital research confirms that brands that embrace personalization along with empathy (aiming to humanize the customer experience), outperform competitors, arguably more than ever before. Humanizing the customer experience can be difficult for many departments “doing more with less,” as operational budgets continue to dwindle (often times in the form of layoffs and furloughs), not seeing customers face-to-face, and of course, working remotely or in isolation. 

The benefits of empathy in the new norm

However, making remote work a more permanent option (for at least some workers) is viable for 73.27% of CX leaders, according to our latest Market Study. This can make emphasizing the human element in the customer experience extremely difficult, but we believe the reality can be quite the contrary. 

CCW Digital research suggests that 90% of CX, marketing, and customer service leaders are more committed to improving AI and digital technologies. Only 2% of respondents said that they are less committed to AI and digital engagement. 

Read More: Special Report Series: Retail Customer Experience Trends

The exponential growth of customer experience technologies, resulting from the remote era (or evolution of customer experience) should be used not only to build more efficient interactions between a brand and consumer, but more actionable data, so we can know our customers and build personalized experiences. When we are more efficient in automated steps of an inquiry or interaction (i.e. checking a customers balance), and have more actionable data (i.e. recommending applying for rewards incentive), we give our employees the resources they need to personally connect and build relationships with customers. 

“Increased focus on human factors (like empathy) during interactions and training” has been a strategic priority for roughly 50% of CX leaders during the pandemic, according to our research. This number is and should continue to grow as consumers continue to grow more sensitive to marketing tone or language, have less money to spend on services and products (as a result of the macroeconomic state we’re living in), and support brands that align with their social beliefs (especially younger demographics such as Gen Z consumers - accounting for roughly 40% of buying power). 

And as call volumes and customer inquiries rise as a result of the e-commerce shift, tension in the contact center is inevitable. During this time, where stress levels are at an all-time high, organizations can work to ensure positive CX loyalty on a more personalized basis.

It's critical for management to acknowledge these trends and give agents the technology and flexibility they need to succeed. For example, extended average handle time may simply indicate the person on the other end wanted to keep the conversation going instead of an agent's inability to address the situation, as you’ll see in Zappos’ case. Re-evaluating new KPIs to prioritize data-driven personalization and human-driven empathy over efficiency metrics such as average handle time is the undeniable truth for many customer experience departments successfully navigating the pandemic.  

A significant majority of customers are more than ready for brand humanization. According to Salesforce research, 84% of customers say the experience a company provides is as important as its products and services — up from 80% in 2018, heavily dependent upon the right formulaic approach to personalization and empathy. 

Read More: How To Scale Conversational AI (Sponsored By IBM Watson)

This means that communication, whether it be marketing or customer service is evolving from a classical, one-to-many approach, toward delivering customer experiences that connect, build trust, and guide mutually beneficial outcomes at a targeted audience. After analyzing the right trends in consumer behavior, and matching our digital investments to accommodate these trends through better operational infrastructures, we can focus on where our revenue is really coming from, so that we can tailor our approach to deliver more individualized and ROI-driven experiences at the right customers

The 80/20 prinicple

The 80/20 rule, also known as the Pareto Principle, is attributed to the Italian economist, Vilfredo Pareto. In one of his papers, Pareto noted that about 80% of the land in Italy belonged to approximately 20% of the country’s total population. In essence, the Pareto Principle infers that there’s an 80-to-20 relationship between effects and their causes.

The Pareto Principle transcends disciplines. In sports, for example, you’ll find that at least 20% of athletes win 80% of the time, or that roughly 20% of training and exercise impact 80% of an athlete’s performance. Similarly, when it comes to healthcare, about 20% of patients depend on as much as 80% of the nation’s healthcare resources.

In the business world, the 80/20 rule suggests that 80% of your company sales and revenue come from 20% of your customers. Alternatively, you could say that 20% of what you do represents 80% of that particular activity’s outcome. 

The 80/20 principle is not a law or a fool-proof algorithm, but rather a concept addressed in most marketing textbooks. However, the concept is this - if we can align our technologies, communications, and efforts at the right target markets (the 20% in Pareto’s case), we can focus our personalization and empathy on the customers that provide the most value to our brand. 

A Zappos approach

We believe that during the pandmeic, when it comes to your business continuity planning, the human connection trumps efficiency in many cases. (Most of us remember the famous Zappos customer service call that lasted 11 hours, a case study that became one of Zappos’ most marketable depictions of the brand’s dedication to their customers). 

While I don’t encourage an average handle time of 11 hours (or any handle time), the reality is personal connection has never been more imperative in customer service than it is today. 

As former customer experience leader at Charles Schwab and bestselling author who has trained over 3,000 customer service agents, Scotty Werner once told me:

“You can start hearing that emotion in there when they’re taking that phone call and instead of reaching that SLA for one minute, they’re on a phone call for an hour because that person might have lost their house and had some challenges. That’s what I look for…”

According to CCW Digital research, we have found that roughly 4 out of 5 are NOT asking customers to refrain from contacting their business with non-urgent requests (78.95%). And there’s a reason for that, as you’ll see in Zappos’ case. 

As Zappos CEO Tony Hsieh said in a keynote at our live event series, Customer Contact Week Vegas:

“Our hope is that 20 years from now, people won’t even realize we started by selling shoes online.” 

Although shoes are the core physical product offering for the Amazon-owned online retailer, Zappos has recently encouraged customers to call the company's service line to discuss many things beyond urgent footwear calls or product related inquiries, whether that's a homework assignment, research question or myriad other subjects — no purchase necessary.

“We noticed there were callers who had concerns and were wanting to talk. We started to see evidence of not just us feeling what was happening in the world, but also that callers wanted to talk about it," Brian Kalma, Zappos employee and entrepreneur told CBS MoneyWatch. Shoe sales may not be booming, but that doesn’t mean the phone’s not ringing, especially when you’re opening the doors (or channels) beyond urgent shoe inquiries. 

If Zappos can provide consumers value in a myriad of other ways, guess which retailer has the advantage of customer relationships (and data) when a consumer does want to purchase a specific style of footwear.

The company's customer service reps are becoming increasingly well-equipped to speak with callers about their concerns while their technologies are becoming increasingly competent through AI and machine learning. "We hired empathetic people, and that allowed us to repurpose our well-trained staff to help people beyond purchasing shoes," Kalma said. 

The concept is a way of giving back while also helping the company gain insight into what customers and non-customers alike want right now - emphasizing with customers, personalizing interactions, learning their target market better, and systemizing their customer service technologies. Their strategy provides actionable consumer data so Zappos can personalize customer experiences while simultaneously delivering empathetic interactions (and reputable brand image). 

"It allows us to uncover new truths and understand what problems people really have and potentially systematize a solution to recurring call problems," Kalma said. 

The approach to personalization and empathy has helped them develop long term relationships, and better develop and systemize their technologies as they are fed more interactions and data through AI and machine learning. As the WSJ recently reported, At Zappos, Algorithms Teach Themselves.

Thriving during disruption

Personalization and empathy breeds customer loyalty. Simultaneously advancing technologies is a plus. 

While I don’t necessarily encourage you to open your customer service channels for non-business related inquiries like Zappos, there is a strategic advantage to building customer-lifetime-value (CLV) through human-driven empathy and data-driven personalization.   

“It costs 700% more to acquire a new customer than it does to keep an existing one,” Scotty Werner told me. 

During a global pandemic, when emotions are running high and behavior is uncertain and often unpredictable, experience is personal. Those who accomplish it, receive dividends. That’s what an experience is after all, an emotionally psychological, mental and physical reaction to a moment or transaction between a brand and a select group of customers, in which they eventually evaluate the experience, choosing to do it again or switch to a competitor. 

The maturity from classical marketing to personalized CX is indeed the right path. Marketers are increasing adoption of and enhancing important digital and emotional touchpoints, while ensuring that they complement each other collectively through consumer data and technology. 

This is a time when the world is vulnerable, where every person and organization is adapting to life with a live virus in their midst, where no one is operating from a best-in-class pandemic playbook. Brands, including marketers and customer service departments must become the very people they’re trying to reach. This means that among innovation, compliance, time and technology, humanity must become the greatest application. 

For media coverage, lead gen, and digital marketing inquiries, contact me at matt.wujciak@customermanagementpractice.com, or connect with me on Linkedin at Matt Wujciak.

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