Customer respect: building a better Web site.

Telecommunications companies are needlessly losing customers (and revenue) by paying too little attention to the factors that add up to "customer respect." By considering a few basic principles, telcos can implement changes on their company's Web site to achieve significant revenue gain. To better understand what's at stake, let's put customer respect into context for your business. Studies indicate that more than 10% of all transactions start with an Internet Web site visit, either to gather information for an offline purchase or to make a purchase online. Additionally, 20% of the average company's customers and prospects abandon a site visit due to an unsatisfactory experience.

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However, if a company can recapture that 20%, it could increase its site visitors, and potential sales, by 25%. Of course every industry is impacted differently, but for a medium-sized telecommunications company, that could translate into about $10 million annually.

The question then becomes, how do you counteract the tendency of so many customers and prospects to simply abandon their visit to your Web site? A recent study by The Customer Respect Group of 500 randomly selected Internet users found that, on average, people abandon 20% of all the Web sites they visit because they have an unsatisfactory experience. Respondents said they left Web sites for a variety of reasons, including:

* information was too hard to find

* poor attention to privacy concerns

* unclear online business practices

* lack of timely response to online inquiries

* poor site performance

* being asked to enter too much data to Web site

There are a number of best practices companies can implement to mitigate the loss of online users to their competitor. First in line: protect your customer's privacy and personal data.

Respect Customer Privacy

Many companies still treat the Web as a necessary evil and online users as second-class citizens--and it shows. Based on the visibility that privacy issues have had over the past two years, one might think that companies would "get with the program" and treat online customers the same way good companies treat "traditional" customers. Yet, in our studies, more than 10% of the top 100 U.S. companies don't even post a privacy policy on their Web site (see chart above).

The treatment of personal data is a key element of customer respect. How can a customer trust a company, if it is not honest and upfront about how personal information might be used? Even if a company does not collect any personal data on its Web site, it is just good business to tell the customer about it.

How do you tell if you are being respectful on your site? Review your site for the following attributes of customer respect:

RESPECTFUL                 DISRESPECTFUL

The privacy policy is      The privacy policy is hard
easily accessible from     to find or does not exist.
the homepage.
The policy is written in   The policy is hard to read
plain language, with       and obviously written by
clear terminology.         lawyers.
Usage of personal data is  Usage of personal data is
clear, and information is  not clear, or is sold or
used only by the company,  shared without consent.
or as directed by the
customer.
Cookies, used to improve   Cookies are used, but are
the customer's             not explained, or the
experience, are clearly    customer is not informed,
explained and include      or is misled.
disable guidelines.
The site collects only     The site collects copious
small amounts of relevant  amounts of irrelevant
data to enhance customer   data.
experience.
Opt-in policy is clearly   The policy is unclear or
adopted.                   no opt-out option is
                           available online.

To let your customers know how you protect their privacy and personal data, take action to ensure you:

* provide clear access to your privacy policy on every page of your Web site

* make your privacy policy easy to read and understand

* fully explain your use of personal data, and use it only as directed by the customer on an opt-in basis

* inform users of any tracking activity on the site and how they can control the use of cookies

Improve Your (Site's) Attitude

Attitude is all about customer focus and how a customer feels about the company after having visited its site. Think of attitude as the general "body language" of your Web site. While many companies are improving the attitude of their site by providing e-mail forms that ask for the information needed to fully respond to a visitor's inquiries, rather than simply providing an e-mail address, nearly one-fourth of the sites studied don't provide an online means for visitors to make inquiries to the company (see chart, page 26).

Customers assess your company's attitude by the overall tone of communication and whether they feel you care about making it easy for them to interact with your company online. But how do you assess the attitude of your site? Review your site for the following attributes:

RESPECTFUL                 DISRESPECTFUL

Site content is well laid  There is too much
out and easy to scan.      information, all of it
                           arranged like an offline
                           brochure.
Basic information is       The site requires excessive,
requested to register for  irrelevant personal information
the site, and only that    to be entered on
which is necessary to      registration.
fulfill the customer's
request.
The customer receives a    The customer receives
personalized, appropriate  no response or a short,
and helpful response.      curt e-mail.
Contacts section of the    There is no e-mail form or
site provides an online    e-mail link, exacerbated
form, guiding customers    in some cases by no
through the inquiry        contact either.
submission.

Speeding Up Response Rates

Whether online or offline, the speed of response to customer inquiries is indicative of how a company values customer interaction and communication. In the Customer Respect Group's 2003 study of the top 100 U.S. companies, nearly one-third of all companies reported that they did not respond to online inquiries (see chart, page 26).

A company must quickly and thoroughly respond to customer inquiries. A quick acknowledgement, perhaps incorporating auto-responder technology, with a note to set the expectation of response time, is a best-practice imperative. E-mail communication presents a powerful tool in building lasting relationships with customers. And best of all, it is relatively inexpensive, compared to more traditional communication methods.

Review your site for the following attributes to see how responsive your company is to customer inquiries:

RESPECTFUL                DISRESPECTFUL

The site offers clear     There is no information
indication of response    regarding type or timing
commitments.              of response.
There is good use of      There is no informative
screen-based or e-mail-   inquiry.
based auto-responders.
The company follows       Company does not deliver
through on the auto-      on auto-responder
responder commitments.    commitments.
The company gives a       The customer receives no
personalized, relevant    response, or gets a
and helpful response.     dismissive e-mail.
Feedback is solicited on  The company shows no
helpfulness of response.  interest in customer
                          feedback.

Take action to improve your responsiveness to online customers by:

* providing a choice of inquiry methods, including an online inquiry form

* immediately acknowledging an inquiry and setting the response time expectation

* meeting commitments and providing relevant and helpful responses

* asking for customer feedback

Customer Respect Pays

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Another element that should be considered in customer respect is the net industry factor, which combines the direct revenue impact and overall brand impact for an industry, as shown in the above chart. The net industry factor is calculated by multiplying the direct revenue impact factor by the brand impact factor. The telecommunications industry net industry factor is 75% (100% X 75%).

The potential revenue gain for implementing these best practices on a Web site to improve the online experience of customers and prospects is illustrated below for the sample telecom company.

Calculate your company's ROI and payback period using this formula:

SAMPLE TELECOM COMPANY

Company revenue per year                 A  $5,000,000
Net impact percentage                    B          10%
Revenue impacted by your Web site        C    $500,000 (A X B)
Site potential improvement factor        D          25%
Revenue at risk                          E    $125,000 (C X D)
Net industry factor (select from chart)  F          75%
Potential revenue gain per year          G     $93,750 (E X F)

Depending on the quality of your Web site and your customers' complete online experience, you can dramatically increase revenue. Measurement is important. Companies should be on a mission to improve the online experience of their customers and prospects, with the objective of increasing sales and customer retention. By considering a few basic principles, you easily and cost-effectively can implement changes on your Web site that stand to produce a significant return-on-investment and payback period.

Are companies concerned about privacy?

Sites without privacy policy  10%
Sites with privacy policy     90%

How can customers contact a company?

Offline Contact   7%
E-mail address   16%
E-mail form      77%

How quickly do companies respond to online inquiries?

Full response within 72 hours   5%
Full response after 4+ days     5%
No response received           31%
Full response within 48 hours  59%

[c] Copyright The Customer Respect Group

Note: Table made from pie chart.

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To improve the attitude of your site:

* Make your Web site customer-focused.

* Enable intuitive navigation.

* Provide quick access to key information.

* Offer easy-to-use forms.

Roger Fairchild is president of The Customer Respect Group, an international research and consulting firm that uses its Customer Respect Index (CRI[TM]) methodology to help companies improve how they treat their customers online [www.customerrespect.com]. He can be reached at [e-mail].