How many customer touchpoints do you actually need?

The right number of customer touchpoints

As brands juggle more and more channels to try and interact meaningfully with customers, are all these touchpoints helping or hindering?

The principle driving more choice in touchpoints is straight-forward. Savvy digital consumers want/expect greater access to brands in every way. But does building out channels to engage with consumers actually work? Or does it just bewilder a complex environment even further? And will omnichannel save us all? Well, it depends …

Customer touchpoints, says Kim Flaherty, can be defined as the specific point of contacts  between a brand and a customer that take place over the course of a customer journey. Each should be seen as a combination of channel, device and task. Bidirectional channels support two-way interactions and therefore focus on one-on-one interactions that take place across physical or digital channels. Unidirectional channels, or broadcast channels, support one way communication. Within these channels, devices act to bring interactions to life, but, and it’s an important point to remember, the devices themselves are the means to the interaction and need to be planned for on that basis. That said, the ways that consumers experience each channel will differ depending on the device. Different tasks of course are best suited to different channels and customers choose to pursue them on a range of devices.

The temptation for many is to provide as many channels as possible in a bid to be as convenient as possible. But access is only part of what customers consider when they (subconsciously) respond to any interaction. In fact, says Chris Ridson, they are looking for (and judging on) specific qualities:

  • They want the interaction to be appropriate to their personal need
  • They need it to be relevant to what’s required at that point in time
  • It must be meaningful – in that the customer feels that things are progressing for them as a result of the interaction
  • And it should of course be endearing – the interaction should strengthen the bond that the customer has with the company as a result of engaging with them.

By the way, there’s a great explanation of the difference between omni-channel and multi-channel here, together with really good examples.

In retail, shoppers expect to be spoilt for integrated choice

Research undertaken by BRP Consulting shows that customer expectations for seamlessness across touchpoints in retail are very high:

  • Most buyers expect to be able to move effortlessly between channels as they shop, starting and finishing the sale from anywhere. The research found though that only 7% of retailers currently provide such a unified approach.
  • Shoppers use mobile devices for education – many start their purchase research here by comparing products and checking reviews and ratings before committing to a store visit.
  • Shoppers want to be able to track their orders across all touchpoints because, according to the research, they remain concerned that their purchases are going to be lost in transit.
  • Most are looking for an automated returns process because that signals to shoppers that the process is likely to be more simple, that it is more consumer-focused and that it will happen faster.
  • Tolerance for bad experiences in-store is low. Over half of shoppers will stop shopping at a retailer after just one or two poor in-store interactions.

This recent study of 46,000 customers in HBR reinforces BRP Consulting’s findings and points to the merging of digital and physical touchpoints across the retail customer journey.

  • Consumers are increasingly using multiple touchpoints in all sorts of combinations and places. Those that did so spent on average 4%+ more on every shopping occasion in store and 10% more online than single channel customers. And the more channels they used, they more they spent – customers who used four or more channels for example spent 9% more on average than those who used just one channel.
  • Shoppers who researched online ended up spending 13% more in-store, suggesting that deliberation over a purchase yields higher returns than those consumers who buy impulsively.
  • And once they have bought, shoppers who used multiple touchpoints logged 23% more repeat shopping trips to retailers’ stores and were more likely to recommend the brand to family and friends than those who relied on a single channel.

So far, it seems, the more, the merrier when it comes to touchpoints. But two pieces of research by McKinsey point to the learning that while more channels are needed to a point, co-ordination is critical to success.

A closer look at touchpoints pre-purchase

The first piece of McKinsey research looks at interactions pre-sale. When a regional bank mapped its customer journeys, they found that 80% of prospective loan customers started at the website, but from there they sought answers in a range of ways. About 20% stayed online, another 20% called, 15% went to a branch, and the remainder abandoned. Of those that stayed with the process, more than 20% of those who went to a branch took out a loan, underpinning the point that for all the talk about digital convenience, human-to-human interactions are still highly effective. Of those who stayed online, less than 1% took out a loan. In fact, almost 80% opted out rather than fill in a form. Of those that called the contact centre, only 2% even requested an offer and just 0.1% ended up with a loan.

For all the talk about digital convenience, human-to-human interactions are still highly effective

The bank quickly recognised that the ways they had historically organised their interactions had led to customers pursuing a channel of interaction without the rest of the bank knowing that they had done so. To close this gap, the bank looked to match customer interactions with interactions between channels within the bank. That meant simplifying forms, revising policies to allow different channels to take the lead and forging new links between online and contact centres to allow personal follow-up when customers left forms unfinished.

Once these gaps were closed, successful fulfilment on enquiries increased considerably.

That squares entirely with Kim Flaherty’s point that the secret to success is that each touchpoint  – and all the touchpoints together – work in ways that feel consistent, seamless, specific to that context, orchestrated and collaborative.

And what about touchpoints post-purchase?

In the other study, which focused on interactions post-sale, McKinsey looked at the channels consumers value in the health sector. The  results revealed that while access to interactive options absolutely matters, more access is not always better. In fact, the research showed that interactions out-ranked brand as a consideration factor, and that consumers were willing to pay more, and at a margin that exceeded cost to supply, to gain more access to more options. But there were limits.

Consumers wanted to be able to speak with a ‘real’ person at a service centre rather than receiving back an anonymous response online. Specifically, they wanted to be able to interact through a combination of phone and mail as well as digital channels such as online, apps or video, and that combination was much more valuable to them than digital service alone. However, when more services were added, the inclination to pay more flatlined, suggesting that customers only recognised added value to a point and not beyond that.

5 things to consider when deciding customer touchpoints

Here are my key take-outs for those looking at how they organise their touchpoints to deliver more effective customer experiences:

  • Access is not conversion – it’s easy to get caught up in throwing a wider net when in fact, as the bank example shows, that may only lead to a higher cost-per-serve overall. I suspect that’s because while digital interactions are easy, they are not necessarily as ‘sticky’ as when people invest the time to seek out face-to-face help. Investment bias would suggest that the more people invest, the more likely they are to stay. And therefore, counter-intuitively in this age of convenience, one option that brands should look at is how they can offer interactions that require greater consumer ‘investment’ in exchange for greater experiential returns for the shopper and higher margins for the brand.
  • At a time when everyone is struggling to find ways to stand out, value-adding interactions offer opportunities to elevate brand interest – the McKinsey research shows a clear distinction between the helpful and timely interactions that customers now just expect to be delivered to them vs those that they see as value-added and worth paying more for. It’s important that brands distinguish between these different levels of interaction, keep the choice set limited and be clear about what interactions customers will invest in, and why. In other words, match channel options with clear value propositions.
  • Convenience is convenience – Marketers may see new technology such as chatbots as a significant opportunity to inject automated personalisation into their interactions. KLM Royal Dutch Airlines for example use a chatbot to text a full range of flight details. But while such software has a high convenience factor and meets consumers’ needs for quick digital interactions, chatbots are still automated tools and have some way to go before they could be considered a replacement for the human-to-human value-adding interactions identified above. I did find some nice insights from Genesys on how to build new opportunities through automation and AI: “While AI automates tasks, such as setting appointments, troubleshooting problems and other self-service tasks, humans are still critical to digital success. A blended AI approach that’s powered by an omnichannel customer experience platform, combines artificial intelligence, bots, machine learning and microapps with the power of humans—to create personalized, proactive and predictive experiences. Let bots collect information, process voice and digital data, and then analyze data at machine speeds. Then hand off to agents to nurture a more personalized service experience. By blending the best of AI and human interaction, you’ll deliver seamless customer and employee experiences—and have a powerful business differentiator.”
  • While most brands will want to keep their channel initiatives within their own ecosystem, the option to partner between brands may be one worth exploring – When Chris Wren looked at the take-over of Whole Foods by Amazon, he noted that both parties stood to gain from what their different backgrounds would bring to the ability for customers to interact. “What’s most interesting about all of this is the convergence of traditional brands and digital brands along an axis that is focused on utility, not merely expansion or acquisition. In order to be more strongly competitive in the growing food delivery segment, Amazon needed that crucial supply-chain piece that Whole Foods provides. And in order to stay competitive, Whole Foods needed technology infrastructure that could take the brand deeper into the digital space.” It’s a great point and one that points to an effective way for brands to merge their customer touchpoints and expertise to their overall benefit. It suggests that other brands may also find they have much to gain from mergers and acquisitions for example that enable them to then offer touchpoints that make the most of the combined skills and focus of the brands involved.
  • Think about the whole customer journey not just each touchpoint – While it’s tempting to look at touchpoints individually, the true opportunity lies in focusing across the whole customer journey and ensuring that customers have access to the right touchpoints in the right sequence to make dealing with the brand as personal, relevant, meaningful and endearing as possible.

As expectations continue to rise, brands will naturally be tempted to respond by trying to do more. But proliferation of channels, devices and tasks is not necessarily the answer and there is no blanket formula. As this white paper from Cognizant points out: “Organizations should look beyond providing an omnichannel experience and focus more on steering customers to the channels that best suit their patterns and preferences for engaging, communicating, and buying … The lack of a “right channel” strategy can result in low-value customers being served through high-cost channels. High-value customers who are steered to lower-cost, less personalized channels will quickly turn away.”

It’s important therefore for each brand to identify its baselines and ceilings. Baselines are the absolute minimum interaction points that customers expect – often digital, often free, not particularly valued but viewed as necessary. Ceilings are where customer touchpoints hit critical mass. You can add more if you want to, but doing so may just incur cost rather than securing greater engagement.

Note: A shorter version of this post has been published elsewhere under the title 4 Keys To Organizing Brand Interactions.

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