Is a rebrand in your future? Don’t do anything without this list of five must-ask questions.   GET THE LIST

Customer Service Is NOT The New Marketing

A Snarketing post by Ron Shevlin, Director of Research at Cornerstone Advisors

One of the blurbs in a recent Adweek/IQ Daily Briefing email posed the question: Is customer service the new marketing? According to the email:

Nowadays things are changing. Customers looking for products simply type them into Google. Assuming you can get customers this way, the hard work then begins: keeping them. That’s why, according to Andy Ridlinger, customer service is now serving the role of marketing. “Companies need to start treating customer service as an investment rather than an expense. The necessary ‘white glove’ level of service required to create raving fans is more expensive in the short-term, but in the long term you not only spend less supporting current customers,” he writes. “Their free word-of-mouth marketing will help you add more customers.”

My take: This is a ridiculous, terrible, and misguided idea.

If customer service is now serving the role of marketing, then who’s planning and executing campaigns? Who’s determining the allocation of marketing spend across channels and programs? Who’s figuring out which customers the firm wants as “raving fans” in the first place?

The customer service department? The department in which it isn’t unusual to see 40-60% annual turnover among personnel? The department that is increasingly outsourced to some offshore service provider?

I need to stop, I’m laughing too hard to continue.

The notion that “customer service is the new marketing” is the epitome of cumbaya marketing. “Let’s just be really really nice to customers and they’ll tell all their friends and we’ll make money hand over fist.”

There are a host of problems with the notion of the customer service department as a profit center. First and foremost is that it can incent service reps to focus on selling rather than problem resolution. Example: How many times have you called in to your credit card provider with a question or problem, only to be barraged with balance transfer offers? Second, the people who are trained to resolve problems often lack knowledge about the products, and typically aren’t trained in selling techniques in the first place.

I don’t mean to diminish the importance of great customer service. In the scheme of things, it’s critical to retaining customers — and establishing a reputation that helps win new customers. But it isn’t the same as marketing. And it hardly is a substitute for existing marketing functions.

I expect to hear crap like “customer service is the new marketing” from vendors trying to hawk their technology, and from people who have a year or two’s worth of business experience. But for Adweek to legitimize this notion is irresponsible. And I couldn’t help but groan when I saw a Web page recently for a conference called Customer Service Is the New Marketing (I won’t honor it with a link). It pained me to see somebody I respect on the speaker slate.

This really begs a deeper, more fundamental question: Why would Adweek put this in its daily briefing in the first place?

The answer, I’m afraid, has to do with a lack of understanding of, and often disagreement about, what marketing is in the first place. Unlike the accounting or manufacturing functions in an organization — which are well defined, understood, and undisputed — the marketing function is often interpreted differently by different types of execs and by different types of firms.

It’s what I’ve referred to as marketing’s civil war — the culture clash between the brand-oriented marketers and the quantitative-oriented marketers. The customer service-oriented marketers are just a new faction — thankfully unarmed, underfunded, and for the most part unable to participate in this war.

Technorati Tags: Marketing, Customer Service, Adweek

June 4 Update: I’m not going to change the original text of the post, because what’s out there is out there, but I’d like to apologize to Adweek and retract the comment about it being irresponsible for including this in its email. The original email asks “Is Customer Service The New Marketing?”, not states “Customer Service Is The New Marketing.” The rest of my thoughts on the topic remain unchanged.

Ron ShevlinRon Shevlin is Director of Research at Cornerstone Advisors. Get a copy of his best-selling book, Smarter Bank: Why Money Management is More Important Than Money Movement. And don't forget to follow him on Twitter at @rshevlin.

All content © 2017 by The Financial Brand and may not be reproduced by any means without permission.

Digital Banking Report | 2017 Marketing Trends

Comments

  1. I think Adweek was trying to come up with different headline than “Customer service is the key to loyalty.” Another case of creativity obfuscating communication?

    Expectations of marketers have eroded. Most marketers today aren’t expected to have the same skills marketers required 30 years ago, primarily because they don’t have the same responsibilities. Of the classic (and terribly oversimplified) “Four Ps of Marketing,” the only one modern marketers seem to be responsible for is “Promotions.”

    Marketing responsible for Pricing? No chance.

    Modern marketers are often equated with “feelings” and “colors.” That’s certainly part of marketing. But a marketer with real power employs more traditional skills, as Ron suggests.

    Is this a “civil war” or a “culture clash?” That’s perhaps a bit drastic. You don’t hear too many heated battles over this issue. More like heavy sighs after a CMO leaves after 16 months of doing nothing.

  2. I have to disagree with your dismissal of customer service as a channel that can be leveraged by marketing. I do believe that customer service is one of the most important touch points that customers have with your company and that it should therefore be part of marketing.

    I agree that you do not want to turn a customer service department into a marketing campaign engine, but if you look at zappos.com, there are companies who are *very* successful in leveraging the customer service department for sales and marketing.

    Francois

  3. Jeff Hassemer says:

    Francois –

    I don’t see that Ron is “dismissing” customer service as a channel for marketing at all. In fact, he states, “I don’t mean to diminish the importance of great customer service. In the scheme of things, it’s critical to retaining customers — and establishing a reputation that helps win new customers.”

    To assume that customers will beget new customers from word of mouth is just naive. (To be clear, I don’t think that you were advocating that position, but the original article was). The fact is that Marketing is an extremely intense and difficult discipline that has become increasingly harder with the advent of new channels. Being able to allocate the marketing budget to effectively across a growing number of customer interaction points to acquire and retain customers is complex. The job is made more difficult by poor customer service and crappy product design.

    It takes a set of individuals that can think both analytically and creatively to define the right mix of offers to keep up the influx of new customers and overcome the issues created by our co-workers on the service side. Forgive us if we get a little bit passionate about our jobs when some Moron CFO or Customer Service Guru (again, I’m not calling anyone in particular the moron here..just generalizing) thinks that they understand the marketing discipline well enough to come up with a “brilliant” marketing concept that we somehow overlooked.

    Fact is, we live in a world where the pace of change is rapidly accelerating. Consumer’s have more choices and more ways to interact with our companies than ever before; and it is only going to grow from here.

    Over simplifying a complex problem will take us no where.

  4. @Francois: Jeff is right, I’m not dismissing the importance of the customer service function. But you raise an interesting question (or should I say, open a can of worms) by alluding to customer service as a marketing channel.

    Yes, cust svc could be a “channel” just like the online channel, email, direct mail, etc.

    But most financial services firms that I have dealt with set limits or guidelines for how many marketing messages per customer they allow, or feel is appropriate, for a given timeframe.

    I have yet to see a firm, however, apply that kind of rigor to the “customer service” channel. Oh no, if you call in, you’re fair game to get hit with a marketing message. Regardless of whether or not you’ve just received an offer thru email, direct mail, or targeted banner ad.

    To me, the spirit of the Adweek blurb — and the blog (or whatever it was) — that the “customer service is the new marketing” quote came from was a dismissal of the “old” ways of marketing, because “nowadays things are changing”.

    I simply wanted to take that notion down and refute it.

  5. George Pasley says:

    The scary thing is, some executive will read that article and interpret it as “customer service = new sales channel”. I think decision makers forget the purpose of customer service, which is solve the customer’s problem.

    I have never picked up the phone and called a company just to say hello. When I call, it’s because I have a problem and I couldn’t figure out how to fix it after looking at the web site. I don’t want to be sold anything, I just want my problem fixed.

    If companies want to make an impression on me, solve my problem at Level 1 support. And don’t have me sitting in multiple phone queues either.

    On a side note, while providing customer support for an online banking user, I found that if you curse a lot when you call a certain cable company, you will be pushed ahead to a live person a whole lot faster. Glad the customer was ticked at the cable company instead of us…

  6. Brian Morrissey says:

    Hi Ron,
    I’m the digital editor at Adweek. One of my tasks is to put together the IQ e-mail. I’m glad you get it. I included the blurb in our “other stories in digital media” section, where I try to point to interesting, even provocative things written elsewhere, usually in blogs. The blurb is pointing to a post by Andy Ridinger of Mural Consulting. Check out his full argument — I’m sure I didn’t do it justice in my couple of sentences about it. http://furrier.org/2008/06/01/sales-20-social-media-support-is-the-new-marketing/

    I won’t get into whether Andy’s right or wrong. That’s for others to debate. Yet I do want to point out that it’s not “irresponsible” for Adweek or anyone to link to an opinion you don’t like. It seems to have succeeded at least in stimulating an interesting conversation.

    Thanks,
    Brian

  7. @Brian: Thanks for commenting — much appreciated. I owe you an apology. Going back to the email, I see that it ASKS “Is Customer Service The New Marketing?” and doesn’t STATE, as I thought “Customer Service Is The New Marketing”. Very different.

  8. Adelino de Almeida says:

    It is a cost, it is an investment, it is part of retention marketing, it is not a silver bullet.
    In the absence of good products and effective advertising, it is unlikely that customer service will do much for a company.

  9. John Furrier says:

    I posted Andy’s story after he and I were talking about the future of online advertising.

    Do you know what i just realized – You don’t get it.

    I think that you might just be out of touch with how consumers actually think and work.

  10. It is only if your customer service is so great that people rave about it that it becomes a way to get new customers. And, that rarely happens. People are calling customer service because they have a problem. At a minimum, they want their problem solved; that’s what they expect and that’s what better happen or you have the exact opposite (bad word of mouth) happening.

    Can customer service ever replace marketing? Probably not. But it needs to be aligned with marketing and with sales, too.

    Great discussion.

  11. Jeff Hassemer says:

    @John –

    I think that you are missing the point. In fact, I think that many who read this blog see the issue much more clearly than what I’ve read of Andy’s post.

    There is no doubt that social media and Web 2.0 is growing in importance in the channel mix of marketing. Similarly, there is little doubt that superior customer service is a key to obtaining and retaining customers. That said, you cannot describe a single transaction path taken by a customer and put a stake in a ground that this is the way all customers interact with your company. I hate to break to you online folk, but not all transactions occur solely online. (and before you get your panties in a bunch about an old world marketer making that comment, I am well steeped in online marketing and have worked in Search, Email, Ad Serving and behavioral targeting for the past 10 years…in addition to my offline background).

    In your post, you state your case by saying…

    “Well, what did you do the last time you were interested in a particular item or service? You probably looked it up on Google. After you found the company’s website, you probably also looked at the other links your Google search returned, including blog and feedback posts by others who had already used the product. Assuming you were still interested, you downloaded the trial version, installed it, and started playing around with it. You may have even checked out more blogs and message boards to ask specific questions about the product of other users. Finally, you decide you like the product, so you click the activate link, enter your payment info into the site, and purchase the full product.”

    That’s a possible path, how about another. Your customer receives a catalog, identifies a product that they like, go online perform a search, then abandon. A day later, they get an email, reminded of their desire for the product, they head to the retail store to purchase, but not before calling their friend who just purchased the same item to see if they liked it. You’ll have to forgive me if I miss where customer service did any marketing in that stream.

    The point is, most of the database marketers that read this blog understand that marketing is a complex discipline that requires the use of data to determine how to craft a customer experience across multiple channels. And we rarely make simplifying statements like, “Customer service is the new marketing.” or “RSS is going to kill email” We are steeped in the social media revolution and many have lived through new marketing channels coming online and dying off. And we understand how to interpret the data to ensure that we are not following another fad marketing channel.

    Oh yeah, and for those of you who aren’t aware…this social media thing is a real channel. You’ll need to learn how to harness and use that information quickly. I’d start looking into that as a marketing vehicle now.

  12. John Furrier says:

    @Jeff #11,
    I am not suggesting that old marketing techniques will die but I do agree with you that market discipline is complex. However it just got more complext with web 2.0 or whatever you want to call it.

    Fact is with online connectedness users behavior is changing where support is not a silo’d thing (customer calls when in need). Online and offline experiences are taken online and users want relationships with customers.

    The core issue in this discussion is the impact of ‘real time’ communications and the role of the marketer in that. take the current users behavior: realtime communicatioins on the web and mobile, asychronous consumption, and offline activity and you have a marketing data nightmare and opportunity.

    Customer support is not a silo’d activity in a linear value chain. Thats my point and the point of the author of the post (i believe). Certain existing marketing concepts, paradigms, disciplines, and metric will have to be retooled. No one is there yet.

    The best thing about the new modern web is everthing is measurable and the biggest problem on the modern web is everything is measurable.

    Figuring out what to measure is a marketers key to success.

  13. Peter Drucker said many years ago:

    “The only purpose of business in society is to create a customer”
    When we had four channels on the Telly and gathered around to watch Gunsmoke – we also oooohheed and aaahhhhed over the Campbell’s soup ad. That created a customer.
    Game over.
    Traditional marketing efforts (aka old) are just noise and junk. Look at the most successful companies today. Apple. You think marketing is creating and keeping those customers?
    I would argue the Genius Bar is. At least for me. Sure, marketing probably designed their badge and t-shirt, but that’s just packaging. How the Genius handled my problem made me want to plunk down thousands of dollars in that store.

  14. @Denise: And I suppose the Genius Bar just magically appeared one day, eh? Somebody at Apple had to do some analysis, strategic thinking, etc.

  15. @Ron – and why could that thinking NOT come from a Customer Service Department?

  16. @Denise: No reason why that thinking couldn’t come from Cust Svc dept or any department. But let me ask you this: If a janitor came up with the idea would you claim “Janitorial Services Is The New Marketing?”

    Of course not (or should I say “I hope not”?).

    Marketing is a business function and discipline, Denise. Just because something impacts a customer’s relationship with a firm doesn’t make that thing “marketing.”

    This is a point that you and your fellow cumbaya marketers don’t seem to understand.

  17. @Ron

    You said: Marketing is a business function and discipline – I say it WAS……now it’s more organic than that. If you think that’s cumbaya, well, so be it.

    But folks like Apple get it. Someday perhaps you will.

  18. @Denise As of June 6, Apple has 96 job openings posted on its site for its Marketing department. According to the site:

    “The world-class marketing team at Apple is focused on leading-edge hardware and software that define the solutions that customers want, prompting the competition to emulate us.”

    Please note that not one of the positions has anything to do with the Genius Bar.

  19. @Ron – what does that prove? Besides my point.

    The Genius Bar is genius – probably not from traditional marketing. Those folks are making name badges and t-shirts and cool packaging for my next iPhone.

  20. I am late to the table on this discussion, but glad I got here just in time. While I agree the Adweek quote is too simplistic, that does not in itself make the counter argument right. After I re-read this a couple of times, I realise that everyone is seeing the problem through 1980’s organisation structures.

    Customer service = outsourced call centre
    Marketing = running campaigns

    What about:
    Community manager = ??
    Wiki manager in charge of product design = ??
    Blog comment group = ??

    I think I have to do my own post on this 🙂

  21. Name Bages says:

    Dear Denise,

    Have a look
    Plastic badges manufactured by Simoney Badges are very well-known. A plastic name badge is worn mostly by company employees. Some people wear plastic badges to enhance their overall outfit. The plastic badges from Simoney Badges are the best!

    Fortunately, Simoney Badges know all these facts and they translate all these excellent characteristics in the plastic name badges they produce. So, if you go with Simoney Badges products, you cannot go wrong! Just visit the Simoney Badges website, place an order for the name badges you want, plastic or otherwise, and let them give you satisfaction more than you expect!

    Plastic badges have a certain edge over other types of name badges. They are more durable. Moreover, people have expressed that plastic name badges are light and therefore very nice to wear. The plastic badges from Simoney Badges are things you can wear easily and proudly!

    Thanks,
    simoney.co.uk

Speak Your Mind

*

Show Comments