Would it bother you to lose a customer who had a 32-year-history with you?
It would devastate me.
Long-term client relationships are gold and not just from a monetary perspective. My long-term clients are people I enjoy working with and have gotten to know well. Our calls often begin with personal life catch-ups before we turn to business.
Moreover, repeat clients call me when they have a project. Other than my marketing newsletter, handwritten cards and postage, I have no customer acquisition cost for that business.
A 32-year-customer loss does not seem to bother Citibank.
Citibank issued a credit card to my friend Kathryn while we were in college. Kathryn always paid her credit card bills on time. Over her three decades with Citibank she earned a stellar credit rating and a five-figure credit limit.
Kathryn has been a Massachusetts resident for years. This summer she made the first of what will be many trips to Syracuse, New York. While there, Citibank approved her credit card charges for hotel and gas but declined her store and restaurant purchases.
When Kathryn contacted Citibank, the customer service rep told her that for security reasons the bank rejects purchases that they judge atypical for the user. The rep pointed out that their records showed her residence in Massachusetts.
“Apparently they don’t realize the states border each other,” Kathryn quipped.
My guess is that Citibank had automated the security check process to accept travel-related expenses like hotel stays and gas, but to reject more mundane purchases like restaurant and store charges that might be made by a thief who stole the card and was using it in another state.
Citibank made no attempt to reach Kathryn to verify the charges before denying them. Nor did the rep assure her that the problem would not recur on future trips to Syracuse.
Kathryn was annoyed by the inconvenience and not willing to endure random denials. She canceled her account.
Poof! Citibank’s lack of human intervention cost them a 32-year low-maintenance customer with a substantial credit limit whose business they paid nothing to acquire.
The Allure of Automation
As a business owner, I get the allure of automation and use it myself.
Automation enabled me to send this newsletter to you and all of my other subscribers simultaneously. I can’t imagine how many hours it would take me to send my newsletter out if I had to email each one individually.
Automation also allows me to set recurring reminders, to schedule social media posts and to update my website quickly.
I like not having to pay someone to do those tasks or take the time to do them myself.
Larger companies save a ton of money and keep their labor forces lean thanks to automation.
In a January 2017 report entitled “A Future That Works: Automation, Employment and Productivity,” the McKinsey Global Institute identified three areas of work activities that have higher technical automation potential: collecting data, processing data, and “predictable physical” (meaning performing physical activities and operating machinery in predicable environments).
The McKinsey Global Institute estimated that these three work activities account for 51 percent of total human working hours and $2.7 trillion in wages in the U.S. economy.
Companies have long taken advantage of automating these areas to eliminate repetitive jobs, reduce labor force size, increase consistency in service, save money and bill in a timely manner.
- Automated attendants answer the phone for large companies like Comcast, Verizon, Dell and Citibank. They also dispense information and troubleshoot common problems.
- Robots collect, pack and ship products.
- Virtually all data processing is automated, including banking and credit card transaction approvals.
- Online billing speeds payment collections.
The ease of use, relative low cost and benefits of automation have lured many businesses to adopt it wherever they could.
In some cases though, automation has run amok and caused major brand damage.
The Pitfalls of Automation
Once automation is installed, business owners like to set it and forget it. That’s the benefit of automation, right?
To a large extent that is true. But there are at least four major pitfalls brands risk with automation:
- Changes cause the system to break or go wrong. Automation operates on conditions that are programmed into the system. Sometimes changes to the system’s environment alter the conditions or require them to be altered to continue working. If you’ve ever updated your cell phone operating system and found that all your setting preferences were overridden by the update, you know what I am talking about.
- Exceptions arise. Automated systems get programmed to operate for the majority of cases, like Citibank’s fraud alert system on their credit card processing function. They cannot handle exceptions like Kathryn’s situation, unless they are programmed to do so. And exceptions will happen.
- Correcting automation errors requires human intervention. My credit card company occasionally puts a hold on charges I make to ensure that it is me using my card. It’s automated system then texts my cell phone and calls me to confirm that the charge is mine. If so, it releases the hold. But the hold functions as a denial to the vendor who submitted the charge. While the company’s automation solves the problem on the brand’s side, I still have to resubmit the purchase, which is annoying.
- People don’t connect emotionally to automated attendants. They connect to other people. You and your employees build the relationship with your brand’s customers. You can’t automate that.
Your marketing encompasses every time your customer interacts with your brand.
When automation means the experience is convenient and efficient, it reflects well on your brand.
When automation produces an incorrect result or is employed in an inconvenient or inefficient manner, it can cast a pall over your brand’s reputation. If you don’t have measures in place to fix the problem quickly and prevent it from recurring, automation can erode your brand image over time and diminish your customers’ willingness to do business with you.
Like when Comcast’s automated attendants don’t offer an option that matches your problem.
Or when Citibank denies a stellar customer’s credit card transaction.
Don’t Let This Happen to Your Brand
How do you take advantage of automation and still maintain the quality brand image that you have worked so hard to build?
Follow the Golden Rule. Think like a customer when you are considering automated systems and treat your customers the way you would like to be treated.
Automation’s lure of saving money and improving efficiency sometimes blinds business owners to the experience on the receiving end. Don’t fall for the razzle-dazzle. Experience the system as a customer and decide if it is one that would reflect well on your brand.
As you consider automated marketing and operations options:
- Litmus test them with the Golden Rule. If you dislike long automated attendant scripts and button-pressing odysseys, don’t subject your customers to them. Make it easy to reach a human. If daily emails drive you crazy, don’t send them that often. Even during the holidays.
- Empower employees to correct mistakes. Remember that your employees are the brand facing your customers in this situation. Train them to listen well, apologize for errors and follow through to rectify the situation.
- Avoid repeated mistakes. Nothing undoes a customer’s satisfaction from a resolved problem like having the problem recur. Citibank should have had a way to note Kathryn’s occasional presence in Syracuse and approve those charges automatically or verify them with her before denying them.
- Track mistakes and complaints. Keep a record of them and analyze it so you can detect systems and algorithms that are harming your brand and program improvements or change your system.
Customers, especially repeat customers, are the lifeblood of your brand. Treat them royally and don’t let the allure and pitfalls of automation undermine the relationship your brand worked hard to establish.
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