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E-tailers confront customer service challenges

Fielding customer service calls well could be crucial for online retailers this holiday season, which is expected to produce record electronic sales.

Even during this important holiday shopping season, many retail companies appear ill prepared for the perennial problem of handling customer phone calls.

Calls made to online retailers' customer service centers can mean hold times of 10 minutes or longer--if you are able to get through at all, an informal survey by CNET found.

One call to Seattle-based's service center, for example, resulted in 30 minutes of on-hold time before it was disconnected, an outcome that apparently surprised even the e-tail giant.

"That seems like an unusual occurrence. Call times vary," company spokesman Paul Capelli said.

Typical or no, such experiences could well be crucial in determining customer loyalty and future business for online retailers this holiday season, which is expected to produce record electronic sales. With the competition only a click away, time is of the essence.

"Consumers are increasingly expecting to have individual contact," said Mike May, digital commerce analyst at New York-based Jupiter Communications. "As the range of products for sale online expands from books and music to furniture and jewelry, consumers are going to want to have a little more reassurance before pushing the 'submit' button."

Many online stores offer abundant information on their sites to answer customer questions, through designated areas such as FAQs (frequently asked questions). But consumers often turn to customer call centers for more direct and specific answers--especially during the holidays.

As a deluge of Click or miss calls reach customer service centers, some e-tailers seem to be having a difficult time handling the load. A call placed to Aliso Viejo, Calif.-based's service center Thursday warned of hold times that could last 25 minutes or longer. A call placed to Denver-based Wednesday night lasted more than 10 minutes without an answer.

Traditional businesses such as Federal Express and Lands' End have raised the bar for all businesses when it comes to phone service, said Bob Chatham, customer relations analyst at Forrester Research in Cambridge, Mass. Such companies have a standard of answering the phone "on the first ring," Chatham said, adding that some online retailers may be hard-pressed to match this.

"There are some pretty well-established standards for how a retailer should perform over the phone," Catham said. "I think e-tailers are going to have to match what these bricks-and-mortar vendors are doing now."

Krista Pappas, an e-commerce analyst with Gomez Advisors in New York, estimated hold times of five minutes or more could prove unacceptable to consumers.

Some online retailers turned in good results in CNET's informal survey. Calls to Gap Online, CDnow and were all answered after less than a minute on hold. Despite troubles has faced in recent weeks with keeping its site up and running, a call to its service center was answered almost immediately by a service representative.

A representative at CDnow in Fort Washington, Penn., said the online music retailer has seen calls to its service center go up about 200 percent during the holiday shopping season. The company has augmented its service staff to handle the increased volume.

Amazon's Capelli declined to give statistics on the number of calls Amazon's service center receives or the average hold time customers experience, but said the company doubled its number of customer service representatives in preparation for holiday shoppers.

The e-commerce leader also has attempted to make its site easy to use so customers can help themselves purchase items, Capelli said.

E-commerce analyst Barry Parr at International Data Corp. in Framingham, Mass., said the stakes are high for e-tailers when it comes to customer service, especially those that don't enjoy Amazon's lofty position.

"If you lose somebody through complete nondelivery of customer service, that's worse than losing them through slow servers or site outages," Parr said. "That's really the thing that causes people not to come back. Of all the things you can do, it's probably the worst."