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Commentary: Customer service differentiates Web retailers

With competition only one click away, poor service and support will drive customers to competitors' sites, which results in lost revenue and unfavorable recommendations.

By Carol Ferrara, Gartner Analyst

Not surprisingly, consumers increasingly select e-tailers that provide the best service. With competition only one click away, poor service and support will drive customers to competitors' sites, which results in lost revenue and unfavorable recommendations from defecting customers.

Fortunately, e-service

See news story:
Some e-tailers still missing customer service boat
is improving as brick-and-mortar enterprises and even some dot-com companies begin to realize that service is often the only thing that differentiates them--in the all-important eyes of the customer--from competing sites.

When Gartner recently reviewed 50 of the top-rated consumer e-tail sites on their customer service capabilities, the results were abysmal. None of the Web sites were rated as exceptional or even good in customer service, 23 percent were rated average, 73 percent were rated fair, and 4 percent were rated poor. Despite those disappointing results, the sites have actually improved compared with the situation 18 months ago. At that time, FAQ support--that is, answering frequently asked questions--was the only service provided on 99 percent of sites.

E-service capabilities will become even more important as the Web becomes a more mainstream shopping and servicing channel and as more complex and luxury products proliferate on the Web. Those sites will require exceptional customer service, as consumers who cannot touch the products, will have greater uncertainty, and will require more reassurances.

Sites that provide exceptional customer service have been designed from the customer's perspective. They prioritize customer service needs, are easy to use and to navigate within, and provide a variety of alternative customer service options. Exceptional sites provide both FAQ and search capabilities to enable customers to find the answers to their questions easily. They provide information on the history of customers' interactions with the site.

Exceptional sites also provide for collaboration so that customers can ask for and receive assistance at the time they need it, without dropping off the Web site. Those sites invite customers to send emails from every page on the site and respond to the messages quickly and accurately. Phone and email channels should be fully integrated, and the phone representatives should be pleasant, knowledgeable and efficient with their delivery of service to the customer.

Truly exceptional sites provide voice over IP as an option used in conjunction with the collaboration capabilities to make it as easy as possible for site users to request and obtain service.

Web-based customer service continues to be a major challenge for e-tailers, which need to make substantial investments in new technology and processes if they want to use e-service to retain their customers. Exceptional e-service will increase customer "stickiness," resulting in increased sales, loyalty and retention.

(For related commentary on five CRM issues enterprises should consider, see TechRepublic.com--free registration required.)

Entire contents, Copyright © 2000 Gartner Group, Inc. All rights reserved. The information contained herein represents Gartner's initial commentary and analysis and has been obtained from sources believed to be reliable. Positions taken are subject to change as more information becomes available and further analysis is undertaken. Gartner disclaims all warranties as to the accuracy, completeness or adequacy of the information. Gartner shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof.