Talking Shop: Customer service on the Web

by Mary Ann Fitzharris | Apr 13, 2000 7:00:00 AM

Takeaway: Cost benefits of customer service provided via a Web site

Call centers can be the heart of customer relationships. When this service is handled on the Web, it can also be cost-effective. Taking care of customers' needs online enables you to save money by reducing telephone calls and bypassing customer service representatives. We’re talking big savings for companies and major revenues for CRM (customer relationship management) vendors.
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Companies are increasingly relying on the Web for their customer service needs and finding it to be a very effective way to reduce costs. The customer can make a purchase, send an e-mail inquiry, or get basic questions answered via a FAQ (frequently asked questions) section—all without the help of a service rep. According to a whitepaper by Continuity, a California-based CRM solution provider, 35 percent of customer contacts will be made via a Web site, e-mail, or other electronic means by the end of 2000. If questions remain, there’s always the opportunity for a customer to speak with a representative.

Meanwhile, long-term profits are realized when your first line of customer inquiry is handled on the Web. Additional online customer service includes post-sale follow-up and customer feedback.

AMR Research predicts dramatic growth in the CRM software market, reaching $16.8 billion in revenue in 2003 (see chart 1). International Data Corp. (IDC) says that by 2003, companies will pay $90 billion a year for CRM consulting services, hardware, and software.

When The Yankee Group asked customer care managers about their plans to use the Web to handle customer service, they reported a gradual move to the Web through 2001, and then a more dramatic increase by 2003. (See charts 2 and 3.) This optimism is also reflected in The Yankee Group’s forecast for gradual increases in both traditional and Web-based sales and support, with a strong spike in Web-based support after 2002.