The FT Word
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Welcome to the April 2011 edition of the FT Word. Please forward it to your colleagues. (They can get their own subscription here.)
Topics for this month:
- April’s number of the month – 20%
- Transitioning from “free” to fee-based support
- The Stanford Five – can pain management apply to support?
- Invitations to talks, forums, webinars
The Number of the Month: 20%
Gartner predicts that in four year, about a fifth of users will make a social network the hub of their business communications, eroding the primacy of email. The death of email has been predicted for years, but I still find mine stuffed to the gills every morning (I know, I should stop sleeping, it’s so old-fashioned!) We will see if the prediction holds… One area where I find that social networks have much to improve is support for mobile users – or perhaps it’s our mobile devices that need to grow up…
The Gartner press release is here.
Transitioning from Free to Paid Support
Many thanks to Yaron Wilf for suggesting this topic.
Many vendors, having historically provided “free” support to customers, find themselves needing to limit the amount of free support they provide and move to fee-based support. Other vendors see a need to provide some basic level of service at no charge as a competitive differentiator. Here a 10 suggestions for creating a successful fee-based program alongside free support.
1. Start with a careful analysis of your customer base. Does your customer base expect some level of free assisted service? What are your competitors doing? Would providing free service create a meaningful differentiator? And do you have a segment of customers who will gladly pay to get extra service such as night or weekend coverage, a faster response time, or high-end features such as a dedicated support rep? There’s only one way to find out, and that is to ask the customers.
For most vendors, the answer will be nuanced, with some customers needing only basic assistance (and perhaps unwilling to make any level of financial investment in support) while others need a higher level of service and are willing to make an investment to get it. There is no substitute for doing your own research, although your competitors’ offerings will give you a good indication of where to start.
2. Provide copious self-service options. It’s much easier to limit free support if customers have attractive self-service alternatives. If you are transitioning from free support to fee-based support you must take an honest look at your self-service offer and make an investment to upgrade it if needed. It should be a lot cheaper than continuing to provide free support.
3. Limit the length and scope of free support. The first idea is to place limits on free support. This can be done either by limiting the timeframe during which free support is available, or by limiting the number of assisted support opportunities (or both). So for instance you can limit free support to the first 30 days or 60 days after the purchase. If you sell through the channel and it’s difficult to pinpoint the date of purchase, consider starting the support interval from the date of registration instead. Or you can limit free support to one or two support issues, or to a certain type of issues. A common approach is to limit assistance to product installation questions.
4. Limit free assisted support to less-costly channels such as online forums and email or cases logged on the web. I like using online forums for free support not only because you could benefit from peer-to-peer support, but also because any help you provide to users will be visible and potentially helpful to others. Another common approach is to push customers to an email or web-based channel. And you can also keep a lid on free support costs by using lenient response times, say a 24-hour turnaround on requests. Before you make a decision, carefully consider customers’ needs. If issues typically requires multiple interactions you could be better off financially using phone or perhaps online chat. Don’t be blinded by the cost of a single interaction, consider the entire transaction – and the impact on customer satisfaction.
5. Provide fee-based alternatives. Customers do best when they have an array of choices. For instance, offer consumers a choice between complimentary self-service, a monitored forum, and fee-based single incidents. Offer businesses a choice between complimentary assisted support with a 24-hour turnaround and a fee-based subscription with a 4-hour (or 2-hour turnaround – and additional fee-based options with faster response times and 24×7 coverage. (Adapt this general recommendation to the needs of your customers. In particular, consumers may react well to subscriptions, and many vendors find no need to provide free assisted support to business customers.)
6. Set up the logistics. There’s one wonderful aspect of free support: it requires minimal logistics! Fee-based support is hard work. You have to track who is eligible and what has been delivered, and you need a mechanism for handling support sales. Set up the tracking and sales processes and tools so they work smoothly. This is a good opportunity to contrast the cost of administering a fee-based program versus the savings on the delivery, and to adapt your plan to what you can realistically accomplish. For instance, if tracking the number of issues reported by each customer is difficult, you may be better off to instead limit support by time. Another common tradeoff is whether to charge customers per incident or via a subscription.
7. Check whether long-time customers can be cut off. If you have provided free support in the past and want to discontinue it, make time for a discussion with your legal team. Long-time customers may have been promised free support for life. Contracts are often written in reasonably loose language so that you are not obligated to offer phone support for life, or even any kind of assisted support, but do check!
8. Message appropriately. Customers need clarity. Tell them what they get for free, and under what circumstances. (and if you cannot describe the restrictions clearly, start over!) Tell them that they need to register to get free support, if that’s the case. Tell them about the fee-based alternatives. For new customers, the most important thing is simplicity, which can be a challenging if you have lots of options. For existing customers, be upfront about the changes. In either case, maintain a positive tone when describing the free options. You want to encourage customers to use fee-based support but don’t make it sound like free support is awful. It’s just limited.
9. Anticipate backlash and prepare a response. If you are moving from free support to fee-based support, customers will understandably feel that you are taking something away from them so carefully craft your message to highlight both the free options and the fee-based options. Decide in advance how you will work with customers who complain about the new policy: you don’t want to train your customers to complain to get preferential treatment, nor do you want to expand more effort in appeasing them than actually delivering the service. If you are continuing to provide free support in some form, the backlash should be limited, and any dropoff would be from the less profitable customers. It all goes back to how well you did your homework in step 1.
10. Educate the support team. In the end, the support staffers are the ones who work with customers and are on the receiving end of questions and complaints. They may feel it’s terribly unfair to cut off free support. They may feel that their jobs are at stake (and they may well be right about that!) So just like you need a clear message to customers you also need to explain the change to the support staffers and give them tools to explain the change to customers.
Selling Value contains more information about how to structure, price, and deploy support offerings.
The Stanford Five – Principles for Pain Management and Support?
While reading an interesting book called The Pain Chronicles (and don’t worry, I’m not in pain myself; this was strictly intellectual curiosity), I came across these five principles for physicians to use when evaluating patients with chronic pain problems, and I thought that they would apply very well to Tech Support. The Stanford Five suggest that physicians explore these points:
- Patient’s belief about the cause of the pain (cancer, muscular strain, etc.)
- Meaning of pain from the patient’s perspective (association of pain with ongoing tissue damage, sinister ideas of pathology)
- Impact of pain from the patient’s perspective (has it disrupted their social, vocational, recreational activities)
- Patient’s goals (to be happier, to be less depressed, to go back to school of work)
- Patient’s perception of appropriate treatment (including whether the patient wishes to be referred to other specialists)
How about creating the Support Five, as follows:
- Customer’s belief about the cause of the problem (third-party product, bug, etc.)
- Meaning of the problem from the patient’s perspective (data corruption potential, functionality loss compared to past release)
- Impact of the problem on the customer (has it disrupted their productivity, ability to serve customers)
- Customer’s goals (to avoid a recurrence of the problem, to find a workaround, to get a fix)
- Customer’s perception of appropriate resolution (including whether the customer needs a post-mortem analysis of what happened)
What do you think? I will include this idea in my Troubleshooting workshop.
FT Works in the News
May will be busy! Join me in person or virtually at any of these events.
If you’re planning to attend the TSW conference, I hope to see you there! And I will be giving two presentations
- One is a pre-conference workshop on the first day, Monday May 2nd, entitled A Gold Mine? Calculating the ROI of Community Projects. In this interactive session we will build a meaningful ROI for your community. Bring your computer and I will provide the spreadsheet template. More information here and also in an interview I did with John Ragsdale, here
- The other is a workout session I will facilitate with Rob Shapiro of Oracle entitled Start the (Metrics) Revolution, discussing metrics and best practices for support communities in an open discussion format. Please join us on Tuesday May 3rd at 2pm and add your voice to the debate.
To register for the workshop or for the conference, go here (and yes, you can attend the workshop without attending the entire conference!)
CustomerThink is hosting a virtual summit on Thursday May 12th about Social CRM Best Practices and I am a featured speaker. I will speak about Integrating Social Media into Your Customer Service Strategy and specifically about ROI for communities and there will be plenty of time for questions.
You can find more information here: http://bit.ly/dTIc8W
Are you based in the San Francisco area (or will you be there on Tuesday May 17th)? That morning, David Kay and I will be hosting The Third Tuesday Forum, a roundtable for support executives to discuss the topics we embrace and wrestle with every day. The presenter will be Robert Binkley of Xilinx, who will speak about a topic very near to my heart, ROI, and how to sustain ROI analyses beyond the justification step. You can register here. The full calendar is here. You can also sign up for the mailing list. You will be the first to know about new events. You can also join the Third Tuesday Forum groups on LinkedIn and Facebook.
Curious about something? Send me your suggestions for topics and your name will appear in future newsletters. I’m thinking of doing a compilation of “tips and tricks about support metrics” in the coming months so if you have favorites, horror stories, or questions about metrics, please don’t be shy.
650 559 9826
About FT Works
FT Works helps technology companies create and improve their support operations. Areas of expertise include designing support offerings, creating hiring plans to recruit the right people quickly, training support staff to deliver effective support, defining and implementing support processes, selecting support tools, designing effective metrics, and support center audits. See more details at www.ftworks.com.