I am the first to admit that it is hard to feel sorry for cellphone companies. However, I must admit there is an industry trend that is really going against them and creating a real operational challenge. Specifically, smart phones are where the action is at in the mobile telecom industry and that is dramatically changing the nature of tech support firms must provide (Smart phones raise stakes for telcos, May 19, Globe and Mail).
Welcome to customer service in the smart-phone era. As cellphones become as complicated as computers, answering customer complaints is no longer a matter of simply reminding customers which buttons to push. It’s become a full-scale – and expensive – technology consultation, in which customer service agents like Mr. Singh are called upon to diagnose software and hardware glitches that can take hours to untangle.
An average service call costs a wireless company $5 to $12 to handle, while the fee for a complicated, lengthy call can soar to $30 or more. Yet Canada’s biggest wireless companies have no choice but to improve their customer service or risk losing customers to new wireless entrants.
“Smart phones are driving more calls per client and longer calls per client. And I’d say that’s a general industry challenge,” says Cameron McCuaig, who has been vice-president of client care at Bell Mobility for seven years. “In essence, we’re in the computer business now with all the functionality that you get in a smart phone.”
To put these numbers in perspective, my cellphone provider charges about $30 per month for data access. This says that one or two calls about getting to my email or getting some app to work and they are taking a loss on my data plan.
Oddly tempting, I know.
So how can they manage this? In some ways, their hands are tied. The industry is very competitive and cutting on customer service is probably a non-starter. That is, they could under-staff their call centers to save costs and dissuade callers. However, they have another channel. Cutting back in the call center will likely mean pissed off customers in stores with in some instances store personnel calling for tech support. The provider then has two employees tied up instead of one.
Another option is to charge for tech support as many software vendors do. The difference is that software vendors have sold a product. Telecoms have sold a service. I think that many customers would find it galling to be simultaneously charged for a service that isn’t working and then be charged for getting the service to work.
One thing that is possible is simply trying to keep calls from happening:
For Bell and Rogers (RCI.B-T35.41-0.59-1.64%), the challenge is to find ways to keep those costs in check without losing customers.
At Bell, these efforts are beginning to pay off. By putting manuals online, among other things, the company reduced the volume of customer service calls by 16 per cent in 2009 compared with a year earlier. In an attempt to better deal with increasingly complicated customer queries, Bell has reduced the number of calls outsourced to India. Those calls account for 3 per cent of calls so far in 2010 – down from 22 per cent in 2008.
Last year, Rogers appointed its first ombudsman to intervene on behalf of customers frustrated with the company’s traditional channels. It also set up an online help team that will quickly respond to queries typed out to an agent. And, like Bell, Rogers attempted to reduce customers’ reasons for calling by putting manuals and billing information online.
I would also expect that at some point this issue is going to come back to bite the handset providers. One of the challenges in handling these calls has to be determining whether the problem is driven by hardware, software, or the network. The service provider only totally controls one of those. Over time, what handsets a firm offers (or at least the deal they drive with the handset provider) will likely be influenced by what it costs to support them in the field.