Service on a shoestring

(FSB Magazine) -- Editor's note: This story was originally published in 2000. This is a republished version.

There's a thin ribbon of blue clay that slopes to a pool under one of Eastern Bordeaux's most renowned wineries, Chateau Petrus, causing less acid to touch the roots of its rich merlot grapes. The rose-flavored result, a superconcentrated wine that would be too harsh to drink without the influence of the clay, is limited to 4,000 cases per year. At about $700 a bottle, it is the most expensive, hard-to-get wine in the world. Once in a while, the folks at FinestWine.com will have it in stock and ready to ship at their little shop in Western France. If not, they will do everything they can for a serious customer, even if it means driving across the region to Chateau Petrus to buy the vintage themselves.

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But in the past, reaching someone live at FinestWine.com was a problem. Voice-mail boxes were overstuffed because of the limited number of customer-service representatives working the phones at the ten-person company, which expanded to the Internet about two years ago. Answering e-mail was laborious: Letters (which arrived through different forms based on the type of customer inquiry) were divvied up and sorted manually, with reps scanning each header for keywords indicating who was buying or who just wanted wine information. Customers who were lucky enough to tag their notes "Seeking rare merlot" received priority. Response to others was slow--delayed by both the mass of messages and the time-zone difference.

Something would have to change if the folks at FinestWine.com wanted their online customer service to match the class and level of help they offered in the actual brick-and-mortar shop in Bordeaux. But how is solid customer service translated to the Internet, where salesmen have been rendered obsolete and response time is rarely immediate? How realistic is it to offer customer service that every customer deems warm and worthwhile?

Read our Sept. 2007 update on FinestWine.com

"Impossible," says Rick Moses, vice president at Americana Resources, a Gaithersburg, Md., antiques mall that has been online since 1995. Moses is one of the two agents who pick through all incoming e-mail, and his frustration in trying to keep up is palpable. There are some strategies in handling e-mail, using live chat, and creating a discussion area for customers that help make the impossible somewhat possible.

No doubt it's hard, though. Even the big guys, who have huge budgets and enough tech-savvy people to work around the clock, can't seem to handle it. This past Christmas, ToysRus.com couldn't ship hundreds of Pokemon-packed orders in time for most people's annual gift opening. The irony, based on this type of service performance, is that shoppers can't tell that these sites invest tens of thousands of dollars per month into customer-relations solutions.

Customer-service packages at their slimmest, offered by service providers and software companies, start at an average of $2,000 a month. This is considered cheap and usually covers only one application (such as e-mail) for use by two or three customer-service reps. Kana Communications' Kana Response--targeting small businesses--is a thorough, glossy e-mail-management system. Customers' requests are automatically routed, tracked, and answered through customized templates. It's efficiently ideal--and it starts at $3,000 per month.

But does a company really have to spend this much to offer good customer service online? "There are free offers out there like live chat," says Kana's vice president of marketing, Joseph Ansanelli, "but no one offers as complete a communications solution as we do." Spoken like a VP of marketing. But after experiencing terrible customer service from one of these big companies--CDNow (a Kana customer) sent us a generic e-mail in response to an order inquiry, and it was later than promised--it's safe to conclude that good service must resonate from more than just expensive technology.

"There are things out there that don't cost a penny," says Jay Levinson, author of the Guerrilla Marketing book series, which targets companies with big dreams and tiny bank accounts. "It just takes investing time, energy, and imagination." And perhaps a bit of market research to know exactly how to spend that time and imagination. According to Jupiter Strategic Planning Services, 90% of online customers prefer human interaction but report that it's so expensive that most companies restrict it to their most valuable customers.

That's what FinestWine.com's Webmaster, Phillipe Lang, tries to do. With a free live-chat product called HumanClick, Lang uses a shopper-tracking feature to weed out the customers who he determines are just browsing. "We get a lot of people asking us what a bottle they inherited from their grandmother is worth. It drives me nuts," says Lang. "I try to get rid of visitors who I feel are not going to buy."

That's a risky strategy with potential to lose a lot of business if Lang guesses wrong about who's a browser and who's a buyer, but he feels he doesn't have much choice. After "watching" a customer pause to click on five or six $500 wines from above the Riviera, Lang can assume that the customer is "high value" and will initiate a conversation--through a small, white chat window--to get a sale rolling. To establish trust, something Lang cites as critical when expecting a customer to surrender a credit card number for a $1,000 cabernet, he'll instigate a more personal conversation--perhaps a chat about vacation-worthy wineries or what foods complement the almost-sold wine nicely.

And chat can translate into increased volume. FinestWine.com reports higher sales for the months that it has used live chat, and it hasn't cost a penny so far to deploy it. Al Heirich, CIO of SkiMall.Net, an online mall that spotlights local services and goods from Telluride, Colo., has five customer-service reps (mostly work-at-home moms who will never miss work because of a sudden snowfall) who chat with three or four customers at once--as opposed to directing only one person over the phone. "Live chat has increased our returning customers greatly and allows us to answer more of them," says Heirich.

Of course, this is only for the 12 hours live chat is available at SkiMall.Net. "On the Internet, time has shrunk. Customers expect you to be there then, waiting for a chat box to pop up," says Bill Santos, president of the Atlantec Group, a high-tech consulting company based in New Jersey. Companies such as FinestWine and SkiMall can't afford to have a rep waiting 24 hours a day, especially when the ratio of unique site visitors to service reps clashes by a landslide--as many as 1,000 customers per day to three reps. Santos recommends that sites manage expectations by posting hours of availability, and if customers reach the site off hours, make sure they can easily send e-mail.

All this chatter does cut down on the time that needs to be devoted to tackling the flow of e-mail. Some of what would have been e-mail disappears and becomes chat, but any site that continues to attract more visitors will see its e-mail tide rise as well. What's the best way to handle that tsunami, for lack of an extra $3,000 per month? "I just sit down and do it," says Jeff Rahilly at the nine-person Flexdex.com, a fiberglass-puffing, skateboard e-tailer in San Diego, "though it might take some time." Rahilly, a sales rep who's inundated with about 100 orders and sponsorship requests daily, tackles e-mail in two ways. First, Flexdex has separate, topic-specific addresses (info@flexdex.com, orders@flexdex.com) to help customers identify their needs and send them to the right place--thus urging them to "read before they e-mail." But to prevent the occasional wheel order buried beneath a trade show invitation, Rahilly uses Microsoft Outlook's filters with rules that let Flexdex route e-mail to a specific address. The program can direct order problems to one place and dealer inquiries somewhere else--and also make e-mail from Rahilly's boss visible the minute it drops into a special folder. While this e-mail sea-parting system helps makes things more clear, Rahilly and other reps still read through every message. It's taxing work--especially first thing Monday, when Rahilly gets a late start because of good waves and the Pacific time zone--but he insists that using these simple filters is the best way to deal with and satisfy customers.

Inevitably, though, no system is fail-safe. "Sometimes a filter may not catch what you thought it would," warns Mark Anthony, a business adviser with CPR Business Recovery, a small business consulting firm in Minnesota. Then your only choice is to "get on the phone or send a personal e-mail and tell the client you goofed; This adds a human and emotional touch to the relationship."

This touch of humanity, Anthony cites, is essential in keeping customer relationships somewhat personal--not to mention civil--in an automated world. "I've gotten a few nice little flamers [angry e-mails]," admits Moses of Americana Resources, "and the best way to deal with them is to maintain a level of professionalism--and respond quickly." Moses puts speed above all when responding to customers' concerns--such as an unexpected scratch on an 18th-century rocking horse--even if he has to crank out a "shorty" to soothe the customer while he's working to fix the problem. Customers, he says, shouldn't be left hanging.

That's what was worrying Tim Fong, CEO of LassoBucks.com, a business-to business bartering service that lets customers negotiate the worth of their services and then swap them--an accountant's time for a Web developer's ideas, for instance--online. Fong realized that based on the dates of the e-mails between service reps and site users, his customers' questions weren't being answered quickly enough. "LassoBucks.com isn't, at first glance, easy to use," Fong says. "People were slipping through the cracks." He began sending around usage information by way of a free e-mail list provided by Topica.com, to which any user can contribute comments by responding to a general newsletter initiated by LassoBucks.

"Community is the best way to describe it," says Anthony of CPR, describing the forumlike atmosphere that can result from people's contributing to a mailing list. Adds the Atlantec Group's Santos: "These sites are becoming more of an outlet--to get answers for critical products, problems, updates." In particular, the sites let customers answer one another's questions. "You achieve customer satisfaction without having done anything," says Santos.

"Customer service is a major commitment," says Fong of LassoBucks.com. "Everybody gives it lip service, but we find that it's a differentiator. Frankly, we looked at some more expensive solutions and weren't sure if they made it better." As Fong alludes to, technology alone is not the answer. In order for any technology to work seamlessly when dealing with customers, it needs to be paired with creative, innovative ideas and a companywide obsession with service--so the sense of isolation and abandonment that causes shoppers to flee sites can be minimized or completely eliminated.

"Good customers," says Anthony, "are not won on price but on service."