THE EFFECTS OF TWO- WAY TEXTING ON THE CUSTOMER JOURNEY

Transcription

1 THE EFFECTS OF TWO- WAY TEXTING ON THE

2 10PTS The average increase in Net Promoter Score for brands that added twoway texting to their channel mix. Executive Summary Two-way text messaging increases customer satisfaction, net promoter score, and customer effort score in the post-purchase customer service phase of the customer journey. It s also the least expensive channel, and reduces expensive channels like phone calls by 40%. The general ROI on implementing text messaging is between 700% and 1400%. As brands struggle to truly enhance the mobile experience, those who implement two-way text messaging are perceived as mobile-first innovators. The biggest surprise in metrics from adding text messaging comes from before the customer service phase of the customer journey. Brands see a 3% to 15% increase in acquisition from top of funnel and middle of funnel tactics. A key takeaway is that text messaging has a positive halo-effect on the customer journey because it is where consumers spend time already. The next few years will see a major shift in building out the tool sets for conversational commerce.

3 Implementing new channels for customers to communicate with companies can create major shifts in customer satisfaction, wait times, and inbound ticket count. Text messaging will be an initiative in more than 78% of all contact centers before the end of 2017, making it the next big channel enterprises will be testing. Phone calls, which launched for customer service in the 1950s, have been the staple channel for generations. Web chat, , and social have all been added to the mix in the last 25 years, but none have lived up to the expectation of replacing phone calls or even improving customer satisfaction. Additionally, consumer behavior shifts have created more conversational expectations, and contact centers are becoming a vital part of the customer journey prepurchase. There is little known publicly about the effects of two-way texting with customers and enterprises because it s such a new channel. This whitepaper is a collection of available data from more than 100 enterprises. Better Measurement Across the Customer Journey In late 2007, text messaging surpassed phone calls as the primary means of communication between US consumers. That same year, the iphone was released, and the wheels were set in motion for a major consumer shift from desktop-based internet surfing to mobile-based internet surfing. GPS and LTE (4G) services, combined with larger screens, billions of app downloads, and massive improvements in mobile web surfing experiences created a perfect catalyst for the consumer shift that prompted corporations to begin thinking mobile-first. Concurrently to the mobile shift in consumer behavior, data and analytics tools were adopted rapidly by many departments in virtually every enterprise. However, the adoption of services in siloed environments meant sharing data between departments was difficult. Marketing was the leader in analytics, with product fast following their lead. Customer service teams had always measured the measurable such as call time and number of contacts per hour, but the analytics tools that measured up-andcoming metrics like Net Promoter Score (NPS), Customer Satisfaction (CSAT), and Customer Effort Score (CES), were just beginning to roll out.

4 Despite the sudden abundance of tools for measurement, the siloed nature of the implementations meant that data across the entire customer journey was fragmented and correlation between A and B was anecdotal more than anything. Today, however, the customer journey is trackable from awareness through loyalty. This availability of data has made clear two things: consumer behavior is much more inquisitive as consumers ask far more questions than 10 years ago, and contact centers have a massive opportunity to shift from cost centers to profit centers. TEXT MESSAGING ACROSS THE For consistency, the customer journey referenced in this whitepaper is the McKinsey New Customer Decision Journey, published in The key differences between this journey and previous is the shift in importance of the awareness of a brand prior to beginning the journey. Before smartphones, consumers knew on average 12 brands for each product type. For example, consumers were aware of 12 different shoe brands before ever even beginning their journey from I need shoes to I bought shoes. So why does today s consumer know just 3-4 brands before beginning their journey? That is the key shift in consumer behavior the evaluation stage is far more important now than it was previously. Rather than evaluate 12 brands, consumers today will search for additional brands in the evaluation phase. It is in this phase that brands who lower the barrier for consumers to evaluate their product can control the rest of the journey for their potential customers. The criticality of this information cannot be emphasized enough. The lower the barrier for consumers to evaluate a product by asking questions about it, the greater the probability they will purchase the product. The contact us page has become the first place consumers go when evaluating a product, and if contacting the brand is difficult, they head to social reviews, which are far harder for brands to own. The lower the barrier to ask questions, the higher the satisfaction for customers, and the higher the probability the consumer will become loyal to the brand. TEXTING FOR CONSUMERS IN THE CONSIDER PHASE OF THE The top of the funnel (TOFU), is where brands aim to increase awareness and consideration of their products. From billboards to radio spots, the widest swath of messaging creates awareness for the greatest number of consumers. The majority of these TOFU-focused tactics utilize a web address for consumers to find more information. The measurement for TOFU tactics has been lower than for any other area of the customer journey, so advertisers have started putting calls to action such as Use Code BILLBOARD for 10% off in order to more-accurately measure TOFU tactic effectiveness.

5 A 100+ year old fashion brand recently took out TOFU-focused ads in the New York Times directing customers to text with them. Another fashion brand directed a TOFU-based campaign in SoHo that called out, TEXT TO BUY on the ads. The addition of texting to TOFU tactics instantly opens a gateway for consumers to go directly to the buy stage of the funnel by combining the evaluation phase with the consider phase. Knowing that consumers will eventually evaluate a product via conversational channels, brands that embrace adding texting to their TOFU tactics see between 3% and 5% increases in acquisition. TEXTING FOR CONSUMERS IN THE EVALUATE PHASE OF THE When it comes to acquisition, this is the strongest pre-purchase area of texting impact. Brands that utilize texting in this phase see a 15% to 30% increase in acquisition. Two particular use cases have been evaluated in this phase. The first use case is for born digital products such as ridesharing and on-demand services. The average cost for getting a consumer to install an app (CPI) is $2, but once the consumer downloads the app, the dropoff is immense. After 30 days of install, more than 90% of the consumers who installed the app have abandoned it. Brands that added a Text us callout pre-signup on apps saw a 15% increase in acquisition. Consumers are weary of new products and services, and lowering the barrier to entry for them can help increase acquisition. A hypothetical situation where a brand achieves 100 installs in one month would equal a $200 total for installation costs. With 90% of those

6 installs churning, $180 of the money spent resulted in waste. With texting as an option, waste was reduced by $30. Even when compared with other channels, texting resulted in the highest acquisition for new app downloads. One SF-based brand of on-demand service A/B tested texting with phone calls. Adding a phone call option pre-acquisition resulted in a 2% increase in acquisition, 15% lower than texting. With the costs factored in, phone calls actually resulted in a net negative ROI, whereas texting resulted in a new positive ROI. The second use case for texting in this phase is for mobile web experiences. From purchasing tickets, to purchasing products, consumers who were offered a Text us callout converted 10% more often than those without the callout. This is specific to mobile web experiences. Companies such as Intercom have helped increase acquisition for desktop-based experiences, but the experience didn t translate to mobile. Texting, however, is the best experience for customers surfing from mobile devices because they can get quick answers without giving up anything time from work, the ability to multi-task from their phone, etc. TEXTING FOR CONSUMERS IN THE EXPERIENCE PHASE OF THE NPS, CSAT and CES are first offered as a measurement in the Customer Journey at this phase. Brands see up to a 40% reduction in phone calls, a 700% 1400% ROI, and a 10 point NPS score increase from successfully implementing text messaging at this phase. As the first step postpurchase/acquisition/conversion, this phase is where consumers either churn or become advocates. Traditionally, consumers were offered phone and , with web chat and social peppered between brands. Phone calls are incredibly expensive, at $6 each, and they are nearly the longest contact type, at 6 12 minutes on average. Forrester found each Customer Experience point is worth between $15M and $250M, depending on the vertical. Texting increases NPS 10 points. When translated to CX points, that s worth between $150M and $2.5B. Plus, the massive reduction in phone calls results in a massive cost savings for customer service teams. Adding texting to the Experience phase is a winwin for consumers, who are happier, and brands, who save money and increase loyalty. One ride sharing app that uses texting for customer experience focused on rides that resulted in an unhappy rider. By implementing two-way texting for directly communicating with customer service, they improved loyalty, which adds spend efficiency across every department involved marketing, product, and customer service (collectively CX). It should be noted that brands with the ability to track the entire data stream on the customer journey pre- and post-acquisition will see the entirety of positive outcomes by adding texting. The halo effect elevates every touchpoint. teckst.com