Two Models for Customer Support

Let’s face it: Customer support isn’t sexy. No one ever made history by inventing a new type of customer support. But some of our recent work shows that customer support can have an enormous impact on customers – not just their satisfaction but ultimately on their willingness to purchase or renew an information service. In several of our win-loss analyses for clients, the main driver of customer losses was poor support, resulting in either unneeded customer frustration when using the product or lack of usage altogether, despite an obvious need for the product.
Vendor commitment to support is sometimes undermined by our burgeoning self-service world in which products are engineered so that users can purchase and use them with minimal vendor intervention. The need for support is increasingly viewed as a product defect. Vendors push users toward a variety of self-help tools rather than live support. Much of this self-service approach is positive, offering users faster access to solutions and lowering vendors’ support costs.
However, support remains critical because information products are intangible. The content, applications, and services represented by an information product have value only inasmuch as they help a user accomplish a specific set of tasks. A user’s success with a product often depends not just on the inherent strengths of the product itself, but also on the accompanying support that enables a user to get the most out of the product.
Against these two conflicting realities, we see vendors adopting one of two support models:

  1. The Necessary Evil Model: For many vendors, support is an obligation to be handled as cheaply as possible within acceptable limits. PC hardware manufacturers are notorious for seeking to troubleshoot customer problems quickly and limiting help by categorizing the user’s problem as outside the scope of hardware support. Many information companies also confine their support to relatively low-level operational questions. In our research, one of the fundamental mistakes of support groups is to assume that a quiet customer is a satisfied customer; constant outreach is critical in ensuring that customers are engaged with the product.
  2. The Value-Added Model: Some information companies, particularly those serving business and professional users, see customer support as an opportunity to enhance their customers’ experience. These vendors typically have a variety of levels of support, enabling users to get consultative advice on how to use the product most effectively. For example, at LexisNexis and WestLaw, high-quality support is integral to the product, and is staffed by lawyers who can help users set up complex searches among the vendors’ many databases. Similarly, FactSet’s customer support group is key to helping its customers use FactSet’s warehouse of databases and development tools to create custom financial analyses. The company has built a $641 million business with a 90% renewal rate using relatively few salespeople but many, customer-focused support people. Another example is BizFilings, which helps new companies with their corporate or LLC formations and filings. In this highly-competitive business, BizFilings has distinguished itself by providing a high level of hand-holding and consultative support alongside of its packaged offerings.

There is no “best” support model. Support must conform to the needs of each product and the customers it serves. Either way, support should be treated as a critical part of every vendor’s strategic plan.

About Lee Greenhouse

Longtime strategy consultant focused on the business of information content, applications, and services.
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