July 30, 2008, 12:00 AM

Customer driven

With more pay and perks for reps and better self-service tools, web merchants are investing more heavily in customer service.

A good call center agent who’s courteous, knowledgeable and professional when the pressure is on is hard to find and even harder to keep. That’s why online retailers are working smarter to recruit more qualified agents and motivate their best reps with higher pay, better benefits and more career advancement. To keep pace with increasingly sophisticated Internet shoppers, web merchants also are adding more online self-service tools, handling a higher volume of customer service activity and reducing the time it takes to respond to e-mail messages, according to Internet Retailer’s latest survey.

The survey on customer service finds that retailers are hiring. 59.6% of web merchants expect to add agents this year, including 69.5% that will hire up to five more reps, 13.3% between five and 10 agents, 8.6% from 11 to 25 agents and 8.7% more than 25 reps. To avoid serious employee turnover, which customer service analysts say can run as high as 40% in a typical retail call center, merchants also are hiring more selectively and offering better pay and perks to attract and retain motivated agents.

The survey finds that web retailers are paying their reps an hourly rate that is consistent with call centers in a variety of industries, typically $10 to $20 per hour. 47% of chain retailers, catalog companies, consumer brand manufacturers and web-only merchants taking part in the survey pay reps $10 to $12 per hour; 20%, $12 to $16 per hour; and 18%, $16 to $22 per hour. Only 15% compensate their call center agents at an hourly rate of $10 or less.

Better pay, perks

In addition to a competitive hourly wage, more web retailers are also offering better referral and incentive bonuses, making bigger contributions to 401 (k) and pension programs and paying higher commissions to attract and retain qualified call center employees. Better perks such as flexible time, discounts on merchandise and company social events are other incentives retailers are adding to keep their most productive agents content and on the job.

“The web retailers that are going to turn their customer service center from an average one into a great one are spending the time and money to give motivated reps a clear career path and a chance to advance,” says James Dickie, managing director of CSO Insights, a customer service research and benchmarking firm. “Web-based customer service is becoming highly specialized and retailers won’t keep their shoppers happy if there is a constant turnover of employees in the call center.”

As online shopping volumes go up, e-retailers are handling a heavier load of customer service calls and e-mails. The survey was e-mailed in early July to subscribers of IRNewsLink, the magazine’s e-newsletter, and all responses were collected and analyzed by Vovici Corp., which has partnered with Internet Retailer in a series of surveys of the e-retailing industry.

Of the 192 web-only merchants, chain retailers, catalog companies and consumer brand manufacturers taking part in the research, 50.6% are handling 50 or more calls each day, including 38.2%, more than 100 calls, and 9.6%, more than 1,000. 72.9% of merchants receive at least 50 e-mail messages each day and 21.5% more than 200.

Customer service reps aren’t just juggling more calls and e-mails. They also are handling more diverse types of communication, including live chat. 29.1% of retailers participating in the Internet Retailer survey offer live chat, compared with 22.4% in the previous survey. Of the web retailers offering live chat, 50.9% conduct fewer than 10 chats each day, compared with 26.4% that conduct between 11 and 50 chats, 9.5% from 51 to 250 chats and 13.2% more than 250.

“Web retailers are experiencing bigger volumes of calls, chats and e-mails because more shoppers are coming online to research and purchase products,” says Zachary McGeary, associate analyst who studies customer service and platform support trends for Jupiter Research. “More retailers are adding live chat, especially proactive chats when customers are engaged on the web site, because a direct interactive contact is a great way to instantly resolve a problem or generate a better sales opportunity.”

The survey finds that merchants also are getting faster at responding to e-mail correspondence. In general customer service analysts say an adequate response time to an e-mail message, typically one that requires an agent to research a problem and deliver a detailed reply, ranges from six hours to one day. But 69.3% of the merchants taking part in the Internet Retailer survey say they respond to an e-mail in eight hours or less, including 18.4% that get back to the customer in fewer than 60 minutes.

A faster e-mail response rate is a clear sign that online retailers are hiring more experienced and talented reps and working to improve their customer contact performance, McGeary says. “Customers aren’t going to wait around to get a question answered or a problem resolved,” he says. “A good e-mail response rate means that a retailer is taking customer service seriously and looking to build a long and healthy relationship with shoppers.”

Most online retailers prefer to operate their customer service programs in-house. The survey finds that only 5.6% of merchants outsource their customer contact center to a third party. But whether they do the job internally or contract with an outside call center, web retailers also like constant feedback from their customers and so give customers more self-service tools to research questions, change personal accounts and track merchandise.

The survey finds that 92.3% of retailers offer 24-hour customer service. Web merchants also are providing visitors and shoppers with diverse ways to conduct their service-related business. Of the major self-service tools retailers offer on their web sites, 79.3% provide shoppers with a program to confirm an order, followed by 62% that offer account status or shopping history, 62% with order status, 61.4% with shipment tracking, 58.7% with applications for changing a name, e-mail, address or password, 54.3% with change billing address and 40.2% with estimated ship date.

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