Filed in Cloud Industry Insights by Simit Patel | December 5, 2011 10:59 am
Rackspace knows cloud hosting is a service business. Each client is running a unique operation with very different cloud needs, which will adapt over time based on how the client’s operations change. It is from this perspective the promise to provide clients with Fanatical Support is made.
Of course, cloud hosting isn’t the only business in which service is paramount. To illustrate, here’s a look at 10 of the top-rated companies in the world — and what would happen without their commitment to customer service.
The world’s most valuable company might also be one of the world’s most service-oriented, as illustrated by the Genius Bar incorporated into each retail Apple store. Apple’s commitment to service led the company to invest heavily in a retail presence, so that customers could access support from the same place they shop at. This bold move paid off handsomely for Apple and its customers, as its growing market share and surge to becoming the most valuable company in the world after the introduction of retail Apple stores illustrates.
Without the Genius Bar and a customer-centric design philosophy, we’d have poorly designed, ugly computers that are too tough to use — and Apple itself wouldn’t be the revolutionary force it’s become.
Virgin is a business that has proven its ability to enter completely unrelated fields — everything from soft drinks to airlines — by focusing primarily on customer service and experience. ”We deliver the Virgin magic by creating an overall customer experience rather than simply selling a product,” said Richard Branson in a column he penned for Entrepreneur magazine. Specifically, Virgin’s brand values are providing good value for money and providing the ideal customer experience.
Without this customer-centric mentality, its airline would be a whole lot more boring, without attention to a comfortable experience with computer amenities for workers — while operating at the same or even greater cost.
UPS’ relentless focus on customer service has enabled the firm to earn the trust of its customers most important shipping obligations. Thanks to its online tracking service, call centers, uniformed staff, and responsiveness on social networks like Twitter, UPS can always be in touch with the customer — thus providing a level of service much higher than what you probably get from your local Post Office (which, depending on where you live, might be going broke).
Take away the focus on customer service, and UPS might become a bit more like your local Post Office — offering an experience that is slow and disconnected (meaning senders and recipients alike may not have the option of tracking the package at all times, experiencing greater anxiety) and thus difficult to trust. As shippers of information, Rackspace understand UPS’ strategy; speed and constant customer contact ensure a reliable service that provides customers with the trust and value they need to meet their shipping needs.
Nordstrom’s customer service goes well above and beyond the call of duty, and has even led to a sort of folklore developing around the company. Consider, for instance, this story that has found its way around the web:
“One legendary story is the ‘tire chains’ story. A man walked into Nordstrom and insisted that he purchased a used set of tire chains there. Without hesitation, the Nordstrom clerk refunded the person’s money out of her own pocket, even though the receipt clearly indicated another store. Then, on her lunch hour, she took the receipt and tire chains to the store where they were from and got her money back.”
Though it may seem foolish for a company to cater to unscrupulous customers, consider the word of mouth advantage — as this blog entry itself illustrates!
Absent this type of service, Nordstrom customers would be less loyal, less satisfied, and not enthusiastic to the point of evangelizing the company.
Onstar is a company whose situation and strategy is one closely identified with that of Rackspace. They provide award-winning customer service to customers at mission-critical times — when customers are lost, and potentially at great risk and psychological stress. As such, Onstar focuses on providing 24/7/365 support, with the promise of having a person you can talk to right away — not an automated teller system. They know that in their business, providing constant contact with customers is essential. At Rackspace, the story is the same; customers are at great risk and stress if they are disconnected from their information systems, and the reason support is available 24/7/365 to manage that risk.
When it comes to customer responsiveness, it’s tough to beat Trader Joe’s. A report of Trader Joe’s customer service by Fast Company showed that the company’s focus on letting its employees make decisions and respond to customer needs was their secret, observing that store supervisors spend most of their day on the retail floor were provided with a lot of autonomy to set up their stores to meet local needs — while employees can open any product a customer wants to taste and are encouraged both to recommend products they like and to be honest about items they don’t.
Without this type of customer responsiveness, Trader Joe’s might be Trader Slows.
Car manufacturer Lexus has repeatedly reaped praise for its customer service; consumer review group J.D. Power and Associates conducted a study in which Lexus earned the highest marks regarding the level of satisfaction of customers “who visit a service department for maintenance or repair work” within the first three years of owning a vehicle.
Without customer support, Lexus would not have the customer satisfaction and trust from it’s customers to have built their world recognized and respected brand.
Online retailer Zappos has made a name for itself by combining weirdness, family values, and outstanding customer service; the company even dedicates a sizable, prominent portion of its website toward explaining its culture and values to its customers. All of this results in a degree of trust that yields satisfied, repeat customers.
If the company removed its customer service component — but kept its weirdness and family values — it would be more like a creepy uncle at Thanksgiving dinner than a retailer with legions of customers that keep coming back, telling their friends along the way.
A 2010 report conducted by Business Week in its search great customer service companies listed Four Seasons as one of the best service organizations in the world. The reason? The company focused on developing a cross-functional staff; for instance, employees were trained not only in managing the front desk but also in understanding amenities like spa work. Basically, Four Seasons focused on turning its employees into real-life versions of MacGyver!
Without this type of customer service, the Four Seasons experience would likely be more boring and likely frustrating.
A Harvard Business Review study seeking to explore the secret to Best Buy’s success — and why it has displaced other electronics retailers like Circuit City — concluded that the primary factor was the company’s focus on creating a customer-centric enterprise. From the study:
Best Buy took the time to understand who its customers are and what they need and then started selling solutions instead of products. As part of its research, for example, Best Buy discovered that 55 percent of its customers were women, and that for the most part they loathed their shopping experience at the retailer. Men look for a specific product at a discount price. Women want not just a digital camera, but a printer, cable, and other accessories–and they care far more about these things than price. Equally important, they want help with installation, while most men prefer to try to put things together themselves.
Taking the time to understand their customers, and building them personalized solutions, is a formula that yielded success for Best Buy — and is a formula that Rackspace is familiar with via the Managed Cloud offering. Take out the customer service and the customer-centric mindset of the entire enterprise, and you’re left with a company that sells products instead of solutions.
As these companies illustrate, quality customer service is in many ways the ultimate win-win, as it generates long-term relationships between customers and service providers. And it is this belief that guides the Rackspace team.
Simit Patel is a trader, writer, and technology entrepreneur. Simit blogs via Contently.com. This is a guest post and the opinions of the author may not reflect those of Rackspace.
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