Capitalize on the New Frontier of Customer Service, with Jay Baer.

Speaker 1:

If you’re going to take the risk of running an agency, shouldn’t you get the benefits to? Welcome to Build a Better Agency where we show you how to build an agency that can scale and grow with better clients, invested employees and best of all, more money to the bottom line. Bringing his 25 plus years of expertise as both an agency owner, an agency consultant to you, please welcome your host, Drew McLellan.

Drew McLellan:

Hey, everybody. Drew McLellan here. Thank you for joining us for another episode of Build a Better Agency. Really excited to be with you today, and really excited about the topic that we’re going to explore with our guest. You all know Jay Baer. Jay is the world’s most retweeted person amongst digital marketers. He’s also renowned business strategist, keynote speaker, and the New York Times bestselling author of five books who travels the globe helping business people get and keep more customers. He’s advised more than 700 companies since 1994, including companies like Caterpillar and Nike, and 32 of the fortune 500 companies.

Most of you probably know him as the founder of Convince & Convert, a strategy consulting firm that helps prominent companies gain and keep more customers through the smart intersection of technology, social media, and customer service. His company’s media division owns the world’s number one content marketing blog, the world’s top marketing podcast, and many other educational resources for business owners and executives that I know many of you tap into on a regular basis. Jay is the creator of five multimillion dollar companies, and he is an active venture capitalist and technology advisor, as well as an avid tequila collector and certified barbecue judge.

And also for your note, Jay’s got a new book coming out March 1st, called Hug Your Haters, and that’s going to be the topic of our conversation today, is Jay’s ideas about how companies and agencies can help companies attack social media and customer service in a whole new way. Jay, welcome to the podcast. Thanks for joining me.

Jay Baer:

Thanks so much, my friend. Great to be here. I thought we were going to talk about tequila and barbecue, but we can talk about customer service. That’s totally fine.

Drew McLellan:

Well, actually it might boost my listenership if we went by tequila and barbecue.

Jay Baer:

It makes for a hell of a good headline. I tell you that.

Drew McLellan:

That’s right. That’s right. So tell us a little bit about the book and your position of customer service and how it’s changing.

Jay Baer:

So, in our consulting practice, we work with lots of big organizations, as you mentioned on digital strategy, social media strategy, content marketing strategy, and related themes. And what I discovered over the last two or three years is that increasingly those conversations and those strategic plans also had a lot to do with customer experience and customer service, because especially in the online world, in the digital world and the places where customer service is a spectator sport, you can’t really put up a hard wall between marketing and customer service. We’re using Twitter for marketing and customer service. We’re using Facebook for marketing and customer service. We’re using email for marketing and customer service. And so it really is becoming much, much more blended together. And so decided to write a book about it and the book became Hug Your Haters, which will be out March 1st. Lots of pre-orders already at hugyourhaters.com and all kinds of special bonus offers.

And we got socks. We got all kinds of crazy stuff, posters for people who ordered the book early. And it was a really, really fun and interesting project. I did a ton of research for the book. In fact, commissioned a huge research project with the guys at Edison Research, where we really examined the science of complaint. We interviewed thousands of Americans. This is no survey monkey off the shelf thing. This is a major research project. And we looked at who complains, where they complained, why they complain and how, and those findings colored the book and the recommendations inside the book.

Drew McLellan:

Sounds awesome. And one of the things that your bio didn’t mention, and I want to make sure the listeners understand is, while you work with a lot of companies, you also do a lot of work with agencies.

Jay Baer:

We do.

Drew McLellan:

And you are essence, an agency yourself. And so I think you’re going to be able to come at this in a way that our listeners can really connect with on a couple levels. But tell us a little bit about how you envision customer service changing based on what you learned.

Jay Baer:

So we found that there’s two main types of complainers, two types of haters in the parlance of the book. The first are offstage haters, and these are the people who complain in private. They complain on the telephone. They complain in email, primarily. They’re slightly older, they’re a little bit less technology savvy, a little bit less likely to use social media. And then there’s a whole different group called onstage haters. And these onstage haters complain in public where there are spectators and they complain in social media. They complain on review sites, Yelp, Tripadvisor, Angie’s List, et cetera. And they complain on discussion boards and forums. And those onstage haters are a little bit younger, a little bit more tech savvy, et cetera. But the demographic difference is really aren’t that significant. What’s significant, Drew, is the expectations of each of these groups.

The offstage haters, the people who complain and what we would consider to be legacy channels, what they really want is an answer approximately 90% of the time. If somebody complains on the phone or email, they anticipate a business to get back to them. And I’m sure that’s true in your own experience and the experience of the listeners. If you call a company, you expect to get a response. If you email a company, you expect to get a response. And most of the time businesses do respond in those channels. We have built businesses to do that. That’s why it’s called a call center in many cases. But conversely, the onstage haters, the digital complainers, if you will, they don’t necessarily want an answer. What they want is an audience. They want their friends in social media say, “That really sucks,” right? They want to have this group empathetic moment.

And in fact, less than 50%, less than half of everybody who complains in a digital environment wants or expects a company to respond, less than half. So here’s an amazing opportunity for businesses that agencies can really take to the table, which is when you do answer, when you answer somebody on Facebook, Twitter, Yelp, Tripadvisor, discussion boards, forums, all of that, you can blow those customers’ minds and steal their hearts. You can have up to a 30% increase in customer advocacy by answering a single customer complaint in an online venue.

Drew McLellan:

Fascinating. Well, and partially, because not only are you answering the customer, but you’re answering their entire audience by [crosstalk 00:06:28].

Jay Baer:

That’s right. You’re showing what you’re made of. You’re showing what you’re made of to everybody out there. And so the recommendations in the book, the hug your haters formulate, if you will, is to answer every complaint in every channel every time. But almost-

Drew McLellan:

Is that all?

Jay Baer:

That’s all. But almost no business does that, big, small, in between almost no business does it. What we actually do is we answer some complaints, some of the time in the channels that we prefer, and that’s no longer going to get it done.

Drew McLellan:

And did your search show, or do you think that over time the expectation will change and that people will expect an answer in all the channels?

Jay Baer:

100%, of course. Sure. Not only will they expect an answer because we… Well, let me tell you the three reasons why that’s true. Let me go at this a different way. One, you have demographics, right? I have two teenage children, 17 and 14. They have smart phones, but that is for them the worst name for a device ever, because of all the functions of that device the only one that they have no interest in is the telephone. I mean, you can’t get my 14-year-old son-

Drew McLellan:

It’s amazing [crosstalk 00:07:32].

Jay Baer:

Yeah. He won’t talk on the phone at bay net point. I mean, he has no interest. And I do not believe that these kids are going to one day wake when they’re out of college or 23 and have their first job and sit there in their cubicle and say, “You know, I’ve been missing out on the wonders of telephonic communication. I’ve missed the boat on this great invention.” I just don’t see that happening. So from a trend standpoint, we’re going to see legacy channels fall off. Then we also have the circumstance and I’m sure this has happened to you, Drew. And I bet you, almost everybody listening this has happened, where you have some complaint and you call or you email and you didn’t get a hold of anybody, or you didn’t like what they told you. So you went to social media, you took it public. You raised the stakes and then magically you got better help. This happened to me a few weeks ago.

And all of a sudden now you’re like, “Wow, Twitter works.” So the next time you have an issue, what are you going to do first? Right. You’re going to just completely not bother with the call, email, letter, face-to-face meeting, because you know that you can cut out that middleman if you take it public. And so over time, we’re training our own customers to do that. And one of the reasons why that’s so is that ironically business is way too slow, not just in social media, that’s almost axiomatic, but we’re also way too slow on phone and email. The average email requires 44 hours to get a response now from business, almost two days. That’s too long.

So what happens all the time is that you send a business an email, they don’t get back to you right away. So you’re like, “Well, these guys aren’t going to get back to me.” And in that 44 hours, now you take it public. You put it on Twitter or Facebook. So what happens is we are taking private complaints and we’re making them public because business is too slow to respond to email and phone.

Drew McLellan:

Yeah. I actually had that exact experience. So, very quickly, I took my daughter and her boyfriend last year for spring break. We went to a sandals resort in Jamaica. And when we landed in Jamaica they told us that they had oversold our resort and had moved us to a couple’s only resort, which is a little weird to do that with your daughter and her boyfriend. So I-

Jay Baer:

They didn’t care about that. They’re like, “Sure you won’t mind.”

Drew McLellan:

No. Right. So I expressed my discontent, got nothing, started tweeting about it while we were on the shuttle to the resort. By the time we got to the resort, the manager met us at the shuttle and fixed it.

Jay Baer:

See. There you go. A living testimony. Now, next time you have a challenge, right, we’re just going to go right to Twitter. Of course.

Drew McLellan:

We’re just going to go right to Twitter. Right. Absolutely. Yeah.

Jay Baer:

We’re training our customers to do this, but yet what’s amazing to me, Drew is that businesses are not set up to do that. Right? They’re set up now to shock and awe customers in social media sometimes, but they’re not at all prepared for what the next wave is, which is, well, what if everybody just tweets first and doesn’t call. And that is, I think, a tremendous opportunity for agencies to go to their clients and say, “Look, what you think of as customer service is no longer true.” Right? That’s why I wrote this book. I tell people that Hug Your Haters is the first ever modern book about customer service, because it talks about this digital wave that’s going to transform customer service in ways that frankly we haven’t seen since the invention of email.

And I think agencies can walk into clients and say, “Look, let’s sit down. Let’s audit which channels you do respond on. Let’s audit how long it takes you to respond. Let’s audit the kind of responses that you’re putting out there in public forums. Let’s make sure you have the right number of resources assigned to online versus offstage haters.” And there’s a lot of potential work there for agencies.

Drew McLellan:

Yeah, that’s for sure. And one of the things I think agencies are looking for is they’re looking for ways to get higher in the food chain, that they’ve dropped down from the C-suite into the marketing manager or whatever. This is an opportunity to move up into the conversation around the C-suite, which is how do we keep the customers we have and keep them happy.

Jay Baer:

It’s amazing to me how much customer experience has become the new buzzword, right? It’s almost taken over from social media. But here’s the challenge with customers’ experience, nobody wants to do it poorly. Nobody says that they do it poorly, although most people do, but when you say, “Okay, well let’s get better at customer experience.” What does that really mean? It’s almost too vague to be defined. And so that’s where I think agencies can really help you say, “Okay, if we want to improve customer experience, what does that mean?” In my estimation, what I talk about in the book and what we talk about in our own consulting practice is, great customer experience means that you manifestly exceed customer expectations in one or more dimensions. You’re either faster than they expect, you’re more personal than they expect, you are more responsive than they expect, the product is better than they expect, et cetera.

There’s got to be some scenario where you’re just way beyond their current expectations. And I think agencies can figure out where that pressure point is, what we would call a talk trigger, that thing that creates word of mouth and say, “Let’s make that the tip of the spear for this particular company’s customer experience effort.”

Drew McLellan:

So you’re saying that the goal would be to Excel at one of those and really knock it out of the park every time and make that your lead offering?

Jay Baer:

That’s right. So for Hug Your Haters, Hug Your Haters says that being more responsive, answering every complaint in every channel every time as I mentioned, being more responsive will exceed customer expectations and can be your lead sled dog in a customer experience initiative.

Drew McLellan:

And do you think after you did your research, do you think that all of your findings are as true for B2B buyers as B2C buyers?

Jay Baer:

If not more so. There’s a huge impact of ratings and reviews and customer conversations in B2B. If you think about sites like Spiceworks and G2 Crowd and all the different forums and discussion boards, it’s such a considered purchase in most cases that people are going to spend more time researching and talking to current customers, and ratifying their own decision making process. So I think there’s an enormous opportunity for B2B there. In fact, we’ve got lots of case studies to that effect in the book from companies like HP and others.

Drew McLellan:

And so from the agency’s perspective, how would you suggest… Let me me back up. What does an agency have to know or be good at before they walk in the door and have this conversation with their client? How do they have to ready themselves? Because-

Jay Baer:

That’s a great question.

Drew McLellan:

… [crosstalk 00:14:04] talked about offline before we started the recording, this is new territory for agencies. This is a part of the client’s business that in many cases, agencies have been kept out of in the past. So how do agencies prepare themselves to jump into this foray?

Jay Baer:

Yeah, it’s a great question. I think it would really help if somebody in the agency has some customer experience, customer service background. We’ve actually brought some people like that onto our own team to be able to backstop some of our recommendations with people who have been in the trenches. It really helps to understand the realities. I think it’s also really important for agencies to understand and be able to make the case that customer service is the new marketing, that this is how customers are making decisions. And that is very much true. And we showed that in the book in a bunch of different ways. And I think it’s also important for agencies to have some measure of research capabilities. And that’s probably true for almost every agency, but you think about things like secret shopper programs or customer surveys to get a handle on a baseline level of support for customer service in the organization. There’s probably in all of these cases, some research piece to it that the agency can and should tackle on behalf of the client.

Drew McLellan:

Okay. And in some cases that would be having a great research partner. It doesn’t necessarily mean they have to have it in house. Right?

Jay Baer:

Of course, that’s right. Just research availability. And some of it is just understanding how customer feedback translates into operations improvements. Right? And say, look… Let me give you an example of story from the book. So there’s a company called Le Pain Quotidien, which is a chain of bakeries. There’s about 220 of them. They’re based in Brussels, Belgium. They have lots of locations in the US, mostly in the northeast. And about 18 months ago or so they hired a woman by the name of Erin Pepper to be their director of customer experience for the brand. And her goal when she was hired was to triple the amount of complaints. Now, think about that. It wasn’t to minimize complaints, it was to get more complaints.

Drew McLellan:

Interesting.

Jay Baer:

Why? Because every time you get a complaint, it tells you something that you don’t know, it tells you something you’re doing poor. Companies don’t need anyone much less an agency to tell them what they’re doing well. They already know that, that’s how they became successful. What they need is somebody to tell them what they’re doing wrong. And that’s why haters are your most important customers. So she finds ways as often as possible to solicit negative feedback from customers. In the in-store experience, there’s lots of different nudges and touch points where it says, “Please leave us a review, go here. Anything we’re doing wrong, let us know.” Very aggressive about soliciting feedback. But it’s what she does when she gets a negative feedback that I think is even more remarkable. So when they get negative reviews on a Yelp or Tripadvisor, Urbanspoon, those kind of sites, she answers them back in public, as you should do, as I recommend in the book. And she does the usual, really sorry, and we’re taking into advisement and thanks so much, and all that.

But then what she does is she waits a couple of hours and then she contacts the hater using some private messaging system and, and all of those sites, including Facebook, et cetera, have some sort of private messaging capabilities. And so she answers them the second time in private and says, “You know, I’ve been thinking, and you are a very perceptive customer. You see things that other people simply do not see. You have a gift for this. And so what I’d like to do with your permission, I’d like to send you two gift cards a month. And with each of those gift cards, I’d like you to visit a different Le Pain Quotidien location. And after you have your breakfast or lunch or dinner, I’d like you to click on this link and fill out this detailed survey of your experiences, because you understand what we’re trying to do here. Your feedback is going to make us better.” And she now has more than 150 of these secret shoppers filling out detailed surveys every month, total cost of this program, gift cards

Drew McLellan:

Right.

Jay Baer:

Now, every agency listening should write that up as a service and go pitch it to all of their clients who have actual public facing customer locations next week.

Drew McLellan:

Yeah, that’s brilliant. It’s an army of secret shoppers, but also an army of people who were saying bad things that are sooner or later are going to turn into advocates probably.

Jay Baer:

She turned hate into help, right?

Drew McLellan:

Yeah.

Jay Baer:

And how much better can you get?

Drew McLellan:

Yeah. Wow. And does she give back to them afterwards and report on things that they’re doing to change what they experienced or?

Jay Baer:

Absolutely. No, that’s a great point. She does do that. That’s a really good point, not just for her program, but I think in general. A lot of agencies and a lot of companies direct feel like, well, we’ve got all this covered because we do surveys. Well, here’s the problem with surveys. A, usually they’re not well designed. B, where does that information go internally? Usually one person or a small group in the business intelligence unit or something else gets access to the data. And it’s not socialized across the whole organization, which really minimizes its impact and its usefulness. And C is that it never comes back to the customer, right? The customer gives feedback into the black hole and they’re like, “Well, I guess they’re listening.”

But really what you want to do is find a way to then answer those customers back via email in most cases, or it could be other forms and say, “Look, hey, thanks very much. This was great. And here’s some things that we’re doing well because of customer feedback.” Again, that’s another service an agency could provide, which is, let’s figure out how to get more customer feedback and then let’s figure out a way to make sure that customers are informed about what that feedback means.

Drew McLellan:

Yeah. At AMI we do client satisfaction surveys for agencies, but one of my deals is I won’t do it unless they agree that they will send a letter to all the participants after the survey is done saying, “Here’s what we learned and here’s what we’re changing or what we’re doing different,” blah, blah, blah, blah, that they don’t close the circle because otherwise people feel like, okay, I just took all this time to tell you all this stuff, and it feels like, as you said, it goes into a black hole.

Jay Baer:

Yeah, yeah. The other service that I think agencies can really perform well in this Hug Your Haters environment is what we call in my company, the honesty audit. An honesty audit is where you take a cross section of actual responses across all channels. So you might take 50 or 100 phone call transcripts, you might take 50 or 100 email responses, social media responses, review site responses if they’re answering there. All the places that the company is active and you actually grab a cross section of what the company says and really look at it and say, okay, is this the right way to handle this customer in this scenario? Is what we’re saying factual? Is what we’re saying comprehensive? Are we actually answering customers problems or are we just kicking the can down the curb? For example, in many cases you see in social media, “We’re really sorry. Please call us to solve this.”

Well, they probably already called. They called first and they didn’t like the answer, went to Twitter. And now you’re saying call us, which is a maddening set of circumstances for the customers. So that kind of honesty audit can be really, really illustrative because almost nobody, unless you have a director of customer experience, almost nobody in any client does that. Says, “Look, let me look at all of the customer interactions across all channels and then categorize it and sort it and look at it and make sure we’re as good as we can be.” And this is most egregious in social media. How many times have you heard this, Drew, or seen this where companies and some agencies, if not most agencies, what they do is they take the youngest least experienced people in the entire company and say, “Guess what? You’re in charge of social media because you “grew up with this stuff.”

So now you have somebody in a real time public environment being the face of your brand, who has the least amount of experience in business, in life and in your company. And I got to tell you, it is way easier to teach somebody Twitter than it is to teach them entire company. So agencies can also help in right sizing the staffing pattern, and the triage and handoff and how do customer questions actually get answered.

Drew McLellan:

Well, and that leads me to a question. A lot of agencies rustle back when social was hot and new and clients didn’t know how to do social, a lot of agencies instead of teaching clients how to do social were doing social for them.

Jay Baer:

True. “We’ll tweet 10 times a week for 5,000 bucks.” Yeah.

Drew McLellan:

Right. Right. So in terms of this new wave of the combination of digital and customer service, where should the agency draw the line in terms of their role? So is it in your opinion ever appropriate for an agency to be manning the phone, if you will, the digital social media phone and answering customers? Or is that something where they need to create protocols and best practices inside the client and have the client do it?

Jay Baer:

It really depends on the company, and what kind of company it is, and the breadth of customer inquiry that you could get. And it also certainly depends on the agency-client relationship, and how close knit that is. How much does the agency really understand the client’s business? Of course, all agencies say they do, but in many cases they don’t, and that’s… I’m not speaking tales out of school. That’s just the reality of the business. And so I think it can work certainly for businesses that aren’t as real time and the customer expectations aren’t as much real time. I think it absolutely can work. But I will tell you, I feel the same way about agencies handling social media, customer service, as I do about agencies handling social media marketing, is that, yeah, you can do it, but there’s no future in it. Right?

There’s no real money in it, unless you can do it at massive scale like somebody like VaynerMedia, who’s doing it for a hundred massive brands. Unless you can do that, it’s such an arbitrage play, right? You’re going to take your least expensive people. You’re going to say, you’re in charge of Twitter and Facebook for this client. And you’re going to charge the client somewhat more per hour than you’re paying those people. And can you make a little scratch on that? Yeah. But somebody else is always going to in and say, we can do it cheaper. It really is a race to the bottom. And while I totally understand many agencies do those services. In fact, many of our clients of agency clients that we work with do those services, I don’t think it’s a smart long term play. Because I don’t think you’re ever going to make any money at it.

Drew McLellan:

Well, and the other reason why I don’t think it’s a brilliant plan on the agency’s part is it forces the interaction at the social level to be superficial because I don’t care how in bed you are with your client, you cannot speak like they speak, you can’t really offer up a solution the way they could. And so I think it minimizes the opportunity to actually connect with the customer. For the client, we’re getting in the way I think.

Jay Baer:

And if you have to ask the client what to say, then you’re just slowing down the train at that point.

Drew McLellan:

Right. Right. So how do you recommend that agencies, first of all, how open do you think companies are going to be to this? Are they ready to hear this?

Jay Baer:

Well, if they were ready to hear it, I wouldn’t write a book about it. There wouldn’t be much of a book in that. So they’re not fully ready, but they will be the same way they weren’t fully ready to hear the story in my last book, but they are now, or the book before that, for that matter. So this is happening, right? Walker Information, great research organization says that by 2020 customers will use customer experience more than price when making shopping decisions. Right?

Drew McLellan:

Sure.

Jay Baer:

That’s four years off. And so this is on the right side of history, for sure. Not every client is going to be ready to hear this. Most clients are going to say, “Yeah, we answer the phone. And we answer emails and an occasional Twitter interaction, and so we got this covered.” Let me put it this way, let me mathematically frame this up. 80%, eight-zero percent of companies say that they deliver superior customer service. 8% of their customers agree. So if you ask every company in the history of companies, “Hey, do you guys do great customer service?” They all say yes, because nobody thinks they do bad customer service. But the reality is they have no idea if their customer service is good, which is why the honesty audit is so important. They have no idea. They just assume that they have good customer service because they still keep making money. But eventually it’s going to come back to bite them.

So the way you address this and the way you get hired to do this, I think, is to show examples of circumstances either where the company is not answering a customer who plainly is in need, or is answering the customer in a way that is way out of bounds and/or circumstances where competitors are answering either better, faster, more comprehensively than your client is. That typically gets the conversation started.

Drew McLellan:

Well, and I think you’re right. First of all, I think people are already making buying decisions based on the experience over money, over price. But I think it’s only going to get more true as I believe the greatest scarce resource today for most consumers is time. And so if I can have a really great experience and they don’t get it wrong and they fix it, if they get it wrong, yep, that’s worth a couple extra bucks, I think is where we’re headed.

Jay Baer:

No doubt. And I think there’s another opportunity which is dealt with in the book and the next phase of customer service that agencies can really help with, which is community based and self-service. And so there’s some fascinating research. We didn’t conduct this part, but we pulled it in from other sources that says that when customers are able to answer their own question they actually feel better about the company than when they have the company answer a question. And it’s also super, super efficient to do that. So how can you find a way to let the customers of the company answer one another, a support based customer community, a very, very detailed FAQ, all of those kind of things where you’re using readily available information online to help customers access and solve their own problems is a real opportunity for lots of businesses, if not all businesses. And I think there’s a real role for agencies in that too.

Drew McLellan:

Well, again, you would think that that would be huge on the B2B side.

Jay Baer:

Lots of questions that require detailed answers and the kind of questions that probably get asked over and over too.

Drew McLellan:

Well, and I think also, probably a… And I’d like to hear it from the horse’s mouth of somebody who’s using it versus the sales guy that I’m talking to for this multimillion dollar fill in the blank.

Jay Baer:

Yeah. May not be an honest broker.

Drew McLellan:

Yeah. Right. Yeah. So where are the danger zones? Where do agencies need to be careful in all of this? What are the risks to them as they approach their clients about all of this?

Jay Baer:

If the company has an existing “customer service department,” I think you have to tread lightly because at some level, if you’re going to come in and talk about this, you’re saying that your baby is ugly. You’re saying that your existing customer service department, which is staffed with people and resources and “experts” is not good enough. And so that’s a little bit of a danger. I think the other obstacle is, as we just talked about, most companies, in fact, the preponderance of companies think they’re good at this already. And so it’s hard to say, “Hey, you guys are way worse at this than you think.” That’s a little bit of an awkward start to a conversation, so that’s a little bit challenging. I think the other risk for agencies is in getting too involved at the day-to-day tactical level.

Obviously, as we just talked about it, I don’t think there’s a lot of money in that, but also if you’re going to be the guys on the front lines, that puts you in a pretty serious scenario in terms of risk and responsiveness and having to answer Facebook posts at 2:00 in the morning, and to do this right requires real vigilance. And most agencies simply aren’t set up to do that nor do I think it’s really worth the risk.

Drew McLellan:

Yeah. So I’m assuming that you guys are further down the road in this. And so how do you recommend? The customer service department reminds me a little of when websites were the new thing, and we had to deal with the internal IT department. Remember? And so there was that constant, your baby is ugly and we can do it better. And the sabotaging that went on because they didn’t want their boss to think that the agency was smarter than them and all of that. So how have you won over a customer service department? How does one do that?

Jay Baer:

It’s all about resources and resource allocation. Here’s one of the most amazing stats in the book. Each year globally, we spend approximately $500 billion on marketing and we spend $9 billion on customer service. Now, that’s despite the fact that everybody knows from maybe the first three hours that you’re in business, that it makes more sense to keep the customers you’ve already earned than to constantly have to go out and get more customers. Everybody knows that to be true, right? I mean, no one’s going to argue that point, but yet we don’t manage businesses that way, we don’t allocate resources that way. And I’ve discovered that every single customer service manager, director, VP, frontline person, guy on the phones, every single one of them believes that they could do so much better for the customers if they just had some more resources. So I think what the agency does is says, “Look, I know that you guys are having real trouble getting enough resources to do the job that you want to do. We’re going to come in as a strategic council to this company and we’re going to get you the resources we need. But the only way that’s going to work is if we can do this together.”

So you co-opt the customer service guy to be your greatest internal champion because they don’t have the ear of the C-suite the way the agency can. Customer service is marginalized in so many companies, right? It’s just an appendage. It’s a necessary evil. And the agency can say, “Look, these guys are not a necessary evil, these guys are your best marketers,” right? If you’re not good at customer service, then every dollar you spend in marketing is in peril. And so agencies got to come in and be able to make that point and say, “Look, this is no longer unimportant. In fact, it’s the most important.”

Drew McLellan:

Yeah. Yeah. Well, and again, I think it’s also a way as dollars shift around inside the company for an agency to continue to make money, profit from that. And I think one of the things that agencies are seeing and are being pressured to do is demonstrate value. And so if you can increase customer retention and customer satisfaction, that’s very tangible value that you can point to.

Jay Baer:

Yeah. And it’s all manurable, right? So I talk a lot about metrics in the book and the idea that has been used in customer service for years, things like handle time and how many calls did we manage per hour. Those all incentivize the wrong thing, which is to get the customer off the phone as quickly as possible. So instead we recommend using pre and post net promoter score research and say, okay, before somebody complained or right when they called on a scale of zero to nine, how much would you recommend this company? Then you answer their question or handle their problem, and now you re-survey them on that promoter score. And then you use that lift as a way to demonstrate the efficacy of these kind of programs.

Drew McLellan:

Right. Right. And I would also assume that with today’s data, you can also track spending post problem.

Jay Baer:

Absolutely.

Drew McLellan:

And see if A, it holds at, or B ideally it increases because now you’ve proven that to them that you’re trustworthy enough that even when there’s something broken, you’ll fix it.

Jay Baer:

Yeah. I’m glad you mentioned that, because at some level this is a software play too. I mean, most of the companies that we worked with either in our own organization or that we talked to for the book and I did something like 70 interviews for this book, they have some software and in many cases they’ve gotten multiple pieces of software, but they don’t have omnichannel softwares. They might have some social media stuff and then they have some call center stuff, but they’re not the same. They don’t talk to one another. And so there’s a real problem with the left hand and the right hand being coordinated in terms of online versus offline customer support. And that makes it really hard to track true lifetime customer value. And so for agencies that get into this and get a little farther along, I think there’s definitely a role for the agency to play in terms of auditing and recommending better software and better data practices to be able to stitch this together horizontally across the enterprise.

Drew McLellan:

And are there software solutions that you guys there are leveraging?

Jay Baer:

There are.

Drew McLellan:

So tell us about some of those.

Jay Baer:

There are. More and more are coming out because it’s such a common problem. Right?

Drew McLellan:

Right.

Jay Baer:

So HP has got a really good suite to do this. Clarabridge is one of the companies that we work with pretty closely in that area. There’s a great company called Aspect Software that focuses on this kind of work. And then you’ve got companies who started in social, who are starting to move into the offline environment as well. Companies like Sprinklr. So you’re going to see a huge amount of moves in the software, customer to customer service software game in the next 18 months or so. Conversocial is another one that’s really focused on online support, but it’s really at the bleeding edge. Conversocial is doing stuff with WhatsApp customer service, and WeChat customer service, and Snapchat customer service. It’s pretty interesting stuff.

Drew McLellan:

And the companies that you mentioned, are those at a price point that a small to midsize company could afford them, or are they at the enterprise level still?

Jay Baer:

Primarily the enterprise level, but on small and middle sides, you’ve got companies like Yext, which is a really great choice. Likeable Media is really good. There’s a number of them that are starting to get into it. It’s sometimes hard at the low price point to get the offline and online together because the offline stuff pretty much requires some fairly serious horsepower because to do it right, what you really want is call transcription and being able to pick out patterns. So you take 100 calls and it listens to all them, then transcribes it, and then does a word cloud of those calls, those kind of things. And so that’s really important, but it’s not an insignificant level of computing power to make that happen.

Drew McLellan:

Yeah. Yeah. Well, and obviously the technology will continue to advance as the demand does. Yeah.

Jay Baer:

Oh yeah. Yeah.

Drew McLellan:

Yeah. So for an agency who is inspired to think about this, and would you suggest that this is an easier sell into an existing client where you already have a relationship or is this where you would open a door with a new client?

Jay Baer:

It’s a super good question. And I think I’m not going to give you the answer you want, because I think it depends on how you are viewed by your existing client. So on one hand, I can make the case, and I’ve certainly seen this work that the agency has some measure of trust with the client. So they say, “Look, we’re helping you with your marketing, your public relations, your whatever, we can also help you keep the customers that we’re working so hard to earn on this other side, let us help you get better at customer experience, customer service by doing an honesty audit followed by blank, blank, blank.” I see that it works. It can work. However, in some cases you are known and believed to be the marketing guys, the advertising guys, the PR guys that to then say, “Hey, we do this other thing that actually is really similar to the thing we’re already doing. You just don’t know it yet. You’re just so pigeon hold.” They’re like, “Yeah, whatever.” Right?

Drew McLellan:

Right.

Jay Baer:

It reminds me of when traditional agencies first started offering digital, and for a long time, digital agencies took most of that revenue because clients didn’t believe that their previous offline agency could handle it. That’s changed a tremendous amount in the last eight years. But for a while it was hard for traditional agencies to make the case so they could actually do it. I see some of that now with this kind of work. It just really depends on how you’re perceived inside the organization.

Drew McLellan:

Yeah. So I agree. I think you’re right. I think it’s about the relationship. On the new client side though, now you’re really going in and saying, “Hey, stranger, your baby is ugly.”

Jay Baer:

Yep. Absolutely. Absolutely. But I think it’s easier. I think ironically, it’s easier to do that when you don’t have a relationship, right? Because you don’t have the personal skin in the game yet. You don’t know the people that you’re saying are doing less than a perfect job. It a company talking to a company, not, “Hey, we know Julie in customer service and we got to have this conversation about Julie and her team not doing as good as they can do.” That makes it a little bit more fraught with peril. So I think it’s a great door opener. I really do.

Drew McLellan:

Yeah. Well, and I think if you go in talking about the most important marketing you do is keeping the customers you already have. And if you go in with that sort of mantra, I think you can at least start a conversation.

Jay Baer:

Yeah. Well, and I think the way you get out that, Drew is you say, “Look, you don’t really care about marketing.” Nobody really cares about… What they care about is money. And the easiest way to make money is to stop churning customers. Period. I mean, period. There is no second sentence to that. That is the sentence. If you want to make more money, stop losing customers, let’s start there. Let’s fix the leaky bucket, then do marketing.

Drew McLellan:

Right. Right. So how would you recommend agencies package and price this kind of work? How would you approach that?

Jay Baer:

So I think what you want to have is an audit piece upfront, right? So a research strategy program that looks at what they’re doing, looks at competitors and does some examination of shortcomings and some recommendations of what should be fixed. Then an operational piece in the middle, which is okay, let’s help you over a period of time put these things into place. And that might be resourcing and staffing. It might be ways to answer questions, help with some actual scripting. It might be software research and ID. It might be training and tabletop exercises with actual frontline responders, et cetera, et cetera. And then you probably have released the way we sell it, is then you’d have a third phase, which is we’re going to get together on a every couple weeks basis. And we’re going to talk about what’s going on and we’re going to make sure we’re doing survey work of customers to prove that this works, and an ongoing retainer based advice and council strategic rudder holding piece of this to make sure that this is actually getting put into practice.

And so I think it’s a strategy piece, an operations piece, and then an ongoing support piece.

Drew McLellan:

And does the ongoing support piece include going back and retooling and relaunching research at a certain points in time to again, measure success?

Jay Baer:

Yeah. I think that’s the best possible scenario. Absolutely. Not everybody is going to buy that, of course, because then everybody believes in research or wants to fund it or wants to fund good research. You know that good research ain’t cheap, but that is definitely the way it should be handled.

Drew McLellan:

Yeah. Awesome. So, okay, I could chat with you about this for much longer, but I want to be mindful of both your time and the listeners. So in wrapping this up, if an agency owner has… If we’ve peaked their interest today and they’re thinking yep, I got to get smarter about this and this is something we need to be starting to talk to either clients about or prospects about, other than going to hugyourhaters.com, right? That’s the URL? Yes?

Jay Baer:

It is. And the book comes out March 1st, but we’ve got a special deal at hugyourhaters.com, where if you pre-order the book for me at the website, very competitive pricing, it’s 20 bucks a book or less, there’s all kinds of bonus stuff. As I mentioned, there’s webinars with me, conference calls with me, there’s socks, there’s all kinds of other crazy stuff, videos, courses. But if you pre-order the book, you get instant digital access to the book. So even though the book signed out until March 1st, if you buy the book from me now you get the preview copy, the book electronically weeks before it’s actually out, which is pretty cool.

Drew McLellan:

That is awesome. Okay, so not only do they get the book and all of the other fascinating learning pieces, but they get the socks. Right?

Jay Baer:

You get socks. I think, I can’t remember if it’s three or seven copies that you get socks. So the socks are awesome. It says, I Love Haters. They’re pretty fantastic. So I would buy some copies for your team and maybe for your clients.

Drew McLellan:

Sure. And then you could wear your socks into meetings, throw your feet up on the desk and then have a conversation about customer service. Right.

Jay Baer:

And say just this. That’s right. I love it.

Drew McLellan:

So beyond your resources, how else would you recommend an agency get started around this? How can they get their toe in the water in this arena? Because I think you’re right. I think it’s a huge opportunity for agencies.

Jay Baer:

So I would sit down with your own team and do a little mini audit just on your own time of your existing clients and say, “Okay, we probably think all of our clients are good at customer service too. Don’t we?” And everybody will nod their head and say, “Let’s go find out if they are,” and go poke around and maybe do some secret shopper work of your own just on your own dime and see how your existing clients are doing at customer service. And I guarantee you, you’re going to find three or four that aren’t nearly as good as you think, and they’re not really as good as they think. And those are your first opportunities. Second step would be to sit down with your team and sketch out in a bullet point fashion, okay, if we’re going to do an honesty audit, if we’re going to do looking at our current clients in a real way plus their competitors, what would that look like and what would we charge them? So that you can walk in to an initial meeting with some sort of an idea of what a service might look like.

Drew McLellan:

Yeah, that is awesome. As I knew it would be, this has been packed with things to think about and new opportunities for agencies. So I cannot tell you how grateful I am for your time. Thank you for spending the time with us and for sharing so freely all that you know, and you’ve been doing that for decades.

Jay Baer:

Thank you.

Drew McLellan:

So certainly appreciate it.

Jay Baer:

My pleasure. And I should say that if there’s agencies out there, as you mentioned, we work with a lot of agencies. We have 10 or 12 agencies that we work with on a regular basis every day, literally. If there’s any interesting owners out there that are interested in getting into this and just want to have conversations about it, if we can help you get there, just give me a call or an email, just go to convinceandconvert.com and send me a note and we’d be happy to talk to you about it.

Drew McLellan:

Great. And folks can find you basically everywhere on the web, right? Twitter, Facebook.

Jay Baer:

Yeah. It’s pretty easy to find me. convinceandconvert.com is our main site. It has our award-winning blog, 10 blog posts a week. We’re now doing as of this month, seven weekly podcasts and a daily email. So we got lots of resources for folks out there.

Drew McLellan:

Yeah. Yeah. And the podcasts are fabulous, so people need to-

Jay Baer:

Thank you.

Drew McLellan:

It’s not on your radar screen folks. It needs to be. So Jay, thank you very much for your time. I appreciate it very much.

Jay Baer:

My pleasure.

Drew McLellan:

Okay. Everybody that wraps up this episode of Build a Better Agency. Thanks for joining us. If you’re finding it valuable, please make sure you subscribe so you don’t miss an episode. And as always, if you have questions for me or want to follow up, you could reach me at [email protected] or Twitter, Facebook, or any of the other places out on the inter web. Talk to you soon. And I will see you next week. Thanks.

Speaker 1:

That’s all for this episode of Build a Better Agency. Be sure to visit agencymanagementinstitute.com to learn more about our workshops and other ways we serve small to mid-sized agencies. While you’re there, sign up for our e-newsletter, grab our free ebook and check out the blog, growing a bigger, better agency that makes more money, attracts bigger clients, and doesn’t consume your life as possible here on Build a Better Agency.