Where to Sink Customer Service Technology Investments in 2017 and Beyond

Bots, cloud, augmented and virtual reality-oh my. A look at the top technologies customer service organizations should invest in for 2017.

Companies that treat customer service as an afterthought are "so 2000 and late" to borrow the lyrics of a Black Eyed Peas song.

In a hyper-connected world where customer growth is increasingly difficult, customer retention is critical. The probability of selling additional products or services to an existing customer is 60 to 70 percent whereas the probability of selling to a new prospect is 5 to 20 percent, according to Marketing Metrics. And a customer is four times more likely to defect to a competitor if the problem is service-related than price- or product-related, reports Bain & Company.

Savvy companies understand that they can no longer get by with minimal investment in customer experience. Here are the technology investments that analysts and industry experts see transforming customer service next year and beyond.

For many companies, a major priority is not to buy more tools and software, but to integrate their existing solutions and create a unified view of the customer. "It's not about building the best integrated suite for one department-companies want to recognize the customer across the organization and solve for a unified customer experience," notes Omar Akhtar, an analyst and managing editor at Altimeter, a Prophet Company.

Ruth Vela, operations manager at Play Telecom, a telecommunications solutions provider, agrees. "We realized we needed to work on integrating the applications we have before we take on more," Vela says. "So we're focusing on business processes and connecting everything to get the input and output we want more efficiently without anyone having to do it manually."

As an example, Vela points to Play Telecom's customer support team. As the support team grew, it brought on more and more tools to handle specific tasks. Eventually, the customer support team needed to connect Zendesk's customer service software with Asana, a project management solution, in addition to integrating them with Salesforce, Slack, and other project management tools used by other teams.

They began by leveraging the APIs that came with each of these cloud solutions but found the integrations to be high maintenance and resource intensive. Play Telecom turned to Azuqua, a company that focuses on custom integrations for cloud and web-based services. Azuqua helped Play Telecom connect many of its systems "within hours" according to Vela, which also highlights an interesting development in the API economy.

As the API economy and the Internet of Things grow, the need for connectivity is creating opportunities for companies like Azuqua to help businesses get up to speed quickly. Indeed, "people don't want to let go of their best-of-breed tools, they just want the right information at the right time and they don't have the patience to wait for IT to do it," says Azuqua CEO Nikhil Hasija.

Customer service agents can only be helpful if they have access to the right information. Therefore, solutions that can help agents quickly filter information from various databases and find what they need are critical, says Jeff Foley, director of product marketing and customer service applications at Pegasystems, a CRM and BPM software provider.

"As the sheer volume of information becomes harder to sift through, automation will be key to filtering that data and using it in a way that makes customer service more efficient," Foley notes.

Real-time speech analytics is one example of this trend. Companies are implementing speech analytics technology that analyzes phone conversations in real time and serves up insights and recommendations for the agent. Real-time speech analytics solutions is "one of the most exciting things happening in today's contact center," says Donna Fluss, president of DMG Consulting. What makes the technology exciting is its ability to identify insights that may not be obvious to the agent, she explains. "For example, the system might identify a caller as an attrition risk and sends the agent an alert with advice on how to proceed."

Virtual assistants and chatbots are also being designed with the promise that they will help companies provide faster and more convenient customer service. And even when the bot can't solve every problem, it most likely will reduce the queue of customers waiting to be served and allows agents to focus on the most pressing issues. Indeed, it's crucial that customer service is fast and convenient, Foley observes.

If a customer isn't able to resolve an issue through self-service, then an agent should be able to provide help "at any point along the journey-already knowing the steps that have been taken by the customer to make the conversation efficient and fast," he says.

Social Media Matures
Research shows that consumers increasingly use social media as a customer service channel and expect fast responses from brands that they communicate with. The number of social messages sent to brands has been rising steadily, from 1,790 per social account in 2013 to 2,742 to date, according to Sprout Social. Brands, however, only answer about one in 10 messages.

And while brands have invested in social listening tools and have people monitoring their accounts, many still struggle to keep up with customer expectations. Simply put, brands need to take their social strategies to the next level. A mature strategy, for instance, takes a cross-functional approach to social media. Instead of treating social media as a siloed channel, brands should integrate it across the organization including input from marketing, sales, customer service, and other teams.

However, encouraging various departments to co-own social media takes time, notes Andrew Caravella, marketing vice president at Sprout Social. "Make no mistake, there will be hesitation to fully invest in a cross-functional approach," Caravella writes in a Forbes column. "Address these concerns head on and think about comprehensive social management by identifying the most practical and cost-effective starting point, developing training protocol, implementing shared responsibilities and creating a necessary feedback loop."

Another way to grow your social strategy is to think of it in terms of "peer-to-peer customer service" says Robert Wollan, senior managing director of advanced customer strategy at Accenture Strategy. "There's a lot of interest in community-based services where you have dedicated customers who want to help other customers and if done well, customers don't even need to call your contact center," Wollan says.

However, building a community of advocates is a long-term commitment, Wollan adds. In addition to investing in social listening and analytics as well as a platform to support the community, companies shouldn't pursue this idea unless it's committed to finding engaged customers and supporting them. "This isn't something you can turn on and off arbitrarily," Wollan warns. "But the companies that invest adequate time and resources to community-based services often find it pays off."

Augmented and Virtual Reality
While augmented and virtual reality are still nascent technologies, they already have the potential to transform customer experiences. We already see this in play, like at Marriott Hotels, which offers VR headsets at some of its hotels to show guests other destinations to consider for their next trip. And The Home Depot offers an app that lets users see how 3D images of products like doors and patio furniture would look in the real world using their phones' cameras.

Virtual reality and augmented reality can also play roles in customer service, Wollan maintains. "Forward-looking companies don't look at customer service just in terms of fixing a problem, they see service as a way to help the customer explore ways that the product fits into their lives," he says.

Accenture, for example, recently worked with Fiat Chrysler Automobiles to develop a sales application using augmented reality. Customers can view and interact with a life size, 3D virtual version of the car they are considering to buy using Google's Project Tango technology.

Car buyers hold a tablet, and using the integrated sensor technology, motion tracking, and depth perception from Project Tango, they can move the camera to examine the exterior and interior of the car from all angles. Car buyers can make changes to the upholstery colors or dashboard styles and see how they look with a tap on the screen. Users can also look through the virtual windshield of the car and see the real world around them as if the vehicle was in their actual location.

It isn't a stretch to imagine a customer service agent using similar technology to walk a customer through making a repair or showing him a better way to use a product. Of course, no single technology will fix a company's customer service. The successful companies are the ones that look at the bigger picture and consider how organizational leadership, employee engagement, and investments in the proper tools and resources are all needed to transform the customer experience. As Wollan notes, "Everything is connected."