Gartner Information Technology Research

COVID-19: Take Immediate Action to Help Customers

Published: 30 March 2020

ID: G00722712

Analyst(s): Kristin Moyer, Hung LeHong, Rui Zhang

Summary

Your customers are panicked, or if not that, they are stressed. Executive leaders and their teams can help, now. Don’t ignore “old” technologies like email, websites and mobile apps during this time of crisis. Even picking up the phone and calling valuable customers can be game-changing.

Overview

Key Findings
  • COVID-19 and economic shock are a defining moment for you as an executive leader. Customers will remember how you help them, or fail to help them, for years to come.

  • Gartner analysis reveals that 71% of even the most digitally advanced companies are not helping customers with their most pressing questions and problems.

  • Helping customers is not just the right thing to do. It improves customers retention, which mitigates revenue loss.

Recommendations

Executive leaders focused on digital business transformation should help customers deal with the COVID-19 economic shock and recovery by taking the following actions:

  • Remove friction for customers by providing “how we can help you” options and eliminating reasonable gotchas, like waiving airline change fees.

  • Provide advice to customers by reaching out to the most valuable with personalized advice and orchestrating proactive action, like custom logistics services.

  • Identify new ways to help customers each week. What was market leading last week (waiving fees) is now basic and expected.

  • Decide what becomes permanent postcrisis. For example, retain digital options like online yoga and continue sending “how we can help you” emails to customers who opt in.

Analysis

COVID-19 is the first global humanitarian and economic crisis for which digital can be used to scale a response. We did an analysis of how the most advanced digital companies we know of are handling COVID-19 with their customers as of 11 March 2020 (see Appendix section for the methodology and list of companies). We evaluated four things that require digital technologies and competencies. Has the company:

The results of our analysis are stunning. Even for the most digital companies in the world, 71% are taking no action to provide COVID-19 advice or remove friction for customers (see Figure 1). Instead, they are telling customers about their COVID-19 emergency preparedness plan.

This is not enough. As parents often say to their children, actions speak louder than words.

Figure 1: How Advanced Digital Companies Are Helping Customers (as of 11 March 2020, some companies are taking more than one action)

“Put your mask on before helping others” is said on airline flight safety videos. And it’s true. It is important for executive leaders to focus internally to handle the health and economic emergency. It is also important for executive leaders to communicate how they are responding to COVID-19. But now it is time to go further.

The biggest changes in an industry happen during a market downturn. Helping customers during crisis matters. The top three impacts of poor crisis management as rated by board members are company reputation (48%), sales (41%) and productivity (39%). U.K. consumers are pledging to boycott firms that have had poor responses to the crisis. Focusing on customer retention protects revenue. For example, Progressive Insurance once shortened reimbursements by 35% and saw a 50% increase in NPS. Acquiring a new customer costs five to 25 times more than retaining an existing one. Loyal customers are less expensive to serve, concentrate their spending and provide referrals to friends.

Let’s dig into the four actions you should take right now to help customers.

One retail company email said: “There is no reason to fear your furniture.” This might make some customers laugh. But if a customer is afraid particles of the virus could be on packaging, telling them not to be afraid isn’t going to help and could, in fact, backfire. Besides, many of these messages for physical stores or operations become a moot point as governments put citizens under lockdown.

Executive leaders should go beyond providing information and focus on how their enterprises can provide more specific help to their customers (see Table 1). Double down on self-service options to be able to deliver this at scale. These actions use basic digital technologies like email, websites, mobile apps and collaboration software.

Customers are experiencing severe disruption to their daily lives. Executive leaders should identify ways to mitigate this disruption for customers. That is, anticipate and remove the reasonable COVID-19-related “gotchas” that are related to your product or service (see Table 2). A gotcha is something that happens outside of a person’s or company’s control, directly caused by COVID-19. For example, my family and I bought wetsuits and snorkel gear for a spring break vacation that we had to cancel. It would be annoying to not get a refund even though we are beyond the typical return window.

No matter what industry you are in, chances are that your customers are experiencing COVID-19 gotchas related to your products or services. Removing gotchas requires policies and basic digital technologies like email and websites. In a B2B context, this can also be done through relationship managers leveraging CRM systems that flag which customers to contact.

Netflix and Amazon have provided recommendations for other content a customer might like for ages. Motorola provides support during “moments that matter,” or key turning points for B2B customers. Personalized advice is often, but not always digital. For example, Best Buy provides personalized advice by visiting customers in their homes to help them identify the technology solutions they need. Now with COVID-19, they are providing a video call option, so a mix of digital and analog.

With that in mind, here are three actions every executive leader should take to provide personalized advice (see Table 3). These actions include a range of analog and digital technology to enable delivery.

Your customers are stressed. Providing them with advice and then giving them an “easy button” to accept a next action will be a differentiating capability. The “easy button” can be digital. For example, mobile apps powered by AI are helping patients self-diagnose COVID-19. But it doesn’t have to be digital. A friend that makes a few meals for an overworked and exhausted healthcare worker is orchestrating proactive action. Relationship managers picking up the phone is better than nothing if more advanced technology capabilities are not available.

Orchestrating proactive action will help your customers, but it could also uncover new revenue opportunities (see Table 4). For example, Delta Airlines is offering two weeks of Disney+ for free, and 24 Hour Fitness partnered with Trifecta for healthy meal delivery.

A crisis is a great time to change, permanently. As an executive leader, don’t let the incredible work done to better help customers go to waste. You’ve built trust with customers, so hang on to it. Think about what customer practices your enterprise should keep in place after the COVID-19 crisis. Basically, remove the word COVID-19 from the main figure in this report and decide what to maintain (see Figure 2).

Figure 2: Decide Which Changes to Make Permanent Postcrisis

Here’s how:

Step 1: List the practices your enterprise has (and will) put in place in the framework for the COVID-19 crisis. These are explained extensively in the previous sections.

Step 2: Identify the practices that you believe should continue post COVID-19 crisis. Of course these practices will evolve to become “steady state” normal operations and services. For example:

  • Digital commerce volume may be permanently increased post-COVID-19. Customer “freebies” that were considered extra during COVID-19 (e.g., free shipping, increased status communications, easy to find stock-out status) may become permanent services.

  • Waiving fees for changes or services that were considered temporary for the COVID-19 crisis could evolve and become permanent. For example, perhaps a specific customer segment or product (e.g., waiving remote deposit fees for small businesses) may become permanent.

Step 3: Assess the competitive benefits of keeping these new customer services/freebies against the cost of maintaining them. Basically, what is the business case? Remember that your organization has already made the changes. Also, keep in mind that many other organizations have made these changes and may choose to keep them ongoing. Expect a new normal post-COVID-19.

We did an analysis of how the most advanced, digital companies we know of are handling COVID-19 with their customers as of 11 March 2020. This is a fast-changing situation, and the data is a point-in-time snapshot of actions some leading organizations have taken. Advanced digital companies that were surveyed include both incumbents and digital giants:

· 3M Stethoscope

· Airbus

· Alibaba

· Allstate

· Amazon

· BBVA

· Best Buy

· BMW

· Capital One

· Cisco

· Citi

· DBS

· DNV-GL

· Disney

· Domino’s Pizza

· Facebook

· John Deere

· John Hancock

· ING

· Maersk

· Marriott

· Microsoft

· Munich Re

· Nestle BabyNes

· Princess Ships

· P&G

· Singapore Airlines

· Target

· Tencent

· Uber

· Umpqua Bank

· United Airlines

· United Healthcare

· WeChat

· Wells Fargo

We are not saying these are the only digitally advanced companies in the world. They just happen to be the ones that we are tracking especially closely.

We went to the websites of these companies and analyzed emails (as available) that they sent to customers regarding COVID-19 for four things. Has the company:

Evidence

Delta Airlines Email: Disney+ Extended Free Trial Special For You As A SkyMiles Member

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