Companies that introduce self-service options earn more from their customers. Why?
We’re getting used to walking into our favorite fast-food restaurant and making a choice about whether to go to the cashier or one of those ten self-service machines that are now available.
In fact, it’s not much of a choice. We usually pick the self-service option and when we do, we spend more. ”Do you want fries with that?” seems to work much better when we’re dealing with a computer rather than another person. When Taco Bell in the US introduced a digital app to make purchases, the average spend was 20% higher. Their customers were, in large parts, selecting additional ingredients. Another American fast-food chain Chili’s witnessed the same kind of increase with a self-service tablet.
A few years ago, Duke University in the US, together with the University of Singapore, set out to get the answer as to why this is the case. The academics looked at data from Sweden’s state-run alcohol monopoly retailer Systembolaget when it changed the way it sold drinks from over-the-counter to self-service way back in the 1990’s. They noticed a particular increase (8.4%) in hard-to-pronounce drinks. Similarly, they saw a pizza retailer in the US introduce an online ordering system that resulted in 14% more special instructions and 3% more calories per meal.
What’s happening here? The academics base it all on what they call ’social friction.’ Social friction occurs every time one person interacts with another. When you introduce a computer to take your order, you eliminate social friction and this has several effects.
You don’t have to go through the embarrassment of pronouncing awkward names. You don’t feel like you’re being difficult by giving special instructions and you don’t feel quite so self-conscious ordering the extra large burger. Nobody else is judging you.
There are additional factors also. If you’re using an online ordering tool or one of 20 kiosks in a restaurant, you’re not causing a queue. You’re not quite as stressed as you might be otherwise. Yet again, social friction is eliminated.
So how is this applied for mobile operators? Already today, If I want to figure out what’s the best subscription plan for my new mobile, then I can think about it at home and order online instead of waiting impatiently in a physical queue and feeling a little stressed about making my decision immediately. Without social friction, these kinds of purchases are more comfortable. The same goes when I’m abroad and get recommended different roaming offers to choose from.
But also, using self-service from a more technical perspective could also lead to a more relevant kind of upselling. If you use self-service to find out why you’re always getting poor coverage out in the summer cottage, then the application could suggest you get the 4G router with that external antenna to put on the roof. Or if you seem to have problems making calls while at home in town and start troubleshooting the problem, an app could recommend you upgrade your phone to one that supports wifi-calling. A computer never forgets to upsell and now you, the consumer, have the time to think about it. It doesn’t have to be a split-second decision since you’re not holding anyone else up.
So. Is our world geared up for all the self-service? Not quite. The absence of social friction can also mean the absence of social interaction and that’s not always so positive. Sometimes, we really need to speak with someone. We are social animals after all.
”It’s about knowing when self-service is right,” says Magnus Zimmerman, CTO at Subtonomy. ” For simpler tasks, then an automated cashier or service desk is fine but for other instances, the lack of social interaction may be detrimental. It’s important to know when to trigger a customer to go from self-service to a person and making sure that transition is seamless. We all hate having to repeat ourselves.”
Remember also that when gearing up on self-service, you’re basically asking your customer to do some of the work for you so you need to make it worth their while. Three criteria worth thinking about are:
Make it clear to your customers what you expect from them
Make it easy enough so that they can do what you’re expecting
Show them why it’s worth their while
IBM reported in 2017 that they expected 85% of all customer interactions to be done without a human agent. They also noted that, in a six-minute customer service call, 75% of the time was spent by the customer service agent manually working on the problem. Actual customer interaction was just 25%.
”The goal then is to shift that time to 75% focused on the customer and only 25% manually solving the problem,” says Magnus.
The role of the agent will still be critical. It will just be a more qualified agent who can support more complex queries. And regarding up sales – though agents today play an increasingly important role working now also as sales representatives, perhaps we should let machines do part of that job as well.