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Study: Companies clue in to online self-service savings

Firms can save a bundle by letting customers serve themselves on the Web rather than having them place telephone calls to manned centers. What's less obvious is that customers can walk away even happier, according to a new study.

A phone call to customer service to ask a relatively simple question, such as finding out an account balance, can cost a company infinitely more than a query on a self-service Web site. Companies are wising up to this, according to the latest from Frost & Sullivan, a San Antonio, Texas-based research firm.

Industry estimates for Web self-service versus a telephone call are at anywhere from 25 cents for a Web request to $8 and up for a phone call to a customer care agent. Some estimates even place the savings of a Web inquiry versus a phone inquiry at anywhere from $5 to $25 per interaction.

Self-service over the Web, specifically knowledge bases, are becoming a key part of online customer care and CRM initiatives, Frost & Sullivan said. The new report, "Web Self-Service Knowledge Base Solutions," found that the Web-based self-service knowledge base market generated revenues of $123 million in 2000. In 2007, this market is expected to increase to $1.6 billion.

Part of what is encouraging this boom is the increased use of self-service within government organizations, said Katrina Howell, industry analyst at Frost & Sullivan. In addition, as brick-and-mortar stores move online, they will continue to fuel the market.

Self-service knowledge bases can reduce the cost of answering customers' questions and increase their satisfaction, compared with voice, e-mail and text chats. By providing customers easy access to the information they're looking for, while reducing the cost of servicing those customers, companies can present a strong value proposition that will drive a lot of growth in the market, Howell said.

Customer service knowledge bases are rarely the first e-service purchase considered. Instead, the benefits of these systems are seen only after first adopting other applications, like e-mail management and less sophisticated service tools, according to Howell. These other systems often don't produce the results that companies are looking for, which makes the need for Web-based self-service even more obvious, she said.

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Frost & Sullivan

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