AT&T Bombs on Customer Satisfaction, Quibbles Over Grade

AT&T ranks as the lowest-scoring cellphone service provider in a new Consumer Reports survey that asked 58,000 customers to rate their carriers. AT&T was the only one to drop significantly in overall satisfaction from a year earlier.

Consumer Reports gave a preview of the results in a blog post on Monday — the full report will appear in the magazine’s January issue due out Wednesday.

More than half of the of the survey respondents who used AT&T as a carrier owned some version of the iPhone, the Apple smartphone that is exclusive to AT&T. iPhone users indicated much less satisfaction with their carrier than owners of other smartphones.

Popularity May Be the Culprit

“A lot of AT&T’s problems may be because of the popularity of the iPhone. The iPhone uses a lot of data,” Allen Nogee, principal analyst for wireless technology at In-Stat told the E-Commerce Times. “Verizon has great ratings, but we’ll see what happens if they get the iPhone. Their ratings may go down.”

If or when Verizon gets the iPhone, there may be a wave of users switching away from AT&T. “These users went to AT&T just for the iPhone,” Nogee pointed out.

The iPhone’s popularity may have lulled AT&T into being lazy.

“The iPhone has allowed them to live with some network degradation,” Michael Morgan, senior analyst, mobile devices for ABI Research, told the E-Commerce Times. “There is a strong draw with the iPhone, and it drew customers to AT&T and kept them there. So AT&T may have saved on network upgrades. The iPhone kept them from having to compete on network capabilities.”

AT&T Argues for Its Quality

AT&T’s customer growth indicates people are finding something right with its service, the company insists.

“We take this seriously, and we continually look for new ways to improve the customer experience,” AT&T spokesperson Jenny Bridges told the E-Commerce Times.

“The fact is, wireless customers have choices, and a record number of them chose AT&T in the third quarter — significantly more than our competitors,” she said.

AT&T’s own data refutes the findings in the Consumer Reports survey, the company maintains.

“Hard data from independent drive tests confirms AT&T has the nation’s fastest mobile broadband network with our nearest competitor 20 percent slower on average nationwide, and our largest competitor 60 percent slower on average nationwide,” said Bridges. “And, our dropped-call rate is within one tenth of a percent — the equivalent of just one call in a thousand — of the industry leader.”

Is the Network the Problem?

Cellphone carriers use different frequency bands for their networks. Part of AT&T’s problem may lie in its network frequency.

“One interesting part people are forgetting is that the carriers use different bands,” said Nogee.

“AT&T band is high frequency, and that’s more difficult because it doesn’t penetrate buildings well. AT&T has a disadvantage from the start,” he explained.

“Verizon has an advantage because of their band,” Nogee continued. “It’s a great band. It’s easier for Verizon to put a network out. That’s part of why the survey looks the way it does.”

Another factor in play may be how each carrier is building out its network.

“AT&T may be focusing more on coverage first, then bringing the whole network up, while Verizon may be focusing more on quality then moving to more coverage,” said Morgan.

Still, there are factors other than network quality, he noted. “These ratings are not just about coverage — they are also about customer service issues.”

At any rate, the survey is a snapshot it time — perhaps just a momentary bad time for AT&T.

“It breaks down to this: What was their strategy and approach? Wait a bit,” said Morgan. “I won’t be surprised to see AT&T’s quality go up.”

1 Comment

  • You failed to mention that Verizon has no fallback network. If AT&T’s 3G goes down, customers are still able to use EDGE as a fallback in a worst case scenario situation. AT&T continues to invest millions of dollars in their network every day. If the network was really as bad as you are claiming, customers would not continue to come over to AT&T’s service, iPhone or no. Even if Verizon gets the iPhone, their network does not support voice and data simultaneously like AT&T’s, which is going to be detrimental to thier customer satisfaction. I doubt this will be any different with their launch of "4G." This says it all: "The fact is, wireless customers have choices, and a record number of them chose AT&T in the third quarter — significantly more than our competitors."

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EXPERT ADVICE

How AP Automation Bolsters Supplier and Customer Relationships

Retail companies have always succeeded or failed based on how well they serve their customers. When service is consistently great, it’s that much more likely that customers will become loyal to a specific retailer.

That’s a big deal because — while they might account for only 15% of a retailer’s customer base — loyal customers can drive as much as 70% of all revenue. Create more loyal customers and the results will follow.

On the flip side, when the customer experience is inconsistent or hits a speed bump, customers are quick to find a substitute. After all, the customer experience is a key differentiator today, and competitors are always a quick search away.

In today’s fast-paced, on-demand world, customers expect orders to be in stock and shipped quickly. If they go to a website and products aren’t available — or they’re told they need to wait weeks to get something — that’s a customer service breakdown that could lead them to search elsewhere.

When retailers are suffering from supply chain and operational problems, they’re incapable of delivering exemplary customer service in each interaction. For this reason, retailers need to focus on strong supplier relationships to keep customers happy and satisfied. By doing so, they can mitigate supply disruptions while offsetting rising inflation and increased labor costs while ensuring their products are available to customers where and when they need them.

One way retailers can minimize supply issues and strengthen supplier relationships is by automating accounts payable. AP provides a key interface with suppliers and is the lynchpin to getting those suppliers paid on time. Slow, tedious AP interactions will lead to difficulties with suppliers.

With an AP automation solution in place, retailers can achieve streamlined and automated straight-through processing of invoices, give suppliers visibility into their payments, and avoid credit holds — all of which enable them to focus more on improving the customer experience.

Achieving Straight-Through Processing

Retailers typically approve supplier invoices using a three-way matching process where they compare the invoice, purchase order, and goods receipt to make sure they pay only for what was ordered and received. When they receive a shipment, they make sure the invoice matches what the purchase order indicates and that the receipt reflects what was actually delivered.

The challenge is that many suppliers in the retail industry are notorious for not correctly including all the necessary information needed to process and pay an invoice. At the same time, it’s not uncommon for suppliers to ship different products at different times — even though they’re on the same invoice — which presents a challenge for three-way matching.

When retailers manage this process manually, it takes a lot of resources and requires collaboration with a number of internal stakeholders, including employees in receiving, procurement, and AP.

By automating the AP process, best-in-class retailers achieve straight-through processing for more than 95% of invoices. This means they are received, verified, and matched without manual intervention 95% of the time, a sharp contrast to the retailers that rely on a tedious, slower manual process.

As a result of automation, the AP function — along with other internal stakeholders — can reclaim a considerable amount of time, giving the organization more resources to devote to enhancing customer service.

Giving Suppliers Transparency Into Payments

Businesses that use leading AP automation solutions form direct digital connections with their suppliers. They grant suppliers easy visibility into the status of payments, which promotes financial stability and prevents them from calling and emailing the AP team to ask about when they are scheduled to be paid, further tying up company resources.

Additionally, AP automation tools give retail organizations visibility into invoice payment options.

With a glance at an invoice dashboard, or with automated rule-driven technology, AP teams can decide which invoices to pay early and receive a discount or hold cash until the invoice is due to extend cash flow.

This helps maximize their cash position, which prevents the need to trim resources elsewhere in the organization to pay bills.

Avoiding Credit Holds

When an invoice enters a manual three-way matching process, payments slow down.

For example, imagine a retailer buys 10,000 shirts from a garment manufacturer with the intent to sell them out of their e-commerce store. For argument’s sake, let’s imagine that the purchase order is for 10,000 shirts and the invoice is for 10,000 shirts, but the retailer only receives 5,000 shirts.

They don’t want to pay for the full order because they’ve only received half of it. So now, they must decide: Do they wait for the rest of the shipment to come in before paying the bill? Or do they pay half now and half later?

Such decisions take time — and, depending on how many issues like this materialize — potentially a lot of it. If suppliers must wait a substantial amount of time to get paid, they may eventually decide to not ship products to you and put you on a credit hold.

Ultimately, this becomes a customer service problem because you won’t be able to fulfill orders and send your customers what they’re looking for.

By automating the AP process, you can avoid these types of delays. Suppliers get paid on time, enjoy visibility into what’s happening with their payments, and rate you as easy to work with. In turn, they are more likely to prioritize your orders should they run into operational challenges or supply issues of their own.

Strengthening Customer Service with AP Automation

When most retailers think about improving customer service, odds are they don’t think about how investments in AP automation can make that happen. But in many ways, AP automation is the low-hanging fruit retailers should grab first.

By optimizing the AP function and enabling suppliers to get more visibility into their payments, retailers can fortify supplier relationships, making it that much easier to keep products in stock, fulfill orders rapidly, and otherwise delight their customers in each interaction.

That’s the ticket to a more satisfied, more loyal customer base — one that’s ready to help retailers weather the current economic storm and end up in a stronger position on the other side of it.

Shan Haq is vice president of corporate strategy and development at Transcepta, a cloud-based procure-to-pay platform based in Aliso Viejo, Calif.

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5 Ways Chief Customer Officers Can Drive Net Revenue Retention

Though the pandemic isn’t exactly in the rearview mirror yet, we are beginning to understand the effect it’s had on B2B firms across the country — and around the world.

One of the biggest paradigm shifts is an increased appreciation for the customer base. We can’t take our customers for granted — ever. Investing in customer success (CS) isn’t a nice-to-have anymore — or even merely a high priority — it’s existential.

In fact, customer success is the critical growth engine driving net revenue retention (NRR) for subscription-based businesses.

Quick Level Set: What Customer Success Is, and Isn’t

Probably the simplest way to define the difference between customer success and what many companies call customer service is that customer success is about taking care of your customers by providing proactive guidance to help them achieve their desired business outcomes. It’s a continuous partnership anchored in an outside-in lens focused on delivering value and an exceptional experience for your customers.

Customer service (or account management) is about being reactive and solving problems for your customers to keep them in “status-quo mode.” As Gainsight CEO Nick Mehta says, “The difference between account management and customer success is like the difference between a backyard telescope and the Hubble.”

Why NRR Matters

Investing in and operationalizing your customer success team is the number one way to increase your net revenue retention. In fact, even if you keep your sales, marketing, and product efforts static, you’d see improvements to your NRR if you invest in customer success. It’s not just your current bottom line that’s affected: NRR is also the top metric that investors look at when making decisions about where to put their money.

Here are five important recommendations that Chief Customer Officers should focus on to drive net revenue retention:

1. Demonstrate the ROI of customer success to increase corporate spend in CS and CS Ops teams.

Companies that invested 10 percent of revenue in customer service saw the highest NRR. So, if your executive leadership team isn’t up to speed with this data, it’s time to call an all-hands.

Get the organization to understand that CS can be a force multiplier for your business with a compelling framework and data to support it. Show them the stats that investing in CS doesn’t just increase revenue (it’s a growth engine); it also increases the overall valuation of the business.

CS operations needs to be a cornerstone of this conversation. Synonymous to sales and rev ops, if you want to drive operational excellence and scalability within your CS org, there’s a heavy dependence on having the right CS Ops org structure in place to effectively do so. This is critical to nail all three dimensions of people, process, and technology.

2. If your customer success organization isn’t owning NRR yet, it’s time.

Long gone are the days of customer success solely being about “churn management” and customer retention. This is an extremely limiting view of the real impact that your team is having and the power of our customers.

Nearly two-thirds (63 percent) of companies say their customer success organization “owns” their NRR performance. What we’ve all come to learn and appreciate is that our customer base is truly the growth engine for our business. This is how we sustain our recurring revenue, how we efficiently expand and grow our customer base (by delivering on those outcomes) and where our customer advocates are born (fueling net new logo acquisition).

By orienting the organization around this philosophy, it naturally makes sense that NRR should be a metric owned by CS yet impacted by all. Being able to tie the high-value activities of your CS organization to leading and lagging outcomes across all three vectors is key.

3. Focus on having more direct revenue responsibility, in particular with the renewal motion.

Our research shows that 45 percent of companies give their customer success team ownership of renewals. This can show up both in CSMs owning the renewal transaction but also with renewals teams now increasingly reporting into CS.

While the organizational stage and maturity of your business can dictate the various customer-facing roles and responsibilities you need, what is a constant is at minimum having your CS teams involved in the renewal forecasting process. They are laser focused on your customers and often have the longer-lens view on renewal probability and risk.

You can also leverage rich customer health scoring to build predictive GRR forecasting models. CS teams are often at the tip of the spear when it comes to expansion identification. So be sure to give them credit where credit is due.

Partner with your marketing and sales teams to have a customer success qualified leads (CSQL) process and account planning process to pass these to your sales counterparts and execute against them.

4. Invest in digitally-led customer success to scale CS efforts and drive better business outcomes.

One of the hottest topics that comes up in my conversations with CS execs is “how do I scale our CS efforts.” Leveraging digitally-led motions can not only impact your bottom line by automating processes that don’t require human intervention, but they can also be an incredibly powerful vehicle to drive better outcomes for your customers.

In the era of “product-led growth,” users are expecting intuitive journeys and the ability to self-serve where possible. By better understanding our users through product analytics and leveraging technology to tailor their user experience we are delivering against the promise of an exceptional customer experience.

One of the most significant areas of opportunity our research identified was using digitally-led data tools to predict and forecast churn. Fifty percent of companies reported using basic product analytics, such as monthly and daily active user trends and their relationship to predict potential churn.

This reveals an opportunity to use more sophisticated digital tools, such as enhanced product analytics, in-app engagements, coupled with assessments on the business value received to improve retention, as well as drive adoption and expansion. It’s important that your customer success org evolves from a 100 percent human capital structure to one that uses data and analytics to deliver value to your customers and increase NRR.

5. Align the organization around a common value framework to drive end-to-end outcomes.

Though your customer success org should own the NRR metric, it doesn’t mean your team alone is responsible for it. It’s imperative to align the organization around a common language and value framework to prescriptively drive customers to value realization.

This process needs to begin in sales discovery and be seamlessly captured and carried through the onboarding and customer success management phases of the lifecycle. I’ve found that establishing this to be the connective tissue across functions that orients the broader organization around a value driven, customer centric driven strategy.

Another powerful way to break down silos is to create a “voice of the customer” program to ensure you’re aggregating and socializing customer feedback to the teams (like product, for example) that can make long-term positive changes.

The key here is to make sure you have the right processes in place to drive action against the feedback, such as NPS and customer effort scores. Our research shows that the companies that really lean into these types of programs and processes have some of the best NRR rates out there.

It’s clear that NRR is the key metric for companies that want to succeed in a hyper-competitive modern economy. There’s no better way to ensure you’re hitting your target NRR than making sound and strategic investments in your customer success organization.

Kellie Capote is the Chief Customer Officer at Gainsight.

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