October 15, 2012
Auto-ship programs offer ecommerce firms a nice ROI, producing a regular stream of repeat purchases without the need to invest additional marketing dollars to generate these sales. For the customers who opt-in to these programs, automatic shipments provide convenience, and in some cases, financial benefits in the form of discounted pricing and free delivery.
But automatic shipment should never be confused with automatic customer satisfaction, which is why one of our clients, an online retailer of specialty products, developed a test around the online cancellation process for its auto-ship program. The primary goal of the test was to see if phone contact with a customer service representative could win back customers who were canceling their program memberships.
A secondary goal involved looking at whether this level of person-to-person interaction would yield deeper insights into why customers were ending their memberships than the information typically gathered via the online cancellation process.
For the test, the online retailer presented the experiment group with a message directing them to call a toll-free phone number in order to cancel, instead of the control process of filling out a web form.
How did customers in the test group respond to the phone-only option? Just 3.3% of these customers were persuaded to maintain their program membership, and 10% expressed their displeasure at having to make a phone call to cancel their auto-shipments. On the secondary goal around insights, the customer service representatives' call notes did not surface any additional details beyond what the online cancellation process already provided.
But the insight that truly benefits the online retailer from this test is knowing that customers prefer to cancel their memberships via the website, which is certainly more cost-effective than the expense associated with bringing in the call center. Plus, providing a positive customer experience across all interactions is key to keeping the door open for future sales and customer referrals. That's turning a so-called "loss" into a "win!"