Customer Service Superstars And the Winners Are…

Tags: Customer Service, Logistics, Supply Chain

Logistics plays the role of a lifetime in helping retailers earn rave reviews for outstanding customer service performance. Settle back and pass the popcorn as three leaders reveal their winning secrets.

All retailers say they always put their customers first. But some businesses rise above the rest in their ability to dazzle with outstanding service. If customer service were Hollywood, those companies would top the A-list.

As you'd imagine, logistics often plays a pivotal part in the work of such superstars. How do companies deliver the exceptional service that transforms customers into devoted fans? Let's roll out the red carpet and zoom in for a close-up.

Newegg: Listen and Act

E-commerce retailer Newegg racks up accolades for customer service year after year. In 2013, Forbes gave the electronics-focused company a place in its Top 10 list of Customer Service Champions. And in 2015, Forrester Research named Newegg among the top 15 brands in its Customer Experience Index.

Feedback is the fuel that powers Newegg's successful efforts to win the hearts of shoppers. The company continually mines information from customer phone calls and online comments to improve operations and deliver what customers need, according to Sue Martin, vice president of customer service at Newegg, based in City of Industry, Calif.

Some customers go to extremes to make their voices heard—such as the one who posted a YouTube video complaining that Newegg sold him a used product as new, and not for the first time. When a customer service agent spotted the video, Martin called the customer and listened carefully to his concerns. The customer soon replaced his video with a new one lauding Newegg for its quick and attentive response.

Then Martin worked with the logistics department to get to the root of the problem. It turned out this was not a returned item. Newegg had used the product in a photo shoot, and then restored it to its box, which later went back to the warehouse with other new products. Thanks to the customer's feedback, Newegg ended that procedure. "We now sell any products we use to take pictures for our website as 'open box,'" she says.

Although the incident didn't involve a product return, the customer service and logistics teams took further steps to ensure that no one ever ships a used item by mistake. "Returns are no longer touched by the same people who handle new items," Martin says. "They go to a different area of the warehouse."

Break a Leg

Complaints from customers who ordered a particular brand of speakers also launched an investigation. "The speakers were shipping broken," Martin says of the faulty products. "The bottom legs were breaking off." The customer service team informed the logistics team, which contacted the manufacturer.

At first, the manufacturer denied the problem. Because the speakers didn't sell in large numbers, returns to Newegg and customer complaints didn't set off the manufacturer's alarm bells. "So we invited a team from the manufacturer to visit our warehouse, and we took them to the area with all those broken speakers," Martin says. In the end, the manufacturer—a very large company—changed its packaging to better protect the product. "We haven't had any returns since," she adds.

In Newegg's call center, feedback powers friendly competitions that encourage agents to go the extra mile for their customers. For example, agents might form teams to play a version of Pac-Man. "For every positive story a customer shares online or in another venue using an agent's name, that agent's team can move forward," Martin says. "If they get negative feedback, the team gets 'eaten.'" The winning team earns a pizza party or similar reward.

Call My Agent

Solving a customer's problem often hinges on the ability to expedite a shipment, send a replacement product, or accept a return. So logistics plays a key role in Newegg's customer service strategy. "Our agents are empowered to contact a warehouse to set up an expedited delivery, or pull a product back," Martin says.

Say, for example, a customer orders equipment needed to give a presentation at an out-of-town meeting, and the shipment is delayed. On request, Newegg might expedite a replacement to the customer's hotel.

If a product is out of stock in one region, Newegg might ship it from one warehouse to another, or buy it from a third-party vendor that participates in its Newegg Marketplace. "We work directly with manufacturers, and even drop-ship if we need to," Martin says.

In an emergency, Newegg might even make a personal delivery. Martin recalls a customer who returned a hard drive and then realized it was the wrong drive—one containing sensitive information. "He called us in an absolute state of panic," she says.

The Newegg warehouse had already sent the drive to the manufacturer. Luckily, the manufacturer was able to track it down. And to compound the good fortune, the manufacturer, customer, and call center were all located in greater Los Angeles. "Our sales manager jumped into a car, picked up the drive from the manufacturer, and personally delivered it to the customer," Martin says.

Backcountry: gearheads play lead role

Do business with Backcountry, and the company promises two things: "amazing customer service" and "blisteringly fast fulfillment."

Based in Park City, Utah, Backcountry is an e-commerce merchant that specializes in clothing and gear for outdoor sports. "Our primary mission is connecting customers to their passions," says Chris Purkey, vice president of the department Backcountry calls "Gearhead operations."

"Gearhead" is Backcountry's name for a customer service agent. "It's a badge of honor, given the love we have for the gear we sell," Purkey says. Gearheads are skilled athletes with deep knowledge of Backcountry's products. Their job is to inform, advise, and make sure customers get exactly what they need.

They fulfill that mission even when a solution demands extreme measures. Consider the time a pair of pants, en route to a customer, went astray and then turned up in a battered package too damaged to sell. "They were the last pair we had in stock," Purkey says. What's worse, the manufacturer had stopped making that item.

To get the customer the pants he wanted, the Gearheads went shopping on a competitor's website. "I bought the pants with my own credit card," Purkey says. The customer has since placed several more orders.

Gearheads, Customers Meet Cute

In 2014, Backcountry started a program to encourage long-term, one-on-one relationships between Gearheads and consumers. Some customers choose their own Gearheads—perhaps due to a shared love of skiing in Vermont or hiking in the Rockies, or their preference for a certain brand of fishing gear. In other cases, Gearheads reach out to shoppers.

"When customers place an order with Backcountry.com, there's a good chance they'll get a friendly follow-up call from one of our Gearheads," Purkey says. From then on, any time they buy or return a product, or post a review or question online, Backcountry's homegrown customer relationship management (CRM) system captures that data and notifies their personal Gearhead. "This helps ensure we get ahead of any possible issues, or need for advice or help," he explains.

Purkey's team works closely with their supply chain counterparts to resolve any delivery issues. "We offer customer feedback directly to the supply chain, so they can hold carriers accountable," he says.

"To the same degree, we hold ourselves accountable to ensure that our internal processes—such as processing warranties or returns—are accurate and timely, and create a positive experience for customers," Purkey adds.

On the logistics side, customer service efforts focus heavily on a goal Backcountry set in 2001: to provide same-day shipping for every order placed by 5 p.m. Mountain Time. Today, Backcountry hits that goal 99.5 percent of the time, says Jeff Carter, the company's vice president of global fulfillment.

Backcountry operates two distribution centers (DCs), one near its headquarters and one in Christiansburg, Va. The company uses a proprietary warehouse management system (WMS) designed for maximum picking flexibility to maintain speed in both facilities. If demand suddenly spikes for product housed in one zone, the software can reassign pickers on the fly.

Cross-training also provides flexibility. Say, for example, a limited-time free shipping offer boosts sales by 30 percent. How to handle the spike? "Being able to move employees from an inbound function into an outbound function helps," Carter says.

Another strategy is to focus on multi-item orders early in the day. Single items are easier to pack, so it makes sense to save them for second shift, when deadline pressure starts to build. Backcountry also schedules extra workers, including part-timers, for the second shift.

Locating the DCs strategically near the package carrier's facilities helps, too. In Utah, Backcountry has until 11 or 11:30 p.m. to get orders ready for UPS pickup. "In Virginia it's a little trickier, because 5 p.m. Mountain Time is 7 p.m. Eastern Time," Carter notes. Employees there have only 3.5 hours to get packages ready for the 10:30 p.m. pickup. "We're constantly hounding UPS to move that to 11 p.m.," he says.

Keeping Backcountry's same-day shipping promise is especially challenging on Black Friday and Cyber Monday. "We start early and just keep pushing toward that 5 p.m. deadline," Carter says. Good forecasting helps the company plan for the surge in orders. And, in 2009, Backcountry added a 10-hour Sunday shift to reduce the volume it has to handle on Monday. "During the holiday period, those Sundays become full days for us," Carter notes.

U-Haul: Box office success

U-Haul's U-Box service caters to moving and storage customers who want to handle at least part of the job on their own. One hallmark of this service is the variety of choices it gives consumers.

"We're proud of the options we offer," says Chasan Royer, U-Box project manager at U-Haul in Phoenix, Ariz.

U-Box provides storage containers that customers fill with personal items at home or at a local U-Haul location. Depending on the customer's needs, the box might stay at the retail location, or U-Haul might ship it to another city.

Some customers load their own U-Boxes, while others rely on U-Haul's professional "Moving Helpers" to do the job. A customer can use a personal vehicle with a hitch to tow one or two boxes on a trailer between home and the U-Haul Center, or let a U-Haul-certified driver carry the boxes on a flatbed truck.

Another crucial customer service value for U-Box is information. "We're the only company in the industry that provides a one-way shipping quote, instantly and automatically," Royer says. Customers log into the U-Box web portal to track the progress of their shipments and learn when they'll be charged for various aspects of the transaction.

"Certainty is a big deal for us," says Royer. "We want customers to know exactly what will happen and when. And if anything goes off track, we try to provide transparency through MyUhaul.com."

Do-it-yourselfers get information to help with processes such as loading a U-Box or hitching a trailer to a vehicle. "We constantly give our frontline employees educational materials they can pass along to the customer," Royer says. Besides printed instructions, customers can opt to receive emails or text messages, or check online for instructional videos.

Taking Pride in Performance

On-time performance and communication are other points of pride. "We require all our carriers to meet an on-time pickup and delivery goal of 98 percent," says Craig Picone, senior freight buyer for U-Box. Drivers who haul U-Boxes between cities must also set pickup and delivery appointments, and make four check calls while in transit. Carriers must meet those communications requirements at least 95 percent of the time.

Based on U-Haul's 70 years of experience renting trucks and trailers, the U-Box team knows that convenience is an important service value. "We can offer convenience by providing more neighborhood locations that are near our customers," Royer says. Not all U-Haul locations offer the U-Box service, but the company continues to add them. In metropolitan areas, most customers can find a U-Box within three miles or fewer, either at a company-owned site or through a reseller.

To make sure customers can always get the boxes they need, Picone and his team continually analyze the inventory at U-Haul locations. They work with carriers to deliver freshly built boxes and to reposition boxes that have been delivered and unloaded. "The worst thing is to have too many boxes where there are no customers, and not enough boxes where there are customers," says Picone.

The drive to balance U-Box inventory includes efforts by traffic management teams who work in regional U-Haul offices. "The traffic managers use our internal tools to make sure inventory is where it needs to be," Royer says.

Like other service stars, U-Haul sometimes takes extraordinary measures to deliver what customers need. Take the time a customer driving a 26-foot U-Haul rental truck broke down on the way from New Mexico to Washington. With no replacement truck available nearby, the truck and trailer department contacted U-Box. "We got that truck unloaded into U-Boxes, and then shipped the U-Boxes from where they broke down in Colorado into Washington," recalls Picone.

Among the partners that help to make the U-Box service outstanding is GlobalTranz. The Phoenix-based third-party logistics company chooses the carriers for many shipments of loaded U-Boxes and monitors their performance. Sometimes it consolidates boxes from several customers to produce faster, more efficient trips.

GlobalTranz employees know that when they handle a U-Box shipment, they're moving a customer's personal belongings. "When it doesn't show up on time, it's not like one pallet not showing up at Walmart," says Mike Leto, president of sales for GlobalTranz. "So we make sure those situations never arise."






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