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Abandon Rate Management and Customer Retention
Among the parameters used to measure a service center’s performance, the
Abandon Rate is perhaps the most critical. The Abandon Rate measures the
number of customers who arrived and joined the queue, but decided to leave
while waiting. A high Abandon Rate could be the result of long queues, an
unpleasant waiting area, or of overall customer dissatisfaction, and is a
predictor of customer churn.
The following article describes several ways in which a business can
measure Abandon Rates more accurately, minimize abandoning and improve
customer retention.
Measuring Abandon Rates
Accurate measurements of Abandon Rates are essential for effective
customer service management. There are different factors which may
interfere with this measurement:
● “Balking” – customers leaving before even
joining the queue (either because of a
long line or because of an unappealing entrance), will not show on
statistics.
● “Temporary Reneging” – customers leaving
the queue temporarily, with an intention
to return, may be registered as having abandoned the queue.
● “Fictitious Customers” – customers may take
extra tickets, either intentionally or by
mistake, and these tickets might later show up as customers who have
abandoned
the queue.
● Improper use of the system’s abandoning
customer identification tools.
Balking
Balking is not only a negative phenomenon, it is also difficult to
monitor; customers can decide not to enter our branch office or shop, and
we would never even know they were there. It is therefore important to get
every customer to take a ticket and join the queue, even at the expense of
a potential increase in recorded Abandon Rates.
To effectively prevent balking, consider the following approaches:
● Design an attractive and inviting entrance.
● Design the lobby area so that actual queues
in the waiting area are not seen and,
just as importantly, not heard from it.
● If a self-service ticketing kiosk is used,
decorate it and design a friendly user
interface to make it less intimidating and more appealing.
● An attendant or receptionist may
“intercept” customers who seem to hesitate in front
of the kiosk. Of course, this needs to be done very carefully and gently.
● If a lobby manager is employed, having him
stand up (instead of sitting down behind
a desk) would minimize the chances of customers making a U-turn and
leaving
without taking a ticket.
Temporary Reneging
Customers who suddenly decide to leave the queue and come back later can
create a considerable disorder in the waiting area, and give customer
service agents quite a headache. We would want to minimize temporary
reneging, and at the same time – provide a methodical solution to manage
such events when they happen.
To minimize temporary reneging, consider the following approaches:
● Provide waiting customers with a visual
indication of the queue progress, so that
they can predict when their turn is about to arrive.
● Make the waiting environment more pleasing
and interesting than its surrounding
area.
● Design the service center so that
restrooms, nursing and (if so required) smoking
areas are as close to the waiting area as possible; consider placing some
queuing
system speakers or even displays in those areas.
To provide a methodical solution to manage temporary reneging, consider
the following approaches:
● If possible, have an attendant or lobby
manager register customers leaving in the
queuing system, and then re-position them in the queue when they return.
● Provide agents with the option to call a
customer who has been registered as
abandoning.
Fictitious Customers
This phenomenon is usually unique to businesses using a self-service kiosk
for issuing tickets. It can be quite difficult to distinguish fictitious
customers from real ones who have left the queue.
To reduce the effect of fictitious customers, consider the following
approaches:
● Get incoming customers to provide some form
of ID.
● Make self-service menus and options as
clear as possible to first-time visitors;
Most customers will take extra tickets simply because they are not sure
which queue
they should join.
● Allow managers in the branch to remove
fictitious customers from statistics, if they
know for sure that it is right to do so – e.g. if a customer admits to
having taken an
extra ticket by mistake, or if unused tickets are found.
Abandoning Customers Identification Tools
Simple queuing systems usually only provide very crude means of
identifying abandoning customers, the most common is based on short
service times: The system, or its reports, automatically regards customers
with short service times as having abandoned the queue before they were
called forward.
Callflow Software, on the other hand, supports multiple approaches to
identifying abandoning customers more accurately. Every organization can
choose and apply the approach which best suits its business logic.
Minimizing Abandon Rates
Once we have a system in place for measuring Abandon Rates accurately, we
may focus our efforts on actually reducing those rates.
The Abandon Rate is affected by an array of factors, the most significant
of which are shown in the following diagram.
Note that we cannot change the customer’s individual patience level – that
is part of a person’s basic character. Nor can we change, within the
context of this article, that importance of the specific service to the
customer – this is affected by the type of service, available alternatives
and so on.
However, we do have control over the elements colored orange in the
diagram:
● Actual Waiting Time – mainly a result of
staffing and agent management, this
subject is much too broad to discuss in this context. Long waiting is the
single most
important reason for abandoning, and considering the potential cost of
abandoning
customers (and ensuing customer retention efforts) a minimal waiting time
should
be top priority.
● Uncertainty can significantly increase the
perceived waiting time. By keeping
customers constantly informed – using queue status and progress displays,
they
become more relaxed, and waiting seems shorter.
● The Waiting Environment has a major effect
on how waiting time is perceived. A
noisy and over-crowded waiting room makes customers edgy, while a room
that is
too quiet and dull makes customers keep looking at their watches. The
optimal
environment is one which is calm and spacious, where a waiting customer is
free to
walk around and browse through products or brochures. If a long wait is
expected,
magazines and internet stations would also make the passing of time seem
shorter.
● Fairness of Queue – studies have shown that
customers are willing to wait longer if
queue management is fair, i.e. customers are served in the order of
arrival (in FIFO
queues) or according to schedule (in appointment-based services). Using a
computerized queuing solution can certainly help here, since computerized
queuing
is generally perceived as fair.
● Customer Mood – this is the result of a
combination of secondary factors, many of
which can be managed or at least influenced by us: A positive reception
experience,
in which the customer is identified and personally greeted, sets a good
starting
point. Apologizing for any interferences, such as drilling sounds from the
basement
floor, is also important. Paying attention to the customer if waiting gets
exceptionally
long has a huge impact, and a cup of coffee offered to waiting customers
can go a
long way. A queue management solution that can send long-queue alerts to
agents
responsible for taking care of waiting customers, can support such
efforts.
Customer Retention
However hard we may try to keep Abandon Rates down, some customers will
slip through the net. Customers who have left the queue pose a serious
threat to the business:
● Lost Sales, Reduced Customer Loyalty,
Customer Churn – if a customer was
waiting to purchase goods or services, and did not get these goods or
services,
chances are one of our competitors just made a sale, or even gained a new
customer.
● Reduced Customer Satisfaction – even if the
customer has not yet defected to one
of our competitors, his satisfaction with our level of service would
plummet. This,
with time, increases the probability of losing this customer.
● Damaged Brand Image – all our investments
in interior design and making the
service center reflect the brand values, will go to waste or even have a
negative
effect, if customers did not get what they wanted from us.
Clever handling of customers who abandoned queues can help repair much of
the damage. This can be done online in the service center, or offline by
the customer retention department (or a similar business function). Note
that almost all retention efforts rely on customer having identified
themselves at the reception; very little can be done to address anonymous
people who have left the queue and went away.
Consider the following approaches for online customer retention:
● In cases where the lobby manager or kiosk
attendant can identify which customers
are leaving the queue, the may try to intercept them. Usually, at this
point, little can
be done to prevent them from leaving, but it may be possible to suggest a
customer
service representative will call them at a later time to try and help
them.
● A “Retention Box” may be placed by the
exit, where customers can drop their tickets
if they want to be contacted later. Of course this requires that either
the customer ID
or the Case ID are printed on the ticket.
Whether online efforts where made or not, at the end of the day it will be
the Customer Retention department’s goal to contact abandoned customers
and attempt to recover their loyalty and satisfaction. The following
sources of information will help compile contact lists for customer
retention:
● Tickets collected in retention boxes, or by
service center employees.
● Abandoning Customer reports, provided by
the queue management system.
By putting all these techniques to use, the business can significantly
improve customer retention and as a result – increase sales and long term
customer loyalty.
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