Customer Service as Ancillary Revenue

TICSS Customer Service Measurement Model

Image via Wikipedia

I’m suggesting a shift from thinking of customer service as a revenue source — which by definition makes it a form of Ancillary Revenue — rather than a sunk cost.

Don’t you already feel a little bit better about customer service having framed it as a revenue source?? Let’s start with an example.

When I call an online travel agency and they go out of their way to fix a problem, that creates goodwill, which has a value.

The revenue from my next 5 purchases directly related to your customer service efforts is additional revenue.

The cost of acquiring me as a customer is now amortized over multiple transactions and not just one purchase (the one with the problem which never got fixed which led me to never buy from you again).

The revenue generated from telling my friends generates additional revenue (at a low or no incremental cost). How many seconds does it take me to Tweet or worse yet FB post my experience (which you’ll never get to see and therefore can’t fix nor will it show up on any agency report).

Increase in market cap and differentiation. A little bit of customer service goes such a long way; travelers are yearning for the littlest morsel of help. Somebody at that massive online travel agency cares — there’s actually a human on the other side of this phone call.

Take the First Step.

Start with a clear intention of tracking the costs and revenue for a given set of customer(s). Intention is everything!

Start with one product and one set of customers and go from there. .

Use accurate ‘averages’ if you can’t get specific numbers. Limit your pilot to high margin products if that makes it easier internally champion.

Work with your colleagues in marketing, sales and finance.

Track the values on an Excel file if need be.

Apply it to historical data if you have all the data sets.

Why Isn’t This Done

First, Short Term Thinking. As executives and managers, we’re knee deep in the here and now that we don’t have time to think longer term.

Second, It’s not easy. The gravity and scope of what I’m advocating hasn’t escaped me. It’s a nightmare even tracking the costs and assigning a value to them. You don’t have to tell me, I’ve done this, I know.

Third, and I’m no accountant,  but my agency operations background tells me there is no universal report that shows the numbers side by side. Nothing that shows the actual costs for the customer service (say $5.00 in agent salary, $0.25 in phone call..) alongside the newly generated (or projected) revenue coming from the incremental revenue,  goodwill and lower customer amortization costs.

It’ll be worth it in the end.


What personalization means to a travel agency.

Your travel agency has 1 client, ME. Of course you have other clients but as it relates to me, I’m the only one. Treat me that way or come as close as you can.

          Only give me specials to places I regularly travel to. You have my booking history, if I book to Bangkok every 90 days. Guess what, I’ll be implicitly or explicitly interested in BKK deals. If I randomly mention I’d like to go to Fiji someday, remember that and let me know my ‘wish’ triggered a Fiji special.


          Only give me specials from my originating city – the fact that you have a special from some city I’m never going to originate from is useless. I already get umpteen emails and deals and tweets a day with offers, unless it’s about my city then you’re rapidly losing my mindshare. Particularly on newsletters. Personalize them please.


          If you have specials on your website, make sure there are seats at that price. I’m so glad there is a rate of $5 to London but since there were NOT SEATS AT THE TIME YOU PRINTED THE SPECIAL it does me no good. If I have to book between 2am and 5am listening to classical music during a lunar eclipse while only typing with my left hand, please tell me, I don’t mind read.


          Even better, do a random search of qualified dates and include a line like ‘Seats available on October 5th, 6th and 8th with inbound available on ‘October 15th’. At least I have a shot at this deal.


          Speak English. I don’t care about ‘validity dates’. You can have your PNR and it to your Amadeus and kill it with your SABRE. What does that mean. Tell me the validity date refers to when I must start my trip. That’s a lot better. What does 3D/12M mean? How am I supposed to figure out that means 3 day minimum and 12 month maximum?


          Listen to me – have feedback buttons everywhere on your website. I’m high maintenance; I’m your only customer remember. Have a ‘call me’ button that connects to your phone number. Ask for my feedback after you speak with me, after any call I make to your agency, after I make a booking and after I return from my trip.


I may not complete all of those requests but you’ll get more out of me than before and at least I know you care enough to ask. Also tell me where this magic feedback goes to and does anybody important actually read it? Also tell me instances of feedback from others that you actually implemented.


          Call me and ask open ended questions to gauge how I really feel. Don’t have a separate person especially call me ‘to conduct a survey’ and if you do, you better be able to connect me to a travel agent should a customer service problem or a sales opportunity present itself during a feedback call. This is an opportunity for you to shine and convert me back to being a customer. Tip: it would be much better to ask a few questions while you’re speaking to me on another matter like giving me an update or telling me my booking is done (I’ll be in a good mood that way too).


          Be as quick doing support as you are with sales. You were so quick to respond when you were selling me something but now that I have a problem you are ‘magically’ busy. If you were smart you’d be faster in support questions than sales questions. Provide me FAQ’s and ‘top 10 questions’ to read if you want me to not call/email as much. If this question comes up time and again whenever somebody buys this travel product then why haven’t you told me the answer; why did you wait till I asked the question?


          You may think my problem/questions/clarification is ‘no big deal’ and ‘not important’ but this is the first problem of its kind for me – I know you get this day in day out but that doesn’t matter to me and doesn’t make me feel any better. So yes I’m going to be a little impatient and will need you to walk me through this but the good news is I’ll remember you and give you my business in the future.


          I’m not ‘Dear Traveller’ or ‘Dear Valued Customer’. If you know me, you’d greet me by my first name at the very least.


          Call me after I return from my trip and ask me how it was. Wait 5 days so I’m not jet lagged and I’ve gotten over whatever problem is not your fault but that you’ll listen to and offer to help me with anyway. Also call me on anniversaries, important dates, my birthday, new years and if we’re really close on religious holidays. Call, not mass email. Call just to say ‘hi’ and see how things are. I won’t call you back but I’ll remember you called. I know you’re busy but so am I. I’m not lying around on the couch in between booking vacations with you.


          If you have a website, update it regularly. If you are too busy, hire some freelancer on oDesk to do it. Weekly at the very least. I don’t want to see specials that expired last month and a copyright at the bottom that says (2008).  I don’t want to see 2008 when filling out a form that has a date on it; that’s so last year. And when filling out a request form, try to ask me for the information just once and not over and over again. If you want me to visit your site often, don’t’ treat me like its my first time there.


          Make sure your website looks like (color, font, layout, where possible) your business card which looks like your newsletter which looks like your brochures. It lets me know there is a consistent feel to what you send out and not just boilerplate pre-packaged content. Also if you’re website is a FrontPage template, it’s too old. If your website hasn’t had an updated design in 2 years, it’s too old. I may not know what technology you use and I don’t care but all I care about is that your site is easy to use and looks nice and I don’t have to be Sherlock Holmes to find what I want to buy.


          Get certified in a destination (Dubai Certified, etc..). I don’t expect you to be an expert for all destinations but the more places you are the more likely I’ll use you as a resource. I’m calling you to deal with an expert; if I wanted to deal with a faceless corporation I’d have booked online or with somebody else.


          I will call you when I don’t want to buy something. Consider this part of the sales cycle and be thankful it’s not one of 10,000 other agencies or 100’s of other websites I could be approaching.


          Thank Me. Just say thank you, say you appreciate my business. Say you want to earn my business in the future.

I have a laundry list of some easy and some not so easy ways to bring about personalization. Some I’ve listed above.

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