How Customer Experience impacts employee turnover, customer churn, and win rates.
Shippers’ standards are changing drastically. The good news is that if you’re reading this article you are already taking the first step towards maintaining (or recovering) your competitive edge in the market: looking critically at your offerings and staying up to date of industry trends.
Customer Experience is steadily becoming top of mind for shippers when evaluating freight forwarders to potentially manage their orders. The implementation of recent technology is creating a shift from traditional manual Customer Service towards service enhanced by software solutions– leaving more time for value-added jobs like strategy and personalized service (read about customer experience vs. customer service here). Investing in Customer Experience solutions for your shippers gives you a competitive edge against other freight forwarders and newer digital forwarders.
How do you know if your Customer Experience needs to be revisited? This post outlines three signs that might indicate a need to upgrade your Customer Experience:
- Increased Employee Turnover
- High Churn Rate with Shippers
- Losing Deals to Digital Forwarders
Let’s dive into what those signs mean, how Customer Experience impacts each one, and what you can do to fix or improve the experience for employees and customers.
Sign 1: Increased Employee Turnover
The current, low supply of workers in the logistics industry increases the importance of retaining employees. Implementing proper Customer Experience protocols and solutions directly impacts their day-to-day work. Increased employee turnover in your freight forwarding business can be an indicator that your Customer Experience needs an upgrade.
We’ve outlined below the impacts of an outdated Customer Experience on turnover, how experience can decrease turnover when done right, and how to evaluate your own company to see if your Customer Experience could be affecting your employee retention rate.
How Customer Experience Impacts Turnover:
A critical part of providing shippers with a great experience is thorough and timely communication. When you see your employees spending time on lower value, more administrative tasks like emails, phone calls, spreadsheets, and copying data from one source to another, it’s a sign that their work environment is not being optimized with the solutions available to make their jobs more efficient.
These types of repetitive tasks are challenging, not motivating, and can be mind-numbing for your employees. With multiple solutions available to help with these tasks, it can be disheartening when a company will not invest in the value of making their employees’ work more efficient. Additionally, this leaves more room for human error that can take up the time of your team and your shippers to redo.
Eventually, these factors can cause employee turnover by burning out your team on these tedious tasks. It can also hurt morale and make it harder to recruit new people onto your team.
What it Looks Like When Done Right:
When Customer Experience is done right, you’ve implemented technology, processes, and systems to help automate or make these manual administrative tasks more efficient. This can be completely automating some tasks and/or supporting employees with tools & resources that can give them more time to spend on higher-value activities.
Examples of Customer Experience touch points that have technology solutions readily available to improve the overall experience are:
- Shipping visibility
- Automated booking/quoting processes
- Data enhancement
- Document automation
- Online payment options.
Take a critical look at where your own team is spending the most time on repetitive tasks to identify areas you may want to start implementing Customer Experience software. When you’re able to automate these tasks, it frees up people’s time to spend on greater value, higher impact activities that bring more fulfillment to employees and greater impact to the business.
Questions to Ask Yourself:
- Are my employees having to send hourly/daily/weekly updates to customers on shipments?
- Are they spending time looking up shipment updates and putting them into different systems?
- Are they spending a lot of time downloading/uploading documents?
- Are employees spending time building personalized spreadsheets for customers?
If your answer to these questions is “Yes”, it is an indication that your team could be investing in technologies to support how your employees interact with customers to help streamline workflows and improve internal efficiencies: freeing up your team to do more while still keeping your customers happy and up to date.
Employee turnover is not the only turnover that can be a sign of a Customer Experience needing an upgrade. High shipper churn rates should be analyzed for connections with Customer Experience as well.
Sign 2: You Have a High Churn Rate With Shippers
Since the start the pandemic, both order volumes and supply chain delays have increased. Although improvements and protocols have been made to move forward from this chaos, shippers still expect access to better visibility and better overall experience from their forwarders. An increased churn rate with shippers can be a direct sign that your Customer Experience may need some serious work.
Let’s dive into the impact of a poor Customer Experience on shipper churn rates, a revamped Customer Experience’s impact on building lasting shipper relationships, and what to be watchful for in your own offerings to indicate churn is related to Customer Experience.
How Customer Experience Impacts Churn:
Churn rates impacted by poor Customer Experience can look like:
- Having a low rate of returning customers after your first experience managing orders for them.
- Losing business from shippers you have had longer relationships with, even if it is a slower transition over time (with fewer and fewer orders placed through you).
An outdated Customer Experience creates more work and anxiety for shippers by adding friction to the process of sending, receiving, and updating information. Communication takes longer, messages can be missed, and information is outdated or not centralized.
Shippers are not going to spend time creating processes and protocols to get the information they need from forwarders when competitors are offering a direct view of this information with the click of a button. Whether it is shipping visibility, data access, or sharing files in a specific location, shippers are looking for forwarders who will not make them spend extra time accomplishing their tasks, and they will ultimately continue giving their business to the forwarders making their experience better.
What it Looks Like When Done Right:
When done right, you have tools available for your shippers to give them the option of independent access to data to decrease mandatory customer touch points and a differentiating experience that keeps them coming back.
Building or buying a solution that offers a digital dashboard for shippers to see key data points (like arrival estimates and visibility) gives peace of mind and offers assurance they are working with a forwarder that prioritizes keeping up to date/competitive with their offerings. Having a tool like this for them to use gives your shippers more power, more control of their time, and access to key data points to continue to improve their supply chain efficiently and autonomously.
Take a peek into how your customer touch points compare to what’s out there. If your shippers are not getting the simple to use, easy-to-access solution they need, you will see churn. Provide tools that make you integral to their operations with visibility, data, and more.
Questions to ask yourself:
- Can shippers access real-time data and updates on their orders without speaking directly to one of your team members?
- Can shippers export desired data points on their own or do they need to be acquired from your team?
- Are you noticing lower volumes of shipments from typically consistent customers?
Ask yourself these questions, create surveys to hear directly from your customers, and make sure to take note of what gaps you are seeing between your Customer Experience offerings and competitors.
Technology and Customer Experience are woven together as new technology innovates the freight forwarding industry. If that isn’t reflected in how you interact with shippers, you may be losing new business to competitors that build their whole offerings around digital Customer Experience.
Sign 3: You’re Losing Deals to Digital Forwarders
With recent changes seen throughout the industry, technology is the name of the Customer Experience game and digital forwarders have set up their business to prioritize this convergence. There have been significant capital investments into the growth of “digital forwarders” in recent years, creating waves in the market and drawing the interests of shippers. Flexport, a leader in digital forwarding, now owns 1% of all containerized US GDP and services nearly 10,000 companies. If your team is consistently losing business to digital forwarders, your Customer Experience offerings may be impacting your ability to compete against these new players in the freight forwarding industry.
While it’s still up for debate how well digital forwarders can execute logistically compared to traditional forwarders, it’s clear they are creating more competition in the market. They’re not winning because of logistics experience, they’re winning because of the digital Customer Experience they are promising and extensive marketing to shippers.
Let’s dive into the impact of quality Customer Experience on winning new shippers and what to look for when evaluating if your company’s Customer Experience is helping or hurting your competitive edge against digital forwarders.
How Customer Experience Impacts Winning Against Digital Forwarders:
If you aren’t able to compete for new clients against digital forwarders, see shippers deciding to work with forwarders with better digital offerings, or have customers you have older relationships with questioning your technology, it’s time to challenge your team to upgrade your Customer Experience. Shippers are looking for better technology ingrained into Customer Experience and automation options for routine tasks.
Newer and existing shipper relationships will be strained or lost if you cannot meet the same level of Customer Experience that is being offered by digital forwarders, even if your team provides more experience on the technical aspects of logistics. Winning against the digital forwarders is achievable and has been done, compete against them by ensuring you have a Customer Experience that pairs with your logistics execution to support your shippers on all fronts through the forwarding process.
What it Looks Like When Done Right:
When done right, your Customer Experience solution provides an aesthetic, easy-to-use tool for your shippers to use and protocols for direct messaging to your shippers that share how your company will prioritize staying up to date with new tech as it arises. Your team has the industry knowledge, connections, and experience to give you the leg up against newer competitors in the industry, so use that to your advantage against digital forwarders and arm yourself with a Customer Experience that levels the playing field. You’re able to provide the best of both worlds: amazing logistics expertise with a modern digital customer experience.
“What we find is when traditional freight forwarding companies that have not raised this money partner up with companies like Vector AI or like Logixboard,” Logixboard CEO Julian Alvarez said “It evens the playing field and traditional freight forwarding companies ends up winning that business.”
Buying or building this solution is the next question to answer with your team. Many have not set aside funding to build a solution that can compete with the solutions digital forwarders are offering to shippers. Opting to buy an external solution offers many benefits.
- Time to Value: Many external solutions are quick to implement and give you a quick turnaround time to offer your new solutions to shippers.
- Continued Innovation: External solutions and software have their own funding and prerogative to always stay up to date with the best Customer Experience offerings, taking that burden off your chest.
- Cost: Building an in-house solution that is competitive with digital forwarders is pricey and time-consuming. The money saved on a subscription solution, avoiding man-hours on a large internal build, and quick implementation sales equate to a great return on investment.
An internal or external solution that enhances your Customer Experience with technology is critical to winning against the competition. It’s up to your team to decide which is best for you after evaluating your current shipper experience.
Questions to ask yourself:
- Does your team have digital offerings for customers that can compete with digital forwarders?
- Has your team analyzed digital forwarder offerings in a competitive analysis?
- Are customers bringing up technology they have heard of from digital forwarders?
- Are digital forwarder offerings brought up during sales talks with potential customers?
Ask yourself these questions, then ask your team when the last time these questions were answered as a company and the last time changes were made to your Customer Experience.
Bonus: You Haven’t Made Major Updates on Your CX in the Last 5 Years
Customer Experience offerings and related technologies in the logistics industry are evolving continuously. Make sure your operations are optimized to be the most efficient they can be for the sake of a happy team, better customer interactions, and better overall productivity and resulting profit for your freight forwarding company. If you aren’t working with an external solution to provide the latest technology and processes for your Customer Experience offerings and you haven’t made major changes to an internal solution in recent years, then it’s time to upgrade your Customer Experience.
Stay up to date on Customer Experience offerings by setting a schedule and process to routinely evaluate your offerings against competitors in the industry. Make sure you are maintaining up-to-date knowledge on technology innovation implemented into the logistics industry. Continue surveying customers on their changing needs to help predict upcoming technology solutions. Being complacent with your offerings is not an option during this time of Customer Experience innovation in the freight forwarding industry. If the three signs discussed above apply to your freight forwarding team, you know it is time to take steps to upgrade the quality of experience you are offering shippers.
Companies should be taking a look at their Customer Experience, how it impacts their team and their shippers, to see if there is room for improvement that will benefit everyone involved. Employee turnover, high shipper churn rates, lack of technology, and legacy customer service offerings are indicators your customer experience is ready for a makeover.
The next step is researching solutions that will take your Customer Experience to the next level. Compare external solutions to find the one that fits the needs of your business. Logixboard is a white-labeled customer experience software that helps logistics service providers increase sales and retain customers. With a quick demo, explore what that next step could look like for your company.
You get to decide the experience your customers receive when they work with your team. Make sure every touch point of your Customer Experience has evolved to meet shippers needs and continues to enable your company to thrive.