Best CSR practices: Foxtrot. Home appliances Name of the company Foxtrot. Home appliances of FOXTROT Group of companies Description of the company this is a network of modern shops and service facilities (more than 200), in which 8 thousand people are employed. The optimal management system, powerful investment resource, efficient coordination and cooperation of actions, and conducting of the general marketing events ensure prestige of the trademark and stable network development. The Distributive network Foxtrot develops 200 shops with the total sales area of 156 583 square meters in 103 oblast and rayon centers of Ukraine. The Company entered the international scene in 2007 and is represented in Moldova by supermarkets Foxtrot and Foxmart. Business problem: Starting from 2005, under conditions of growth of the household appliances and electronics, the tendency of deficit of consumer became apparent. The following problematic zones were identified as the major ones: - weak understanding of consumers needs; - absence of the systemized information on customers; - absence of the multichannel informational system of consumer support; - absence of understanding of the post-marketing interaction between a customer and the company; - absence of coordination of activities among the shops, facilities for service, delivery, and informational support of customers; - absence of mechanisms for measurement (evaluation) and management of loyalty and profitability of customers; - insufficient bottom-up flow of information on the present conflict situations with customers on sites. Proposed solution: The Company chose an innovative strategy of client relations development aiming at obtaining long-term competitive priorities and strengthening leadership positions in the industry. Foxtrot came forward with the know-how by constructing a system of work with clients through active communication with them Program of Comfort during the years of strategy realization (from 2005). Instruments for system s realization: - discount card; - CRM-system; - Contact Center, where highly qualified experts, who clearly understand and know the specifics of our industry, are employed (22 call agents who, being professionally trained, process monthly 60 thousand incoming calls, 2 thousand outgoing calls on monitoring the level of clients satisfaction with the quality of services, and up to 400 web-appeals 1
of our clients). The call agents receive up to 2 thousand service requests and requests for Extra-service each month; - Task Force on Handling Complaints. The experts process claims of the clients related to work of service facilities and shops, to repairs or delivery of goods in cases of incorrect completion of documents, problems with return of goods, and other conflict situations; Benefits for the company: Transfer to brand new level of work, where not the selling process but interest to consumer and establishment of long-term relations with him stands in the spotlight, took place. By early economic crisis in 2008 all the major stages of the project realization were passed and business processes were got up and running, and exactly this helped the company to keep leadership position in the industry under conditions of contraction of the HA&E market. Furthermore, analysis of the consumer requests and finding out the process needing optimization demonstrate customer sentiments pointing on those changes which they want to see in the system of work of our shops. The company gains this information for free. Benefits for stakeholders Work on enhancing law literacy of domestic consumers is being conducted. This is systemic work which needs support of a business. The state control functions and nongovernmental organizations today are not enough for the issues on consumer rights, good will and desire of domestic businessmen to change the situation are also needed. The company gladly shares its experience with the competitors, since spreading of the experience is necessary for enhancing quality of dialogue with the customers over the counter. Changes introduced: Program of Comfort almost doubled the number of loyal customers (2 136 784 persons in 2009). The Contact Center processes from 40 000 to 80 000 messages, received by phone, ICQ, and electronic mail, received with the help of feedback form at the website and forum of the Company each month. The work of Contact Center allowed to: - improve the quality of each call servicing. - economize resources and automate processing of calls external and internal phone calls, electronic mail, appeals at the web-site. - decrease the number of calls left without servicing to the minimum level. - obtain full statistical reporting on calls. - control the quality of the call servicing; - enhance the promptness of the call servicing; - decrease call loss related to overloading of the telecommunication resources; - shorten the time period of the phone calls servicing. 2
As a result, the efficiency of call servicing was raised (the company does not loose clients, utilizes each contact to improve the relations and to increase sales). A common standard of servicing clients appeals and clients loyalty to the company are enhancing. Departments involved into problems' resolving: - CRM-service of the company Foxtrot. Home Appliances ; - Contact Center Task Force of the company Foxtrot. Home Appliances ; Foxtrot is not just Doing Business but Cooperates with Customers The client-oriented business strategy of Foxtrot company is based on the idea of establishment of a brand new level of consumer servicing in the Ukrainian market. We are deeply convinced that work on enhancing law literacy of domestic consumers needs support from business. The state control functions and non-governmental organizations today are not enough for the issues of consumer rights, good will and desire of domestic businessmen to change the situation are also needed. But here Foxtrot came forward with the know-how by constructing a system of work with clients through active communication with them Program of Comfort. We want to prove that Foxtrot is not just doing business but is building up mutually beneficial and open relationships with customers. The major task of the company Foxtrot. Home Appliance is to secure long-term cooperation with customers. Foxtrot always aimed at provisioning its customers with additional services apart from wide range of goods and favorable price. This is worldwide practice but in the Ukrainian market such traditions did not exist. In order to build up partner relationships with each customer separately, we need to understand and to know our consumer. Therefore, the Program of Comfort was established. The company Foxtrot. Home Appliances was the first in the Ukrainian market to make such step. The Program is based on the identifier a card with a unique number. Basing on the history of relationships with the consumer and on the history of purchases, we see which additional services we should provide to each person special offers, favorable prices, gifts, and more detailed consulting of a higher quality related to the requests submitted to the Contact Center. The major task is to build up partner relationships with every our customer. The card is both an instrument of customer identification and basic monetary privilege in the form of discounts (discount system is accumulative). This is beneficial for consumer, since he/she gets more of qualitative services; and for the company, since the customer remains loyal to the company and further purchases goods in the Foxtrot supermarket. In case of preserving traditional price advantages, the emphasis shifts to the loyalty program and new services development. The cardholder (in which program rules and application of participant are described) is also an attribute of the Program of Comfort apart from the Card of 3
Comfort. In our application we ask for minimum data, needed for conducting communications, including electronic ones. Additional points are granted for electronic data provision (mobile phone and e-mail). Any customer can become a participant of the Program of Comfort, it is enough to fill in the application and receive the card of the Program participant. With the help of the Card of Comfort the customers accumulate points (1 hryvnia = 1 point) for purchases made in all of the Foxtrot shops and increase the level of his/her discount. Program of Comfort is not just the discount program. It includes also the professional Contact Center, where highly qualified experts, who understand and know the specifics of our industry, are employed. As of today, these are 22 call agents who were professionally prepared and attended learning trainings. Each month they process up to 60 thousand incoming calls, 2 thousand outgoing calls on monitoring the level of clients satisfaction with the quality of services, and up to 400 web-appeals of our clients. Call agents receive up to 2 thousand service requests and requests for Extra-service each month. Furthermore, the Task Force on Handling Complaints works. The experts process client claims related to work of service facilities and shops. Professionals of this Task Force help consumers in cases of unsatisfactory servicing, consulting, repair or delivery of good, in case of incorrect completion of documents, problems with return of goods, and other conflict situations. We understand that people differ. If incident occurs, then customer while appealing to the Contact Center can expect resolving of any of his issues within 24 hours. This is a unique service which is proposed exclusively by the Foxtrot. Home Appliances company in the Ukrainian HA&E market. We gladly share our experience with the competitors, since it is important for us that the experience on work with the clients would spread in the market, same as the quality of dialogue with people over the counter would enhance. The Company Foxtrot. Home appliances positions itself as a client-oriented company. Ability to recognize own errors, to correct and analyze them and to take all the necessary means in order not to make those errors ever again in the future is an important factor on the way to success. For the purpose of emerging problems solving, the Task Force on Handling Complaints was created within the Contact Centre in January 2006. Dealing with complaints field is at the early stages of development in our country and just few large and dynamically developing companies are practicing activities in this area. Foxtrot. Home appliances is a pioneer in the field and was one of the first Ukrainian companies which established such activities. The major task of the Task Force on Handling Complaints is resolving of conflict issues faced by retail customers of the Company. Range of such issues is very wide. Each incident is special and needs special approach to its analysis and to subsequent decision making. 4
At the first stage of incidents resolving the information on what has happened is gathered. This helps building the objective picture of an incident and identifying the cause of a problem. Then the most important moment of the process of conflict s resolving follows working out and coordination of a solution. During the process of making decisions we are guided by he legislative provisions, foremost by the Law On Protection of Consumer Rights, and also by the presence of facts proving violations. Enforcement of each decision made and coordinated is controlled, and, in the end, conclusions on the magnitude of client s satisfaction with a decision are being made. The final stage of incident s resolving is its closure but work on it is not finished yet, since we set ahead of ourselves the tasks more ambitious than just to resolve a particular problem for a particular customer. Our major aim is full absence of conflict or problematic situations with consumers. A comprehensive analysis of all the incidents and reasons of their occurrence, which are received by the Task Force on Handling Complaints, is made for these purposes. Basing on the obtained data, the models of decisions are being made, which helps customers and Companies to avoid similar problems in the future. 5
Client Methods of Appealing to the Company Aiming concerning Incident's Resolving Methods of Appealing Fixed telephone communication, mobile communication Electronic Mail Appeals through filling in the feedback form at the web site of the Company (Forum) Web appeal Facsimile communication Incident Technology of incident: Service facility does not make a visit on request; Service facility refuse to repair; Certificate of the Service facility on technical condition is not issued; Unsatisfactory warranty repair; A good is being repaired too long; Unsatisfactory installment of appliances; Client is unsatisfied with services of the shop; Documents of purchase are prepared incorrectly; Client is unsatisfactorily consulted while purchasing; Promotional gift or Comfort Card discount is not provided; Refund is not executed; A good from the rotating pool is not provided; Incomplete good; Problems with return of goods; Substandard good; substandard delivery. The client methods on filing appeals to the Company aiming at incident s resolving, and also the typology of the incidents occurrence. 6
Algorithms for processing complaints of the customers can be looked through in the Appendix 1, sheet 2. 7