The Butterfly Effect: A Theory in Mathematics, An Ideology in Customer Service
An elaboration on how an experiment could turn into a theorem, which evolves to a belief
Written by Satrio Bimo Wijardono and Septina Eka Kartika Dewi
From An Experiment to A Belief
Edward Lorentz, a physicist, once posed a thought-provoking question that turned out to become the main field of study in Chaos Theory. The question challenged Pierre-Simon Laplace’s thought experiment, who argued that for a body that knows how the laws of the universe work up to its tiniest bits, then there is no room for any uncertainties in the world. The question that became the basis of the famous “Butterfly Effect” was as follows:
Does the flap of a butterfly’s wings in Brazil set off a tornado in Texas?
His question was later proved when he tried to simulate weather patterns using 12 predetermined variables. On one of the iterations, he made a small adjustment by rounding up one variable into certain significant numbers. It was later found that such tiny alteration could give a completely different result from his previous runs. This outcome certainly plays a defining moment in mathematics and science when it comes to understanding how nature works, as outcomes are sensitively dependent on the initial condition. He then worked on these findings and eventually, the name “Butterfly Effect“ soared and became a phenomenon in science and culture.
In respect to Lorentz’s question, the idea behind this scientific breakthrough is similarly applicable when we are running a business. Small gestures that an organization can do may have a huge impact waiting around the corner for better or worse. Dollar Shave Club once made a slapstick video to promote their product. In the video, the actor was promoting Dollar Shave Club with a touch of humor, making viewers feel related, which then forged emotional bonds between customers and the brand. The video gained so much traction and popularity ever since. Five years later, Unilever acquired the company for $1 billion, making such acquisition a high pitch for an e-commerce company back then. What Dollar Shave Club did was only flapping its wing, but it brought them an immense value of money.
From that story, it is apparent that businesses can do little things that may lead to a much greater impact. As a matter of fact, if one can list down all the small gestures that businesses can offer, the list may go far beyond. Those gestures could be in the form of offering price cut-offs (e.g. promo, discount, rebate, cashback, etc.), recommendations, and notifications for cross-selling or up-selling, offering membership programs with its vast benefits, introducing product updates, etc. However, out of all those measures, some may fail to recall that there is one part within the body of the organization that is responsible for giving these kinds of small gestures 24/7: the customer service.
Everyday, customer support representatives are readily available to help and support their customers for every issue that they encounter. They are the frontline that ensures all customers can have a seamless experience in using the offered products and/or services. If somehow a customer service fails to deliver these small gestures (i.e.: failing to help customers in resolving the issue), it would certainly leave a bad impression on customers, resulting in a ripple effect that will play in motion: losing trust, leaving a bad reputation for the brand, and eventually losing its customers.
In fact, Oracle once mentioned that 89% of customers churn and use other brands offering similar products and/or services due to low quality of customer service experience. As customer experience begins to gain traction in current business warfare, it is certain that customer service acts as the penultimate strategy to retain customers.
Churn rate among complaining customers: a manifestation of seeing the butterfly effect playing in motion
As mentioned by Oracle above, it can be inferred that bad customer service experience will encourage customers to churn. For everyone working at a contact center, churn needs to be understood by heart as it can imply numerous insights to further understand the customers and their unmet needs, hence creating an opportunity to leverage customer experience.
Investopedia mentioned that churn rate is the percentage of customers who stop doing business with an entity. Applying the definition to our case simply defines the churn rate as the number of users who stop using Tokopedia at a given amount of time.
An article by Clevertap stated that there are many factors at play that cause a user to churn. However, if summarized, the reasons why users are churning out are mainly due to the following:
- Cost
- Poor experience (onboarding, UI/UX)
- Lack of features
- Competitor products
- Poor product/market fit
- Lost value perception of the app/platform
From those excerpts, it can be implied that poor service experience may cause customers to lose trust in the brand, hence impacting the loss of value perception, which eventually leads to customers stopping their use of a brand’s product/service. Nevertheless, understanding the churn rate may offer a better insight and understanding, especially among dissatisfied customers filing a complaint.
Simply put, we can imagine people who submit their complaints as our best friends. As best friends, they won’t hesitate to warn us from any of our wrongdoings. However, if we neglect their warnings or respond unaccordingly, they won’t hesitate to leave us. Such an idea makes the foundation of how our customers are truly our best friends. Customers have the good intention to address their issues and remind us of what we should have done before really leaving us if no good intention is received back. This is also reflected by the numbers. An internal study shows that when churn is analyzed by comparing among those who filed complaints and the overall population, it shows that the churn rate remains lower among those who filed complaints.
Changing the way we flap the wings
Tokopedia Care who is always responsible for handling all customer interactions believes that customers are always at the center of our business activities. Therefore, we are always putting our maximum effort to help our customers. The efforts and promises are reflected in our service vision as we always strive to become our users’ best friend, who is reliable by not only giving the best service experience, but also creating opportunities, and growing together with Tokopedia. The notion is also supported by one of the company’s DNAs: Focus on Consumer.
However, for us to truly live the idea, we faced an immense challenge. As Tokopedia business grows, so does the number of customer interactions. With such an enormous interaction, the traditional approach in customer servicing is no longer relevant. Continuing those approaches might hinder us in giving the small gestures for fulfilling our customers’ needs, hence resulting in an ominous impact on the business. There was one moment that has become our wake up call up to this day, where we received unpleasant feedback from customers due to the provided service.
This resulted in the poor performance of our metrics, such as customer satisfaction score, response time, the quality score for our CFS (Customer-First Squad — it’s what we call our Customer Service Representatives), etc. At that time, we were fully aware of the greater cost that may continue to cripple if such condition was just left unchanged: customers churning out from the platform. When churn was measured among those filing a complaint, the finding shocked everyone as it acts as the moment of truth. On the other hand, it also gave a new yet different perspective as we need to foster a deeper and better relationship with our best friend, that is the complaining customers.
In his weather pattern experiment, Lorentz was making small alterations on the initial condition that drastically changed the result of his calculation. For us at Tokopedia Care, we were trying to implement the same thing as what Lorentz did: trying to fix the small gestures that we give without significantly altering the business process, hoping for us to have a more positive outcome in the future. We did that by building a strategy to regain trust and loyalty.
Those who are familiar with Sun Tzu’s “The Art of War” must have heard one chapter that specifically addressed the importance of attacking by stratagem. He mentioned that a battle plan is needed for someone to win the war without having to lose many of their resources. Applying this in our case means that we need to lay out a plan to win the customer’s heart. The strategy caters from how we can fix the basics and meet customer’s expectations to level up the interaction and become emotionally connected to them, as summarized in the following figure:
This strategy is further laid out to several action plans, including the following:
- Understanding what went wrong: this acts as the first step in understanding more about the report card given by our customers. Countless surveys and interviews were rolled out to our users’ and numerous data points were connected as we tried to fully capture the experience of using our platform up to its tiniest journey. We also rolled out surveys and interviews to our internal team members, including our CFS, to gather some feedback and insights from those who are always on the frontline. The results are then used to formulate recommendations to answer all of our users’ needs and pain points.
- Work to close the gap: after gathering several insights, the team rolled out some works to solve customer’s pain points and have new solutions introduced, including some of our automation (i.e. automatic email reply system, chatbot, etc.). This automated system will place the new frontline to elevate customer experience due to its capability in handling the enormous interactions coming to Tokopedia Care. What makes it more appealing is that it also enables us to promote our live customer care representatives as they are able to solve more complex problems
- Tie the knot with our customers: when the gap is already closed, it needs to be sealed in order to avoid it to keep it leaking and reopening. A special touch was formulated in order for us to do so. A brand new social media engagement strategy was introduced, allowing users to be more engaged with Tokopedia Care social media instead of only reaching the account to address complaints. A Customer Engagement Hub is also built to capture all of the users’ voices across channels and connect the dots with our internal performance, enabling the team to act proactively to avoid further spike on certain issues. We also introduced our “special gestures” that allow customers to feel more connected to us, hence enlivening our service vision to become our user’s best friends. The presence of Service Recovery at Tokopedia Care allows users who have a bad experience and/or service failure to be “recovered”, turning their dissatisfaction into satisfaction, while at the same time extending and strengthening the bond between those users and the platform, turning them into our promoters as the end goal. Projects like delivering an extra mile service during special moments (i.e. in commemoration of national consumer day, valentine day, etc.) were also rolled out with the aim of helping users cherish their special moments with their closest ones, leaving a lasting impression that Tokopedia Care truly cares for our customers.
After executing a series of improvements, it began to show some fruitful results. The most important thing is that the positive results are not only mirrored on the metrics that we monitor on a daily basis but also leaving a good impression among our users, indicated by the positive sentiments given at the interaction channels and social media.
Furthermore, when churn was recalculated, the decline blew everyone’s mind. After making improvements in two years’ time, churn among users who file a complaint at Tokopedia Care was able to be reduced by more than a-third both from those who left good marks and bad marks. The “special gesture” given from activities like Service Recovery and special Moments also succeeded in boosting user’s loyalty, indicated by more than half of users receiving such treatments transacting more frequently at our platform.
The small thing that matters: an epitome
It is apparent that even the slightest thing like helping customers solving their issue matters when it comes to running a business. Failure or negligence of it may cost a business dollars as users won’t hesitate to churn out. Enlivening the DNA of Focus on Consumers, everyone at Tokopedia Care is putting the maximum effort to always help our customers, being their reliable best friend, and grow together. Continuous research, iterations, and innovations are always made to elevate customer experience, making harmony to the slightest thing that will eventually bring merits and virtue towards the platform.
