From cell phones to home mortgages to retail outlets, consumers have a wealth of choices. Yet, the market is flooded with products and services that have become commodities, or are perceived by prospective customers as commodities. This "commoditization of everything" is driving businesses to seek alternative ways to stand out. When the goods themselves don't stand out in a customer's mind, how do vendors make their mark? Consumers may not be able to differentiate between multiple service providers but they know they want to do business with the one that will treat them right-a vendor who will value their time and make the service experience as smooth as possible.

Investment services are a great example of this. The differences between investment products are lost on the average consumer. Most people can't really discern the difference between retirement services so they look to how well they are treated and the level of service to determine which provider to select. In fact, Mangen Research Associates found that a company's degree of customer focus was the most important purchase decision factor for customers, by a very wide margin.

Likewise, the wireless market is facing this same conundrum. For a long time wireless vendors could compete on network performance, but soon carriers will reach a certain level of parity with their network capabilities-and consumers have already gained the ability for local number portability. These two forces combined are requiring wireless carriers to focus on customer service to differentiate themselves. Ultimately, businesses need to not only acquire new customers but increase customer retention. A mere one percent increase in customer loyalty can generate a 25 percent increase in profits, according to research by Bain and Company. Traditional CRM technology has failed to keep up with the volume and variety of service channels organizations must manage to increase satisfaction and cultivate loyalty.

Common service challenges

Technology has made it easy to consolidate large volumes of information and share this with customers and customer service agents. Yet simply delivering this information without parsing it does little more than frustrate customers and confuse agents. This is a common complaint among users of vendor's FAQs and knowledge bases. They must spent an inordinate amount of time scanning multiple, randomly presented hits to find an answer. If the information presented doesn't match what is provided through other support channels, customers quickly become frustrated. Moreover, agents themselves often must wade through a confusing array of information to respond to customer needs.