Should You PROACTIVELY Contact and Service Your Customer AFTER the Sale?

CHALLENGE:
Should you take the initiative and contact your customers to provide service after the sale or, should you leave well enough alone, be satisfied with the sale and if necessary, excel in “service recovery” when you fail? The answer is it depends.

How they researched it:
Post-sales activities can include helping customers use products, perform maintenance on purchased products, provide spare parts, etc. In this case, we are not including selling complementary products or service as part of post-sales activities. Professors Goutam Challagala, R. Venkatesh, and Ajay K. Kohli interviewed 94 managers from a variety of businesses, including B2B, B2C, service, and manufacturing firms in a focus group format. Note that this methodology constrains the research to posit hypotheses; generalizable conclusions are not possible. They compared proactive post-sales service (PPS) to reactive post-sales service (RPS) to see if PPS resulted in important strategic benefits to the seller. They asked the managers to identify how the seller might initiate customer contact to deliver PPS as opposed to the customer initiating contact for RPS, the consequences of the alternative philosophies, and the conditions when PPS may be more important.

What happened?
The researchers categorized PPS activities into three types: prevention, education, and feedback seeking. They concluded that proactive prevention, such as a real estate agent sending a reminder to file for homestead at tax time, can lead to great customer satisfaction and willingness to adopt new offerings from the seller. Further, proactive education, such as annual calls on customers to determine if there are latent dissatisfaction issues, can lead to greater product knowledge, usage and satisfaction on the part of the customer. Finally, proactive feedback seeking, such as informing customers of warranty privileges or expiration and asking about product or service results, can lead to the customer feeling they have greater “voice” in the purchase, leading to greater satisfaction.

But the value of PPS over RPS varies with customer characteristics and product/service characteristics. The researchers suggest proactive prevention and feedback seeking are more likely to lead to customer satisfaction when the customers are heavy users. This is because heavy users are more likely to suffer losses when things don’t work as expected and appreciate your acknowledgement of their heavy user value. Proactive prevention are less likely to be valued by heavy users because they are more user-educated. Importantly, sellers are more likely to extract greater value from PPS with heavy users because this customer group is more likely to generate ideas for new product/service ideas.

The researchers suggest that proactive prevention and education are more likely to lead to customer satisfaction if the focal product/service is in the intermediate or growth stage of its life cycle. When product/services are new, the types of customers attracted are those who are more venturesome and comfortable with early model glitches. By the time growth stage occurs, less venturesome and less tolerant customers come into the market, and they are in greater need for proactive support. When the product/service is new, proactive feedback seeking is expected to be more appreciated because the typical innovative buyer will be pleased to share their insights into a new product/service. Further, the seller is likely to benefit greater from feedback seeking when the product/service is newly introduced because the innovative customer is more likely to provide useful ideas for improvements and new products/services.

Finally, the transaction-extensiveness associated with the product/service will affect the customer satisfaction result. Some purchase situations, such as is typically found with services have greater and/or more frequent interactions between customers and the seller. The researchers believe that lower transaction extensiveness, such as is typically found with products, will lead to greater customer satisfaction when using proactive prevention, education, and feedback seeking. The reasoning is that low transaction purchase situations have inherently lower contact, customers are less likely to expect much contact nor know who to contact in case of trouble, and consequently, customer are going to be more appreciative when contacted.

How can you help?
Comment back on your REAL experiences. The above research findings are based on a limited sample in a focus group setting. Share your experience-based insights.

Goutam Challagalla, R. Vankatesh, and Ajay K. Kohli (2009), “Proactive Postsales Service: When and Why Does it Pay Off?” Journal of Marketing, Vol 73, March, 70-87.