Subscription commerce startup is early adopter of Flamingo VRM
A Sydney fashion e-commerce startup has targeted customer retention by becoming an early adopter of the Flamingo vendor relationship management (VRM) platform.
Flamingo is cloud-based software launched today by Catriona Wallace, who is also the managing director of management consulting firm Fifth Quadrant.
The software is meant to aid businesses in their retention efforts by connecting the business and customer in a “co-creation laboratory” in which customers can customise how they interact with the company, what they’re looking for in the product, and other elements of the customer service experience.
The process, which involves live chat and survey questions, takes five to 10 minutes and can actually halve the amount of money spent on customer retention, claimed Wallace. A typical customer retention process at a telco can cost $600; the same as it costs to acquire the customer in the first place, she said.
Her Fashion Box, which has built a subscription business around personalisation, is one of Flamingo’s first customers. Customers pay a monthly rate to receive by post boxes of fashion accessories, with the contents of each box customised for the individual user.
While the startup had always allowed customers to set up a personalised experience when they sign up, the company had no data on why some customers decided to cancel their subscriptions, according to Her Fashion Box founder Kath Purkis.
"A churn rate for a subscription commerce company is a really big deal,” she said at a Flamingo launch event today in Sydney. “Just altering that by 5 per cent completely changes our bottom line.”
In addition, the success of the business hinges on satisfied customers, she said. “I’d rather have 100 or 1000 happy customers as opposed to 3000 and a few unsubscribe and we know nothing about their preferences.”
At first, Her Fashion Box tried displaying a pop-up survey at the end of the unsubscribe process, but this provided minimal insights, she said. “We didn’t really learn too much about the customer.”
For the last few months, Her Fashion Box has used Flamingo to reach out to people who have unsubscribed and learn how they might do better. The company has not yet tried to win back the customers, but plans to talk to each person again individually once it has fully analysed the data, said Purkis.
Unlike a traditional survey, the Flamingo platform connects live employees with customers via chat while the customer answers questions about how to improve the experience. Purkis said she has trained five staff members to use the platform and combined they have interacted with nearly 600 former customers.
The platform is “giving us a leg up on any of our competitors both locally and internationally and giving us an opportunity to actually talk to our customers in an interactive way and find out what their qualms were.”
In addition to startups, Flamingo hopes to sign up larger enterprise and government customers. Wallace said the company has won the interest of several government agencies as well as an insurance company and a utility.
In a demo, Flamingo showed how a telco might use the platform to adjust a user’s mobile plan. The customer was able to adjust sliders for how many voice minutes and how much data they wanted per month, and the software automatically updated the price of the plan supporting that.
Doc Searls, the creator of ProjectVRM at Harvard University’s Berkman Center for Internet and Society, said services like Flamingo reflect a return to businesses acting as agents for the customers.
“There really is no interaction between CRM and the actual customers,” he said. “It’s mostly about sales. It’s not about retention.”
“The reason Salesforce is called Salesforce is because they’re about sales. It’s not because they’re about customer service. No knock on them – the idea behind CRM was a good one but it was a one-sided idea.”
“We need something by which the voice of the customer gets heard and gets respected.”
Adam Bender covers telco and enterprise tech issues for Computerworld and is the author of a dystopian novel about surveillance. Follow him on Twitter: @WatchAdam
Follow Computerworld Australia on Twitter: @ComputerworldAU, or take part in the Computerworld conversation on LinkedIn: Computerworld Australia
In the third and final episode of our 3-part CMO50 video series exploring modern marketing and why it’s become a matter of trust, we’re delighted to be joined by Telstra’s former CMO and now digital services and sales executive, Jeremy Nicholas, and Adobe VP Marketing Asia-Pacific and Japan, Duncan Egan.
Flash back to the classic film, Willy Wonka and the Chocolate Factory. Television-obsessed Mike insists on becoming the first person to be ‘sent by Wonkavision’, dematerialising on one end, pixel by pixel, and materialising in another space. His cinematic dreams are realised thanks to rash decisions as he is shrunken down to fit the digital universe, followed by a trip to the taffy puller to return to normal size.
Why is it there is no shortage of leadership development materials, yet outstanding leadership is so rare? Despite having access to so many leadership principles, tools, systems and processes, why is it so hard to develop and improve as a leader?
As a nation united by sport, brands are beginning to learn money alone won’t talk without aligned values and action. If recent events with major leagues and their players have shown us anything, it’s the next generation of athletes are standing by what they believe in – and they won’t let their values be superseded by money.
