Priceline.com Inc., the online travel service, has bet its business model on the fact that Web-savvy customers like to help themselves - in this case, to deals on airfare, hotels, car rentals and the like. The Norwalk, Conn.-based company has extended that model to its customer service operations, adopting an e-service strategy to complement its telephone-based call center. If customers run into trouble during a travel search, they're encouraged to try self-service or e-mail options - more cost-effective ways to handle services issues - before resorting to a phone call.

Like Priceline.com, companies everywhere are leveraging e-service technologies - Web self-service, chat, e-mail response management, collaboration tools, remote diagnostics - as an alternative to the phone for interacting with customers. One reason is that customers today want the additional channel options that e-service offers them. According to a 2005 survey from Wellesley, Mass.-based Service Excellence Research Group LLC (ServiceXRG), 60% of high-tech customers attempt to solve their own problems through self-service knowledge bases before trying interactive channels.

Some vertical industries have been leveraging e-service technologies for some time, and cost reduction has been the primary driver. Conventional wisdom says you can push customers from the phone to lower-cost channels and watch service-delivery expenses drop. However, companies are finding that customer service doesn't conform to such a simple paradigm. To be effective, e-service deployments require considerable investments of time and money -- in knowledge-base creation and maintenance, sophisticated search technologies, incident tracking and workflow tools, and channel integration -- so customers get the same experience regardless of how they contact providers. So although the cost benefits that can result from e-service initiatives have not declined, businesses are increasingly looking at other reasons to justify investments.

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