Sealing in customer loyalty

Neha Kapoor

THE e-commerce market is down. Online business has taken a beating even before it really took off. Customers have lost faith in the `Internet economy,' and e-commerce trading companies across various industries are finding it difficult to attract and retain customers.

Regaining lost trust, then, is the first step that needs to be taken by any company looking to leverage the Web to augment overall growth.

And independent audits of business processes and adequate disclosure assuring customers of a company's ``good intentions'' is just what the doctor prescribes in such a scenario. Needless to say, a good many global consultancies are standing at hand to offer such services.

It's all on the Web

PricewaterhouseCoopers's (PwC) Global Risk Management Services and KPMG's Information Risk Management division are two such examples. PWC offers its suite of services under the ``Betterweb'' umbrella and KPMG issues a ``Web Seal'' following a ``rigorous'' audit.

``We initially started out by issuing a Betterweb Seal that would be displayed on a client's Web site, authenticating their business processes. Surfers could click on this seal and look into company information that has been audited by us,'' says Amit Dutta, Associate Director, Operational & Systems Risk Management, PwC.

``Given the shakeout in the B2C market, we have now modified our services to focus more on the B2B segment across all industries. So, now the Betterweb programme, without the seal, is offered to companies as a disclosure consultancy service,'' says Dutta.

``Through Betterweb, we help clients to figure out how best to carry out disclosures on Web sites in four top areas -- sales terms, privacy, security and customer complaints,'' says Nikhil Donde, Consultant, Global Risk Management Services, PwC.

This entails a four-step procedure:

Web site Disclosure Analysis and recommendations

Web site Assessment that provides prioritised recommendation to better engage customers

Customer Contact Analysis and,

E-business Diagnostic which determines whether e-business efforts address associated risks, measure up to industry-best practices.

KPMG's Web Seal, on the other hand, is a representation of an image or logo on a client's Web site to indicate that some independent opinion is being offered on some aspects of the client's operations. ``The seal offers an assurance level by an independent auditor about certain practices followed by a particular company in view of industry-best practices,'' says Sanjay Dhawan, Executive Director, Information Risk Management, KPMG. ``And the service is offered to all e-commerce trading companies without any differentiation.''

``The Web Seal can be issued on various aspects, including management's assertions, internal controls, information processing, privacy, security, Web page hits or agreed-upon procedures,'' he adds.

Target users

``Due to the new and complex nature of online customer relationships and related economic results, many companies do not know exactly where they stand regarding customer profitability,'' says the Betterweb brochure. It adds, ``you have to know the cost of customer acquisition, whether your margins are better or worse online, what is the rate of conversion of browsers to buyers and buyers to loyal customers, and also, what is the cost/benefit of adding online customer services.''

Both PWC and KPMG have zeroed in on the following as the most prominent users of these services:

Brick-n-mortar companies using the Web as an added channel of sales and distribution.

Infomediaries selling content on the Internet.

Companies carrying out financial transactions online.

Web sites carrying sensitive information.

Sites carrying confidential customer information.

Promise of delivery

``There have been a lot of cases in the US and Europe where customers have not transacted online for lack of authenticity and proper disclosures,'' says Donde.

``According to a recent Forrester Research study `Financial Web sites Underserve Consumers,' despite the fact that most sites engage in analysis of `usability,' they do not reflect customer goals and needs, customer service is not woven into the site and they lack guided search functionality.

``Also, 43 per cent of customers failed to complete an attempted online purchase last year. Of those, 45 per cent ditched Web sites with confusing content or poor navigability,'' he adds.

PwC claims to build customer confidence in conducting business online, identify opportunities to build loyal, repeat customer relationships and improve online relationships.

Dutta says, ``the key to attracting and retaining customers is to build a more trustworthy business and our clients' businesses have benefited through our services because of suitable display of information and policies.''

According to Dhawan, ``Today, things aren't exactly rosy in the e-commerce markets and it is difficult to attract customers and build loyalty. An independent assessment of business models and processes can, in fact, act as a catalyst to revive the markets.''

He, however, warns that such ``seals'' and authentication programmes should not be taken as a blanket comfort by customers. ``These programmes look into certain aspects of clients' businesses and are aimed at increasing customer comfort about these areas only. They should not be treated as an overall blanket comfort for other areas of the client's business.''

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