Salon trims costs with hosted apps

Salon chain Ulta has given its customer-service operations a makeover and managed to slash support costs by one-third in the process. Key to its new operations are hosted call routing and CRM technologies.

Gone are the days of having a company operator perform switchboard operations and track help desk requests with a spreadsheet, says Ron Brown, director of service and communications at Ulta, which has 160 stores in 21 states. In the past, “phone routing was literally managed by a receptionist at our corporate office. Every guest call that came in went through her,” Brown says. Meanwhile, a third-party provider handled customer queries that came in via the Web site, and Ulta had little to do with those contacts. “We really weren’t able to manage those contacts with the intimacy that we would have liked,” he says.

He set out to unify Ulta’s CRM efforts and find a way to handle the Romeoville, Ill., company’s phone inquiries more efficiently. Brown settled on hosted call-routing technology from Echopass and a hosted CRM application from RightNow Technologies, both of which Ulta implemented last spring.

Brown considered deploying call-routing and customer self-service technologies in-house, but quickly ruled out that option because of its expense. “It was quite prohibitive,” he says.

The Echopass platform handles computer telephony and automatic call distribution for traditional landline and VoIP calls. Echopass embeds Genesys Telecommunications’ routing technologies into its platform, which it operates from a Salt Lake City data center.

RightNow’s software provides the interface for Ulta’s help desk agents, who field calls routed by the Echopass platform and Web-based inquiries. The RightNow software also serves as a repository for customer-service resources, which Web site visitors can access on their own. For example, online FAQs address common customer inquiries, such as the store’s return policies. A portion of the FAQs, available only to Ulta employees, addresses topics that store managers care about, such as IT, human resources issues and loss prevention. A lot of that data has been documented and distributed to retail staff, but making it available and searchable online is more convenient for store employees, Brown says.

For management, the RightNow software lets Brown record and track the incidents and inquiries that come into Ulta’s support center. “Previously, we were just recording everything in an Excel spreadsheet, which is a pretty laborious, pretty archaic way to do it,” he says. Reporting features built into the Echopass platform track call volumes and help Ulta coordinate staffing requirements.

With nearly one year of data accumulated, Brown says he will have a better handle on seasonal demands. “I can get a very accurate sense of what to expect for the next holiday season, for example, so that we are staffed appropriately,” he says. “That’s been a big benefit that I’ve seen so far.”

Ulta has been able to reduce its staffing and outsourcing costs because of the new systems. It no longer uses a third-party firm for handling Web response, for example, which dropped its labor expenses by one-third.

At the same time, customer service has improved, Brown says. Call-wait queues have dropped from 3.5 minutes on average to 45 seconds. The number of customers who hang up before being served has dropped from 25% to 7%.

The self-service features from RightNow have helped deflect a significant number of inquiries to online channels. As a result, Ulta can offer longer call-center hours despite having fewer staff members, Brown says. Ulta’s in-house support agents are spending less time on routine queries and more time on higher-level inquiries, he says.

Looking ahead, Brown will consider deploying some of the features he’s not yet using from Echopass. For example, the Echopass platform can do skills-based routing, but Ulta so far hasn’t trained its support agents to specialize in particular areas. Ulta may go in that direction if reporting tools reveal areas where it makes sense to have specialized agents – such as a significant number of calls related to the salon’s rewards program.

Likewise, all of Ulta’s agents today work from a single location, but the salon also may explore using distributed agents to take calls in the future, Brown says.