Owned and Operated Podcast Episode #153: AI In Customer Service with Hatch and Chris Bache

Podcast Information:

• Title: Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast
• Host/Author: John Wilson and Jack Carr
• Episode Title: AI In Customer Service with Hatch and Chris Bache
• Release Date: November 26, 2024

Introduction

In episode #153 of Owned and Operated, hosts John Wilson and Jack Carr delve into the pivotal role of Artificial Intelligence (AI) in enhancing customer service within home service businesses. Their guest, Chris Bache from Hatch, shares invaluable insights on building an effective rehash program, optimizing customer communication, and leveraging AI to drive business growth.

Guest Background: Chris Bache and Hatch

Chris Bache provides a comprehensive overview of his journey in sales and marketing, leading to the founding of Hatch. Initially a "sales for hire" company, Hatch evolved into a software platform addressing the unique needs of home service businesses. With over 2,000 businesses and more than 10,000 users, Hatch has become indispensable for companies aiming to scale efficiently by automating customer interactions and optimizing lead management.

“[...] we really are the AI platform for CSRs that want to do rehash, speed to lead, confirmations, and sort of figure out how to automate a lot of that and make sure that humans are having the right conversations with the right customers that are going to increase the bottom line for these businesses.”
— Chris Bache [01:48]

Understanding the Rehash Program

A significant portion of the discussion centers on the rehash program, a strategic approach to re-engage unsold estimates and optimize lead conversion. John Wilson emphasizes the importance of initiating a rehash system early in a business's lifecycle to maintain continuous growth.

Key Components of a Successful Rehash Program:

1. People: Involving the right personnel, such as sales managers and Customer Service Representatives (CSRs), to oversee and execute the rehash process.
2. Process: Establishing a clear, repeatable workflow that defines timely follow-ups (ideally within 24-48 hours) to maximize lead conversion.
3. Technology: Utilizing software like Hatch to automate and streamline customer interactions, ensuring consistent and effective communication.

“I think people that need to be involved is, you know, a manager that sort of owns the idea of improving close rates.”
— Chris Bache [04:31]

Effective Messaging Strategies

The conversation highlights the critical role of content and timing in messaging. Chris shares data-driven insights on optimal communication practices that significantly boost response rates.

Best Practices Highlighted:

• Timeliness: Sending the first message as soon as possible after the initial customer interaction. While response rates are higher within an hour, even responses within 24 hours are effective.
• Message Length and Clarity: Short, direct messages outperform longer, more embellished texts. Personalization and clarity about the purpose of the message enhance engagement.
• Omnichannel Approach: Combining phone calls, text messages, and emails within a seven-day window increases overall engagement rates, sometimes reaching up to 90%.

“There is a strong push [...] if you start a conversation and say, hey, we see it and move forward, we like to talk to you about if price is an issue, we'd like to talk to you about your experience. [...] response rate's like 90%.”
— Chris Bache [10:55]

AI Integration in Customer Service

A significant focus is placed on the integration of AI in customer service operations. Chris elaborates on how Hatch leverages AI to enhance efficiency and effectiveness in handling customer interactions.

AI Capabilities Discussed:

• Sentiment Detection: AI analyzes customer emotions to tailor responses appropriately.
• Automated Responses: Handling routine inquiries and qualifying leads, freeing human agents to focus on more complex interactions.
• Data Utilization: AI accesses unstructured data from CRMs to provide informed, context-aware responses.

“I'm calling it like a level 1 CSR or ISR where AI can do a lot of that work. The Humans can spend more time in like the valuable conversations.”
— Chris Bache [18:51]

Human-in-the-Loop Approach: Hatch employs a hybrid model where AI handles initial interactions, and human agents take over when conversations require deeper engagement or negotiation.

“25% of all of our AI conversations, no humans involved. 75% they're involved. [...] part of the intent is to sort of transfer upon some sort of rule.”
— Chris Bache [20:05]

Compliance and Regulatory Considerations

As AI-driven communications expand, so do regulatory requirements. The hosts discuss upcoming legislation and best practices to ensure compliance, particularly concerning SMS marketing.

Key Compliance Strategies:

• Opt-In Lists: Building and maintaining lists where customers have explicitly consented to receive communications.
• Clear Intent: Ensuring messages clearly state the sender’s identity and purpose.
• State-Specific Regulations: Adhering to varying state laws regarding permissible communication content and methods.

“Helping customers build an opt-in list is huge on the roadmap for us because we want it so that you can constantly use SMS to communicate with customers and they're just going to have to opt in and that's the laws that are coming.”
— Chris Bache [16:17]

Additional Use Cases for Automated Communication

Beyond rehash programs, Hatch's platform supports diverse applications of automated communication to further streamline operations.

Highlighted Use Cases:

• Accounts Receivable (AR) Collections: Automating follow-ups on outstanding balances to expedite cash flow.
• Recruitment: Engaging potential candidates efficiently, although this was noted as challenging in certain scenarios.
• Project Updates: Keeping customers informed about project timelines and progress to reduce inbound call volumes.

“Another good use case I've seen, which is interesting, which is like recruiting. They have lists of [...] see if they're open for a job.”
— Chris Bache [23:06]

Lessons Learned and Key Takeaways

The episode underscores the importance of early implementation of rehash systems to embed growth optimization into a business’s DNA from the outset. Chris advises businesses to:

1. Start Rehash Programs Early: Integrate rehash processes when annual revenues are around $3 million rather than waiting until they reach $6-20 million.
2. Build the Muscle: Consistent, disciplined execution of rehash strategies ensures sustained high close rates and prevents growth plateaus.
3. Leverage Technology Wisely: Utilize AI to handle routine tasks, allowing human agents to focus on high-impact conversations.

“If he could start sort of the rehash optimization at $3 million instead of at $6 million, he would have.”
— Chris Bache [25:11]

Conclusion

Episode #153 of Owned and Operated provides a deep dive into the transformative impact of AI on customer service within the home service industry. Through Chris Bache's expertise, listeners gain actionable strategies for building effective rehash programs, optimizing communication through data-driven messaging, and navigating the complexities of AI integration and compliance. The episode reinforces the notion that embracing AI and early rehash implementation can lead to significant growth and operational efficiency for contractors and service-based businesses.

For more information or to explore Hatch’s solutions, visit usehatchapp.com or find them on the ServiceTitan Marketplace.

Notable Quotes:

• Chris Bache [04:31]: “I think people that need to be involved is, you know, a manager that sort of owns the idea of improving close rates.”

• Chris Bache [10:55]: “There is a strong push [...] response rate's like 90%.”

• Chris Bache [16:17]: “Helping customers build an opt-in list is huge on the roadmap for us…”

• Chris Bache [25:11]: “If he could start sort of the rehash optimization at $3 million instead of at $6 million, he would have.”

This episode is a must-listen for home service business owners seeking to harness AI's potential to enhance customer service, optimize lead conversion, and drive sustainable growth.