Updated: Apr 29
Price is not the main reason for customer churn; it is actually due to the overall poor quality of customer service.
In this era of online communications, people now have the power to broadcast their experiences and opinions to potentially millions of others. Social media can be the make or break of a business, and every one of your customers is likely to have a contributing voice. Because of this, no matter your industry, nothing will ever replace customer service as the most important aspect of customer retention and management.
So, how you successfully operate a business in the age of instant gratification and keep your customers both satisfied and loyal?
Why invest in good customer service?
You can offer promotions and slash prices to bring in as many new customers as you want, but unless you can get some of those customers to come back, your business won't be profitable for long. At its core, good customer service is about building relationships - with the difference being what you do, not just what you say or how slick your brand looks. The aim is to make sure that not only do your customers return and purchase more from your business, more often – but pass great feedback to others about it.
Whether that’s by old-school word-of-mouth or a public review on social media or feedback platform, a happy customer is likely to tell nine people about a positive experience, whereas a negative experience is something they’re likely to pass on to 16 people. When you consider today’s instantaneous communication, it becomes even more important to invest in team training and strategic initiatives to boost service levels and customer experiences: it’s good for your customers, but it most benefits you and your bottom line.
· The probability of selling to an existing happy customer is up to 14x higher than the probability of selling to a new customer
Businesses that grow their customer retention rates by as little as 5% typically see profit increases ranging from 25% to 95%
More than ever before, today’s customer service needs to be tailored and specific – but it needs to be fast. The way we define speed has been ever-increasing: we used to be impressed with goods purchased over the internet being delivered in weeks, but recent advancements to drone technology led by Amazon are paving the way for deliveries to be made in mere hours, or even less. This expectation isn’t limited to goods and services, though: it applies to the speed of response they expect from a business regarding issues they raise and queries they have. Responding in 24 hours can now feel like a lifetime – so ensure your timeframes for response are at least in line with what the typical customer would expect of your industry. Similarly, since the uptake of mobile technologies, most companies benefit from having extended service hours. This can often help meet customer demand for shorter response times to critical and non-critical issues alike.
Customers also now expect accuracy. Ensure details of what products you have in stock, or approximate delivery dates, are correct. With technological and process advancements, customers are now accustomed to these details being right. However, customers are more willing than ever to participate in the service process – from typing in their own contact details for delivery or using the supermarket self-checkout lanes to speed up the process.
Money-wise, it’s worthwhile giving a money back guarantee – as customers today see this as standing by the quality of your product or service., and it could mean the edge over your competitors. If you sell products, be aware that these days customers dislike shipping and other ‘hidden’ fees that are calculated and added at checkout – even if well-intentioned, it can seem sneaky.
The other change in customer service trends is about how you make the customer feel. Customers dislike overly scripted service, and in huge mass markets, crave authenticity and tailored service. You should make them feel like they’re important to you, and like their business specifically is integral to yours – after all, it actually is.
The complaints opportunity
Complaints can be make-or-break for a customer to continue their relationship with your business, so the consequences are significant if you don’t treat them seriously.
For every complaint your business receives, there will be approximately 26 unhappy customers who have chosen to stay silent. This means that people having bad experiences, they don’t tell you, they won’t be coming back to do business with you and they’re likely letting a number of their friends know. However, the one customer who does complain is giving you a valuable gift: information on what is likely making many more customers unhappy – and therefore the opportunity to proactively do something about it! All of this is precisely why you should do the counterintuitive thing in encouraging customers to complain and also provide an easy way for them to give their feedback.
Complaints identity faulty products and issues with service. If your customers don’t make you aware of a problem with a product, you won’t be able to fix other products that may have the same problem. Likewise, if an employee is rude answering the phone, the business can’t take steps to address the problem if someone doesn’t take the time to let them know about it.
Customer complaints can challenge the way things are done within a business: they can help identify ways to take a business to the next level. They can be a reality check for organisations and help them identify ways to grow, develop and improve. Successful organisations often have very structured and fine-tuned complaint management processes – but even when it comes to these businesses, the only way to test those processes is to use them. A complaint, and the management of complaint handling, is a test to the system: it can test the customer service skills of trained employees and identify weak areas for future training.
It’s important to shift your thinking when it comes to customer complaints: it’s time to embrace them and welcome them as the opportunities they are to do better, and turn unhappy customers into satisfied, loyal ones.
Going above and beyond: tips for small businesses
Make sure it’s a real human people talk to when your business phone is answered – not a recorded message or robot – people expect personalised service from a polite, real person willing to listen to and understand them.
Keep all the promises you make – these are both what you claim on your website and social, as well as to customers in emails and over the phone. Nothing is worse than a business failing to meet expectations, and it will quickly turn customers away, but this is also an opportunity to go above and beyond. If you say you’ll deliver a shipment on Tuesday, deliver the shipment by Tuesday – or earlier.
Listen to your customers – always! Nothing is more frustrating than having to re-explain or reiterate points because the person on the other end of the phone or email isn’t listening. Cut the sales pitches and actively find out where your business can help them – proactively solve their problems and provide suggestions that are genuinely useful.
Prioritise your complaints, and further to the points made above, use them as opportunities to improve products, service and processes.
Always be helpful – even when it isn’t directly making you money. If you help a customer when nothing is in it for you, think of all the people they’ll tell the positive story to!
Train your staff, and train them well – they should be courteous, helpful and knowledgeable. Equip them with the skills and information to be able to quickly and effectively solve common problems for your customers.
Throw in something extra for them – entice them to come back and do business with you again. Whether this is an opportunity for on-time payment discounts, a coupon, the opportunity to join a great loyalty programme or just a genuine smile – people love getting more than they thought they were going to. The smallest gestures can sometimes be the most appreciated!
Looking to the future…
Customers will continue to demand hyper-personalisation of everything they purchase and consume. Companies are already leveraging a deep understanding of customer preferences through research, feedback and deep-diving into customer data of all types. The future will hold more of this: companies pre-emptively anticipating their customers’ needs, and in doing so, taking the opportunity to impress through tailored service.
Further to existing trends, people will continue to demand increases in speed as well as accuracy. You should be using the tools available to you – everything from marketing automation, online tracking, social presence and more – to not only communicate with your customers – but exceed their expectations on every front.