In today’s world, a great idea, an amazing service, or an innovative product isn’t enough. There are thousands of businesses that start with a mission and a fantastic product, yet still sink without a trace. As you read this, another one will be winding down, wondering where it all went wrong.
They could start their analysis by examining the strength of their customer service.
The promise of efficient and effective customer service isn’t just a ‘nice to have’ any more. In a competitive market with short attention spans, it needs to be at the very core of your business.
Your customer service is the public face of your brand, and as far as your customers are concerned, the face that matters. According to statistics, more than 65% of people expect more from customer service now than they did five years ago.
It is essential for generating sales opportunities and retaining loyal customers. More than three-quarters of consumers are more likely to shop with a company that demonstrably delivers a superior customer experience, of which customer service is an important part.
Despite this, 46% of consumers have said that they find customer service frustrating. So why are so many companies dropping the ball? More importantly, what does your company stand to gain by delivering high-quality customer service?
Here are six reasons why customer service is a key part important of your business success:
You can retain valuable customers
Retaining loyal customers is a cornerstone of any successful business. Putting aside sentimentality, customer retention simply makes good business sense - it is cheaper and easier than finding new customers.
In fact, new customer acquisition costs six to seven times more than simply retaining the customers you have. Most successful businesses aim for 65% to 70% of their sales to come from existing customers.
By offering superior customer service, your clients are more likely to come back to the brand they are familiar with and have positive feelings about.
You can boost sales
The strength of your customer relationships can make the key difference between a customer purchasing a product or service from you or from your competitor. It’s so important that 68% of customers said they’d even be willing to pay more for the same product or service, provided that they had a better customer experience in doing so.
Personalization plays a big part in delivering superior customer service. The right software and tech can ensure that customer information is accessible in real-time, so customer don’t have to repeat themselves. And tech such as AI bots can help support real-life customer support staff to answer queries quickly and easily, no matter the time, which allows for responsive, quick issue resolutions.
On the flipside, failing to offer adequate customer service can diminish profits and stunt revenue growth.
You’ll generate referrals
Any marketing or communications strategies that you employ will be augmented by ‘word-of-mouth’, that amazing ingredient that all ambitious businesses strive for.
Word-of-mouth, and more specifically referrals, are key for spreading the word about the great experiences that your previous and existing customers have had with your business. They might tell their friends, family and even their extensive social network about a positive experience, and encourage them to pay your business a visit. Referrals can often be a company’s most effective form of advertising - and also their least expensive.
Some customers go beyond simple referrals and become brand advocates. This can happen when you establish a true business-customer relationship by acknowledging that customers can provide a valuable source of feedback and allowing them to feel involved in the growth of your business. You can begin building these meaningful relationships by facilitating conversations, and employing proactive engagement with a rewards program and personalization.
You can cross-sell and up-sell
Creating a more dedicated and committed customer service approach will allow you more opportunities for cross-selling and up-selling to your customers. Cross-selling means offering your customers an extra product or service that is related to a purchase they’ve already made. Up-selling refers to additional subscriptions or upgrades that can provide a customer with greater value.
If you use customer relationship management software as part of your customer service functions, then this software can give you crucial insights into purchasing history, sales information, and other customer experience metrics to open up those cross-selling and up-selling opportunities.
It’s about listening to your customers and tailoring your sales offer for your loyal customers based on their specific needs and preferences. It will communicate to your customers that your business has their desires and needs as a priority.
You can increase customer lifetime value
Measuring customer lifetime value will tell you how much revenue in total you can expect from a single customer account. This is the ultimate metric of a returning customer. The higher the value, the greater loyalty it represents. A higher customer lifetime value will also help you to identify more opportunities for cross-selling, up-selling and sales increases. It’s estimated that currently, only 42% of companies have the capability to measure lifetime value. Implementing this metric for your business will put you at the cutting edge, giving you a greater understanding of the value of your customers.
You can proactively address customer issues
Why wait until an issue arises? Efficient and effective customer service should be proactive in identifying problems, and reaching out to customers before they even know that an issue exists. This gives customers the impression that your business is always working hard to improve its user experience.
If you see a common issue in your business and work to resolve it, you can make good use of your communications to identify the customers affected and let them know about the resolution. Customers will quickly appreciate that you take an active approach to solving problems rather than waiting for the complaints to roll in.
An AI chatbot could offer another opportunity to proactively address customers, perhaps popping up with question prompts while the website is being used or offering information on certain products, so customers feel taken care of.
Put customer experience at the core of your business
Why is customer service important? It provides a direct connection between your customer base and your business. Improving the service as a whole will help you retain loyal customers and cut acquisition costs. Customer experience metrics will drive your marketing efforts and allow you to identify cross-selling and up-selling opportunities.
A strong customer service department, hand in hand with good comms, can help you to identify customer issues in a proactive way and demonstrate that your business cares. Opening your business up for communication and feedback can make you responsive and stronger in providing customer service.
In a more competitive environment than ever, your business needs an edge to get ahead. Strong customer service can mean the difference between sinking or swimming.