Unhappy customers take their business to your competitors. Your customers and clients want you consistently to meet or exceed their expectations of doing business with you. They don’t really care how you do it.
Studies show that it costs five to ten times more to get a new customer than it costs to keep an existing one. It is much more profitable to continue to please existing customers or clients than acquire new ones.
Can you recall a time when you received poor customer service and took your business elsewhere? We all can. As I am writing this an employee from FedEx Kinkos called to tell me they have the proof of a printing job that I had given them eight weeks ago. She wanted to know if I was still interested in doing it. I responded, “No, I’m not interested in doing it. “ She replied, “Oh. I see.” I explained, “The customer service is so poor that I am doing business somewhere else.”
Had she been interested, concerned or trained to provide good customer service, I suspect she would have asked for more information. What had caused them to lose a good customer? How could they do things differently so they had happy customers returning? Instead she asked if I’d like to get my CD.
The root causes for poor service resulting in unhappy customers:
• misplaced priorities within a tight budget
• challenge of relating an investment to improved customer service
• effort required to find, hire and train good employees
• not knowing why customers leave or stay
When money is in short supply, the natural tendency is to scale back and cut costs. Outsourcing has become the norm for many companies. Jeffrey Pfeffer says in Business 2.0 Magazine (March 1, 2006), “If outside contractors cut costs, it might be because they’re more efficient. But it’s far more likely that the savings occur because contractors pay their people less, spend less on training or both.”
“…in-house employees tend to be far more interested in nurturing a good reputation among clients and customers,” says Pfeffer. When the service you are providing is directly associated with the company you work for, it seems natural that you are more motivated to see that it’s done right the first time.
Your competition can hire the same contractors to provide the same poor service so where’s the sustainable competitive advantage? Cutting costs by outsourcing may be straining out a gnat and swallowing a camel. The competitive edge that keeps customers coming back is not price but the perceived value of what customers think they’ll get for their money. Pfeffer says “…competing solely on price is a fool’s game.”
Elements of Excellent Customer Service
• Hire the right people. Even if it takes longer to find them and you have to pay them more, hire good people.
• Buy equipment or technology that supports excellent customer experience. As Jim Collins points out in Good to Great, “… technology by itself is never a primary cause of either greatness or decline.” Resist buying equipment or technology for the sake of technology. Know how technology or equipment will improve the customer experience in advance and invest well.
• Create a good environment for your customer or client.
This could include:
o Current magazines
o Thriving plants
o Comfortable seating
o Good lighting
o Fresh paint and an appropriate color
o Clean and uncluttered
• Design systems and procedures so you do the job right the first time. Remember the adage, “If you don’t have time to do it right the first time, will you have time to do it over?”
What does excellent customer experience look like? Here’s an example:
I have a termite bond with a local exterminating company that has been in business for three generations. I discovered active termites around the frame of exterior French doors.
With no hassle, the exterminating company came to inspect the damage. The employee who handled my repairs was punctual, cheerful and polite. He was skilled and did an excellent job of replacing the damaged framing and re-hanging the doors so they close easily and evenly. He cleaned up when he finished the work.
In the grand scheme of things, this was a very small repair project. The way it was handled, however, left a very big positive impression.
Focus on these Actions to Give Excellent Customer Service:
1. Remember that the culture of excellence starts at the top
2. Provide a clear vision of what excellent customer service is and the training so your employees know how to do it right
3. Over deliver and give your customers more than they expect
4. Stand by your work
5. Treat your employees as well as you treat your customers
6. Find unique ways to serve your customers
When it’s all said and done, where to spend your money is a pivotal choice in providing excellent customer service. We all agree that excellent customer service is desirable for all businesses. Do you buy new software to track inventory or do you send your sales team for training?
Knowing the return on your customer service investment is basic in making good choices. Regardless of the size of your business, saving money in the short run could be costing you valuable customers or clients in the long term.
