9 Reasons Why Customer Service Is So Important

Customer service is evolving rapidly, thanks in part to advances in digital and communication technology. In the past, unhappy customers would be resigned to writing a letter or picking up the phone to lodge a complaint.

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These days, a simple tweet about poor customer service can get the attention of a giant corporation – and millions more if it goes viral. According to a Microsoft report, 54% of all consumers globally say that they have higher customer service expectations than they did just one year ago.

It’s safe to say that providing the best customer service experience possible should be a top priority for every business, be it a billion-dollar corporation or a single employee mom and pop shop. Still not convinced? Here are reasons why customer service should be top-of-mind for entrepreneurs.

1. Increases Trust and Customer Loyalty

Customers keep score each time they interact with your company. Whether it’s asking a question on social media, interacting with an employee, returning a product or disputing a service, they are testing out your customer service policy. Being responsive and engaged is key to building trust and loyalty.

2. Customer Retention is Cheaper Than Acquisition

Did you know that it costs five times as much to attract a new customer, then to keep an existing one? Without retention, the cost of conducting business can skyrocket as you’ll need to spend money to acquire new customers. Keep your current customers happy so they won’t be tempted to go elsewhere.

3. Customer Spending is Impacted

According to a study by American Express, 58% of consumers are willing to spend more on companies that provide excellent customer service. That means your prices don’t have to compete with Walmart or Target – you can give shoppers a personalized experience that the big boys just can’t offer.

4. Customers Return to Your Business More Often

Repeat business is the lifeblood of any company. When it comes time to shop again, chances are your customers will remember a positive customer service experience and want to give you their business again.

5. Generates Positive Word-of-Mouth Referrals

You’ve probably heard a friend or family member exclaim “I’m never shopping at ______ again!” , followed by a story of a bad experience. But great customer service stories get passed along too. In fact, 88% of consumers placed the highest level of trust in word-of-mouth recommendations from people they know. Don’t assume that your happy customers will tell others about your product or service.

Instead, give them the tools they need to easily share their experience. That could be giving them a link to your Yelp or Google Review page or even offering customers who refer others a free product or a discount.

6. Increases Brand Awareness

Brand awareness is a powerful concept that can impact marketing efforts, consumer perception, and revenue. There are lots of strategies to increase brand awareness but one of the easiest ways to build it is through solid customer service.

7. Reduces Problems

Customers are willing to be a little more lenient if things go wrong, especially when they know complaints are handled swiftly and effectively.

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8. Compensates for Higher Prices

Few small businesses can compete price-wise with a Target or a Walmart. However, entrepreneurs may find that customers are willing to pay a little more for high-end customer service. A better customer experience helps your buyers feel valued, something a huge corporation might find difficult to do.

9. Creates Happier Employees

If your employees are constantly dealing with unhappy customers, they’re likely to be unhappy themselves. On the other hand, if you’ve established top-notch customer service, you’re likely to have happy shoppers – that can greatly increase employee morale.

Customer Service Tips

Here are quick tips to help you build a business that values its customers.

1. Be Accessible

That means have your contact information front and center on your website and across your social media channels. No one wants to search and search for a way to reach a business.

2. Train Your Team

You can hire the friendliest person in the world, but that person needs to be trained. Do they know your product or services inside and out? Can they resolve typical – and not so typical – problems or complaints? Create a best practices document for each team member that interacts with customers.

3. Ask for Feedback

Customer feedback is valuable! Make it easy for customers to comment on your business by soliciting feedback via online reviews, comment cards or surveys. You’ll learn what you’re doing right – and where you need to improve.

4. Be Responsive

An unanswered call, email or social media post can lead to customer anger and frustration. Have systems and processes in place to rapidly address customer questions or problems. If you have social media pages, have an employee monitor those for comments. These days, consumers are likely to use social media to connect with companies.

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