Why Customer Service Rocks
Scenario: "Dude, we can't always focus on the customer. We need to grow revenues! Yay!" A great way to grow those revenues? Focus on service, and your long-term prospects look that much sexier.
Tha Empirical Evidence
Sure, you read about customer service in business books all-the-frickin'-time -- theories that "sound good," and that's about it. But if you're a badass business builder, you want empirical evidence that customer service rocks. And to save the day, finally -- about a few months ago, comes a study by University of Michigan Professor Claes Fornell and friends:
What They Did
Fornell and colleagues showed the relationship between customer satisfaction and financial success by creating a hedge portfolio in which stocks are bought long and sold short in response to changes in the American Customer Satisfaction Index (ACSI).What They Tracked
Developed by the University of Michigan's National Quality Research Center, the ACSI is an indicator of economic success that reflects levels of customer satisfaction with goods and services purchased from about 200 companies in more than 40 industries; it's based on interviews with more than 65,000 U.S. consumers each year.What Resulted
Collectively, the companies with high customer-satisfaction scores have blown the S&P 500 out of the water (ASCI 144.5% versus ASCI 38.7%, respectively), especially over the last few years.
Whether you're a major public company, or a tiny business, solid customer service is one of your essential ingredients to rock the world.
Why We Avoid Customer Service
Before you started your business, your precocious behind probably thought like most (us included): * "I'm gonna build a business with the best customer service around! Yay!" And then, when you started building your business, something similar happened: * You just finished a transaction with Customer A. * You're trying to deal with Customer B. * Customer A comes calling after you. * You do whatever you can to avoid Customer A, so you can concentrate on Customer B.
Who could blame you?
* You want to increase sales by 20% this quarter. * Customer A doesn't boost your bottom line (or at least, it's not as obvious that s/he does). So, the logical thing -- it seems -- is to just focus on new transactions, and leave customer service left to dry.
Why Customer Service Matters
When you avoid customer service, you're putting a band-aid on a major internal injury. It seems dandy in the short-term, but the "Grow, grow, grow, grow!" mentality -- with mediocre service -- will run your business into the ground. How? * Crippling your business's foundation. * Causing horrific word-of-mouth. * Killing repeat purchases. * Destroying referral rates.< * Stifling your company's potential. If you're customers are hating on you, take that as a sign that your customer service needs major surgery. That could include: * Increasing product prices. * Keeping growth in check. * Training your employees more effectively. * Boosting efficiency. Once you fix whatever that's harming your customer service, you prep your fabulous business for the long-term -- and see yourself growing those ridiculous revenues you once envisioned. The relationship rule of thumb: * Customer service, first. * Growth, second. Sing it with us:
"How may I serve you, you sexy !@#$?"
Read More Business Tips From Trizle »
15 Comments
on Why Customer Service Rocks
Incredimombo
2007-03-02 13:11:19 UTC
I don't know how the hell I got here, but man o man, I'm glad I did!
Demetrius Pinder
2007-03-03 07:50:13 UTC
Wow, you make an awesome point about dealing with customer A only to have customer B knock on your door.
Why not just take care of Customer A and do it right the first time. My parents used to say "If you do a half-assed job, expect to do it again".
Great blog!
Ana
2007-03-04 23:49:18 UTC
Another great advice. I am loving this blog of yours!
I agree with you, one dissatisfied customer could spread the word easily to 100 of their friends and then 100 of their friend's friends would make 10000 dissatisfied people. Not a beautiful situation to be in!
- Ana
andhapp
2007-03-05 02:49:25 UTC
Very good post...
Customer services is actually very essential for a company's growth no denying about that and what most of the companies forget is their customers will do 'word of mouth' marketing for them absolutely free of cost. Consistently good customer services does surprise the customers but at the same time it gives them confidence to come back and re-order.
On the contrary:
Let us say Mr. Champ started a company.
Since he has invested his hard earned money into it he will ensure every customer is a happy and satisfied customer but what happens when the work gets delegated to employed staff who are there to do their job and do not share the same passion as Mr Champ. Result is awful customer services; no word of marketing, no customer re-orders, bad reviews, complaints and so on.
So I guess the issue here how to instill the same passion and motivation in the employed staff !!! and we have all seen several posts on employee motivation here on trizle...
Walter Schwabe
2007-03-05 17:43:34 UTC
Customer service is, has and always will be #1, i didn't need a study to say that, but it's nice to have one for all the skeptics...
employee motivation is clearly something that needs to be a deeper more involved process than larger paychecks...meaning, respect, association with a winner...positive alignment between employee and corporation goals...way to go Professor Fornell...time to tackle the employee question...for all those who need empirical data to back up the importance of their part in what should be an act of theatre every day....
The Trizle Team
2007-03-06 06:35:59 UTC
Hi Incredimombo,
Thank you so much for your awesome comment! We don't market the blog too well because of time-constraints, but we're glad you found us.
Hope all is well with ya!
-Andrew
The Trizle Team
2007-03-06 06:38:33 UTC
Hi Demetrius,
Thanks for the compliment, man! We totally appreciate it. Great, great insight from your parents -- and I couldn't agree more. If you do one thing, you're slowly creating a habit of it -- which will most likely cause you to do the same again. So, getting in the habit of providing good service is so important. Great stuff, man!
-Andrew
The Trizle Team
2007-03-06 06:42:42 UTC
Hi Ana,
Thanks for your kind words! We can't tell you how much we appreciate it. And, I totally agree with your concept. News of your customer service can have that crazy spiraling effect -- it's like a virus that keeps on spreading (good/bad) news to an exponential number of people. Crazy phenomenon.
Thanks for sharing, Ana!
-Andrew
The Trizle Team
2007-03-06 06:49:39 UTC
Hi andhapp,
You brought up a great point. So many awesome things could happen with good customer service -- especially what you mention: free word-of-mouth. Nothing comes better than a recommendation from a friend, and hey: that's how the masses buy their things, anyway.
Regarding your anecdote -- thanks for the idea! We mentioned it briefly in our latest article (titled "Why You Don't Matter"), so that can give you an idea of how to achieve that good customer service you're after.
Great comment, andhapp! We appreciate your thoughts on this.
-Andrew
The Trizle Team
2007-03-06 06:55:12 UTC
Hi Walter,
Fabulous mention about customer service being "an act of theater." For instance, when you walk into your favorite restaurant, that's the feeling you're likely looking for: how everything flows harmoniously.
And, employee motivation definitely runs much deeper than employee paychecks. The work has to ignite the employee before you'll see those awesome results you're seeking -- like what you say.
Thanks for the valuable comment, Walter. We appreciate it!
-Andrew
andhapp
2007-03-06 08:59:09 UTC
Great work from Trizle Team... I highly appreciate the efforts you put into replying to people's comments... now this is how you retain your customers...by looking after them and here we think our comments matter and we come back over and over again and you achieve retention.
Thanks
The Trizle Team
2007-03-07 05:41:08 UTC
You rock, andhapp! Thanks for the feedback, man. We love you guys and gals, so we'll always be here to support y'all.
mary
2007-03-24 16:50:34 UTC
Customer service seems a old-fashion notion now-a-days, at least from this customers view of service, most every place I go. Imagine my surprise to find a cute email from the CEO of a small online company, gushing with praise for my purchase. The effect was to make me want to go purchase some more stuff! Which I will be doing when budget allows. In the meantime I'll be recommending the company to anyone who will listen.
Without customers every business will go under.
Nigel sharpe
2007-03-27 16:29:04 UTC
Andrew, your work rocks! Still waiting for my advice, nigel
Everyone Loves an Underdog - Zoomstart
2007-07-18 21:54:30 UTC
[...] You’re a best friend. Customer service matters. You’d never bite the hand that feeds you and you’re always willing to shake-a-paw or fetch a pair of slippers. Loyalty is something that just seems to come naturally. [...]
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