Does good customer service really matter?

BY mikeh ON 26th June 2013.


The benefits of good Customer Service
We’re told time and time again that Customer Service is important. However, striving for continuous improvement is a lot of work. Keeping up with the latest innovations, continually raising standards and staying responsive to customer feedback requires on-going investment, creativity and uncompromising commitment at every level of the company.

In this bleak economic climate, it can be all too tempting to focus on other things and keep Customer Services costs as low as possible.

If that’s your temptation, resist it: tacking Customer Service on to your business as an afterthought is a huge mistake. In a recession, a good service is more important than ever. Your customers are your lifeblood: get things right for them, and everything else will fall into place. Get things wrong, and you will lose out.

The Real Cost

9451If customers don’t feel like they get a good product or service, they won’t always tell you to your face. But although only around 4% will take the trouble to lodge an official complaint, 91% of unhappy customers will simply leave you and never come back. What’s more, they’ll probably tell between 9-15 other people about their bad experience . No organisation wants to fight a bad reputation.

Good Customer Service makes good business sense. If you don’t invest in this area, there’ll be a clear and immediate impact on profits. UK businesses lose an estimated £15.3 billion each year through defections to other companies and abandoned purchases as a direct result of a poor Customer Service experience.

If you don’t understand the value of your customers, someone else will. 89% of consumers began doing business with a competitor following a poor customer experience That’s something you can’t afford to happen. As supermarkets have realised, brand promiscuity is the norm these days; customer loyalty isn’t automatic. It has to be earned.

The Real Benefits

On the flip side, real investment in customer service has an enormous payoff. One good customer experience has vast repercussions.


Good Customer Service creates great free publicity. When you’ve had exceptional experience with a company, you tend to want to tell your friends and family all about it. With social media, it’s likely you’ll even share the happy news with complete strangers.

Goodwill gestures really work. Our emotional responses are paramount: they account for half of a customer’s overall experience, a recent survey suggests . 70% of buying experiences are based on how the customer feels they are being treated. The human touch is vital. Going ‘above and beyond’ may cost more in the short term, but long term, it will get you a powerful voluntary sales force that can reach your target audience like nothing else.

Good Reputation

Get enough advocates and the word will soon spread that you’re a good company to deal with. Social media spreads good or bad experiences like wildfire, and your reputation counts for a lot. Once your name becomes synonymous with quality and high standards, you’ll automatically have an edge over your competition.

Customer Loyalty

If we’ve had a good experience with a company, it’s very unlikely that we’ll go anywhere else. Loyal customers are worth their weight in gold. A 10% increase in customer retention levels results in a 30% increase in the value of the company. That’s because losing customers is expensive: aside from dealing with complaints, it costs 6 – 7 times more to acquire a new customer than it does to retain an existing one . Customers value good service so much, over half are happy to pay a bit more for it.