What Is Good Customer Service and Why Does it Matter?

Businesses provide goods and services to customers. The support that they provide to a customer or a potential customer before, during, and after the purchase of goods or services is called customer service. A business can have the best of products or services, but it cannot survive without providing great customer service. In this article, we will discuss what constitutes good customer service and its significance for businesses.

What is Good Customer Service?

Good customer service entails creating a long-lasting relationship with the customers. It means creating a healthy ecosystem where the business is geared to help customers at every stage.

Here are five things that constitute good customer service:

1. Great Service as the Foundation of the Business

Good customer service cannot happen in isolation. This means that offering great support only after a buyer or potential buyer has asked for it is not the hallmark of good customer service. Instead, build your entire business around service.

The philosophy of your business should be to provide proactive customer service. Teams should start taking initiatives and look out for the best ways in which to serve the customers.

2. Avoid Problems in the First Place

Most businesses are reactive to problems. They show great customer service once a customer becomes angry. However, that still means that the customer became angry in the first place. He might not do business with you in the future. Instead, your customer support system should be such that it doesn’t leave room for a customer to become angry.

3. Self Service

One of the most significant business tips you'll ever get is to emphasise self-service. Across industries, more than 80% of customers attempt to solve their issues themselves before reaching out to the company. Most of us search on Google for the issues we face with products, to try and solve them before calling the company. Self-service technologies are effective at eliminating simple issues. Remove the points of ‘contacts’ and replace them with self-service. This ensures that a customer doesn’t face an issue as he can resolve it himself.

You can use Customer Relationship Management Software or CRM to introduce your self-service features to customers.

4. Well-Trained Service Reps

Companies have been training and developing their reps the same way for generations. As Google and self-service make it easier for customers to deal with simple issues, they call reps for complex issues. Instead of being connected to a well-trained rep, they are connected to a robot first. Once they manage to get hold of an agent, he passes them off to another agent or another department. Businesses should be wary of having such customer service. They should focus on building a team of well-trained customer service reps.

5. Selfless Service

Businesses should place customer preferences and needs before everything else. This is one of the best business tips you will get. The goal of your business should not only be to make a good living. You should be passionate about providing value to others. As Napoleon Hill said, “You can succeed best and quickest by helping others to succeed”. Customers know when a business is dedicated to helping them; they will return the favour by visiting you again and again.

Why Does Good Customer Service Matter?

Here are a few reasons to invest in good customer service:

1. Customers Expectations

Customers expect great service. Technology has made the world small. People interact with local and global businesses from the comforts of their homes. As such, it is a highly competitive environment where many businesses provide great customer service. Therefore, customers already have high expectations when they do business with you.

72% of customers say that they expect businesses to understand their needs and requirements. Not only that, 66% of customers say that they will gladly switch brands if they don’t feel valued. Making your customers feel valued should be your top priority.

2. Increase in Customer Retention

Good customer service inevitably leads to an increase in customer retention. Even a 5% increase in retention results in a 25% increase in profits. Not only that, a returning customer spends 67% more with your business. Focus on customer retention by providing a good experience to your customers. Getting new customers can cost you five times more than the cost of retaining existing ones.

3. Word of Mouth

Word of Mouth has been a great marketing and sales strategy since time immemorial. People are more likely to trust their friends than brands. 77% of customers say that they share their positive customer service experiences with their friends and family. Think about it, we have all been positively surprised by some brands at some point, and have told about our experiences to friends and family.

Positive customer experiences play a significant role in increasing brand awareness. 55% of customers start buying from a brand after hearing about their great customer service. Become a cool brand that people want to buy from by focusing on customer service.

4. Customers Pay More to Businesses with Good Customer Service

Nearly 50% of customers do more business with a brand after a positive experience. 67% of customers say that they will pay more if it means that they get great customer service. Most customers will gladly pay a premium on products and services if they know that they can count on the business and their customer service. These stats predict a grim future for businesses that do not invest in providing good customer service.

5. Increase Customer Lifetime Value (CLV)

The lifetime value of a customer is the amount of money he will spend with your business throughout his life. This is a significant metric for businesses. Growing this value results in an increase in revenue and profits. Only a customer who trusts your brand will keep buying your products. Thus, when you venture into new territories and introduce new products, you can easily sell them to your loyal customers.

6. Competitive Advantage

Here are some business tips to survive in this competitive environment: Businesses need to stand out from their competitors. You should strive to be better than your peers. Customers will engage and interact with your brand if they feel you are the best. Customer service can be the difference between the good and the best. Eliminate poor customer experiences from your business. One poor service experience can lose you a customer. Even if customers encounter a problem, solving their problems in the first interaction keeps them happy. The brand philosophy of customers first can revolutionise your business.

Conclusion

Customer service is a crucial driver of company perception and loyalty. Good customer service entails creating an ecosystem dedicated to enriching the lives of customers. They retain more customers and create a loyal following of their brand. Businesses that emphasise providing good customer service outclass their peers.

Also read:

1) 10 Best Ways to Promote Your Small Business
2) How Many Social Media Sites Can I Promote My Online Business On?
3) Online Business Ideas You Can Start Quickly
4) 8 Online Business Ideas That Could Make You Hit Gold in 2020
5) OkCredit: All you need to know about OkCredit & how it works.

FAQs

Q. What are some useful business tips for customer service?

Ans. Clear and friendly communication, empathy, patience, problem-solving, and professionalism are some of the qualities of customer service.

Q. How do you handle difficult customers?

Ans. Try to create a rapport with them. Listen to their problems calmly. Do not raise your voice no matter how rude a customer is. If you cannot stay calm, call another rep or the manager to deal with the customer. Do not take it personally. They have an issue with your business, not you. Most of all, be patient.

Q. What is an example of good customer service?

Ans. Solving a customer’s problems in the first interaction is an example of good customer service. Even more than that, preventing problems in the first place is a hallmark of top-notch service.

Q. How to improve customer service skills?

Ans. Train your reps well. Allow them to go off-script to solve customer grievances. Create a positive work environment for them to reduce turnover and absenteeism.

Q. What is customer service in simple words?

Ans. Customer service is the support you provide your customers or potential customers before, during, and after they have made a purchase.

Q. Why is customer service so important?

Ans. Good customer service helps businesses retain customers. Customer acquisition is five times costlier than customer retention. Moreover, loyal customers spend more with their favourite brands. 7 out of 10 customers say that they spend more with businesses that provide great customer service.

Q. What is excellent customer service?

Ans. Excellent customer service is surpassing customer expectations. As most businesses focus on customer service these days, it is hard to surpass expectations. Businesses need to be proactive to provide excellent customer service.