Why Pay Attention To Your Customer Service? Because It Will Impact Your Revenue
Enterprises must pay attention to the quality of customer service they offer because:
- Good customer experiences boost repurchase probability and long-term loyalty. Customer loyalty has quantifiable economic benefits as measured over three dimensions: willingness to consider another purchase, likelihood to switch business to a competitor, and likelihood to recommend to a friend or colleague.
- Poor customer service experiences lead to increased service costs. The cost of failing to meet these expectations is high: 75% of consumers move to another channel when online customer service fails, incurring costs.
- Poor customer service experiences risk customer defection and revenue losses. Customers who have poor service experiences – estimated at 30% – are at risk of defecting, even if they do not complain – and the revenue impact of churn can be easily quantified.
- Poor customer experiences can quickly damage the reputation of your brand. Customers who are disappointed at the service they receive are quick to voice their disappointment, which is amplified over the social channels and can erode brand value. Forrester’s Social Technographics® ladder shows 68% of B2C consumers and 80% of B2B customers fall into the “spectator” category, which consists of people who read negative comments posted on social media sites.
An increasing number of enterprises recognize the importance of focusing on delivering customer service experiences in line with customer expectations in order to keep their customers satisfied and loyal to their brand. For example, data from a recent Forrester survey conducted in conjunction with CustomerThink shows that forward-looking customer service organizations:
- Focus on improving the customer experience as a top priority. 40% of respondents report that “improving the customer experience” was their most important customer service goal. In contrast, only 12% of respondents rated “reduce customer service costs” as their top goal, and only 3% rated “improve agent productivity” as the most important goal for their operations.
- See customer service as a differentiator. 20% of the respondents report that “creating a competitive advantage” was their most important customer service goal; 20% reported it as their second-most-important customer service goal.
- Believe that customer service can be a profit center. 17% say that “selling more products and services to existing customers” was their organization’s most important goal.
Delivering good customer service experiences is a pragmatic balance between reducing the cost of operations and investing in efforts to improve the experience and move the needle on revenue. Read about how to craft the right business case for customer service investments here.