What are the benefits of good customer service?

It isn’t fun to have a bad experience with customer service. Sometimes, expectations are not met when you are on the other side of the phone. Studies show strong customer service pays great dividends to an organisation’s long-term stability and growth; many companies employ a customer relationship management system (cms) to help keep customers happy. With that said, there are a number of benefits of customer service, so let’s take a look at each of them.

Satisfied Customers & Customer Relationship Management

The first benefit of customer service is obtaining customer retention. Happy customers become repeat customers. This means competent, well-trained customer service representatives are needed to handle questions and issues; if the company doesn't have this it often looks for a cmr solution that will reassure customers that their needs will be met. Representatives who excel at listening to the customer go a long way with the customer’s resolution of an issue. Support desk representatives that strive to help the customer can ultimately lead to better customer satisfaction.

Customer Loyalty & Loyalty Marketing

A key indicator of quality customer service is customer loyalty. Customer loyalty means what it says. Customer retention occurs when a product or service is consistent in what it’s supposed to do. The result can be a steady revenue stream and consistently fulfilling a costumier expectations increases the customer's loyalty. A study by US News and World Report reports 68% of why customers leave a product or service for a competitor is because of a bad experience.

The typical customer will talk to people about a negative customer service experience than a positive experience. The typical customer will tell between 8 and 25 people about a negative experience, and the internet continues to increase this exposure. A typical customer will only tell one or two people about a positive experience. However, if you reward customers for their loyalty (with rebates, coupons, freebies, etc) they feel valued for their choices and continue to remain a consumer of a company's product or service.

Less Costs Needed to Attract New Customers

Quality customer service relieves pressure on the organisation to attract new customers. Statistics show that it costs more to gain new customers that it is to retain existing ones. The benefit of customer service comes into play here. A thorough customer service program will help maintain an existing customer base rather than lose a percentage of it.

Edge on Competitors With Good CRM

If your organisation out-performs another competitor in customer service, most likely, your organisation will be one of the leaders in your industry. Interestingly, if a company offers a product or service at a higher price than a competitor, it doesn’t necessarily mean the more expensive competitor will lose its customer base. According to Accenture’s 4th Annual Study on Customer Service for the United States, 73% report they left a service provider because of poor customer service, versus only 47% who left because of a lower price.

Promotes Customer Service Employee Retention

Customer service representatives who understand they are the face of the company will help them communicate with customers on the other side of the phone. Proper training in handling phone calls and trouble-shooting issues can promote job satisfaction, which translates into longer employee retention.

Cite this Article A tool to create a citation to reference this article Cite this Article


About the Author

Michael Martin began writing professionally in 2008. He has more than 10 years of experience in the insurance industry and primarily writes about legal issues. Martin holds a Juris Doctor from Albany Law School and is licensed to practice law in New Jersey and Pennsylvania.

Try our awesome promobar!