When budgets are being cut because of an anticipated recession, many brands are making cuts or not investing in customer service. Customer service is the direct connection between your customers and your business. It retains customers and extracts more value from them. By providing top-notch customer service, businesses can recoup customer acquisition costs. This helps to cultivate a loyal following that refers to new customers, serves as case studies, and provides testimonials and reviews.
I’ve noticed that many of my Amazon.com shipments are not arriving in two or four days. This area has a shortage of drivers, and the nearest warehouse is 110 miles away. To compensate, I have started ordering from other retailers who deliver within one or two days.
FedX is usually very busy this time of year but calls customer service, and you’re going to be put on hold, and then you’ll wind up talking to someone in the Philippines or India. When I called this week about a problem with my online account, it took over 24 minutes, and they still didn’t solve it.
Big brands are NOT investing in customer service or cutting customer service budgets. That’s a huge mistake.
Why Is Customer Service So Important?
Customer service is important because it inspires customer loyalty and makes employees’ jobs easier. This, in turn, helps businesses grow. Organizations can recover customer acquisition costs, retain talent, and foster brand loyalty by providing excellent customer service.
Customers who interact with a brand’s customer service team usually have questions they want to be answered or a problem resolved. Whether a customer is satisfied or frustrated depends on how quickly and well customer service reps respond to their query. More often than not, customers are left disappointed—46% of customers find customer service frustrating.
Customers want the problems they encounter to be solved fast. For 89% of customers, speed of response and resolution are the two most important parts of excellent service, irrespective of the channel (i.e., types of customer service).
Unfortunately, traditional methods of customer service support are plagued with inefficiencies. Customers don’t want to fill in customer service forms, wait on hold, or explain their problems to a robot via live chat. They want to talk to a human being who knows who they are and has the means to resolve their issue promptly without too much back and forth.
Research shows that:
- 84% of customers are irritated when agents don’t have the necessary information to resolve an issue.
- More than 50% of customers are annoyed when they repeatedly repeat their problems to different agents.
- 60% of customers are frustrated when their issues are not resolved during first contact.
Even small friction points in the customer service experience can result in customers dropping off.
It’s hard to put a price on great service, and an extraordinary number of customers are willing to pay a premium to get it. Customers place a high value on how a customer service team treats them, and companies will directly profit from positive customer service encounters. Over 80% of customers reported being willing to pay more for a better experience.
In an era where companies are learning to prioritize customer service, any company that doesn’t do so will crash and burn. Moreover, one positive experience could make them stick to a brand, whereas one negative interaction could send them to a competitor.
A report showed that 89% of companies with “significantly above average” customer experiences perform better financially than their competitors.
Additionally, American companies reportedly lose about $136.8 billion yearly because of avoidable customer losses. Therefore, a positive or negative customer experience directly impacts your company’s revenue and growth.
Customer service employees can also offer important insights into customer experiences.
It doesn’t matter how you perceive your brand. What matters is how your customer perceives it. For instance, if you work for an athletic wear company, you might associate your brand with fitness, health and wellness, and people who play sports.
However, your customers may purchase from you because they associate your brand with leisure, comfort, and attractiveness. So, you should align your marketing with those values as well.
Your customer service team can answer many of these probing questions for you. Rather than spending time and money surveying customers constantly, you can have your customer service employees ask these questions while interacting with customers. Their response can give you many insights into improving your products, marketing, goals, and employee training.
The more you improve the customer experience, the harder your employees will work. Research shows that companies that invest in customer experience also see employee engagement rates increase by an average of 20%.
Cutting customer service or not investing in CS is a huge mistake. Every brand marketer should call their company’s customer service line to experience what it’s like.