But, if you’re not using intuitive customer support software yet, it won’t be easy to do all this alone. And, 67% of this churn is preventable if the customer's problem is resolved during their first interaction. A good customer service team is involved in all of these mediums. Customer marketing involves turning existing customers into advocates. According to Fundera, 20% of small businesses fail in their first year, and 50% fail by their fifth year. Employee happiness correlates to customer happiness, 7. Understanding why is customer service important is the first step in delivering exceptional service. You don’t need to do all that. You want to be better than every other company you're competing with and you want your customers to know it, too. In fact, 56% of people would recommend a company with excellent service to family and friends. Customer service is importance to your business because it's retains customers and extracts more value from them. Finding a new client every time you wish to sell your product can be an expensive process. Providing excellent, and memorable, client support is important for client retention. Read the following list to understand how essential customer service is to improving your business and relationships with customers. Brand awareness soars with positive customer experiences, 9. But if you can provide a seamless customer service experience, people will be forgiving. Start your free trial of Groove to get access to simple reports and actionable customer insights that you can share with your entire team. CLTV correlates directly with revenue. It … Stop asking yourself “why is customer service important?” and make sure that your customers know how important they are to you. By putting a number to the importance of customer satisfaction, you can have more meaningful conversations with your boss and company about investing in your team.Commit the entire team to improving customer satisfaction day in and day out. Customer service is important because it can help you to: Increase customer loyalty; Increase the amount of money each customer spends with your business; Increase how often a customer buys from you; Generate positive word-of-mouth about your business For example, the Ameritas group division that handles dental, vision and hearing care insurance, has a strong track record for taking exceptional care of its customers. It represents the total revenue you can expect from a single customer account. Furthermore, good customer service would also increase sales numbers and lower marketing costs. Her goal is to help businesses grow by offering practical and actionable ways to improve customer experience. Normally its importance varies by product, industry and customer. So, by interacting with your customer service team, those customers can build, hopefully, life-long relationships with your business. Without a solid customer service team, your brand may fall behind on shifting customer trends. No matter what industry you're in, you want your business to stand out. So, you should align your marketing with those values as well. Q: I was in a high-end specialty store recently and I could not believe how poorly I was treated. However, your customers may purchase from you because they associate your brand with leisure, comfort, and attractiveness. Customers churn when they’re unhappy. Her background spans running customer support and experience at startups to running script changes on live TV shows. Growing this value means that your customers are shopping more frequently and/or spending more money at your business. No employee is going to enjoy coming into work if they feel under-appreciated compared to employees on other teams. Your customer service team, however, is your connection to your customers. And, their positive testimonials will be more effective than any of your current marketing efforts -- and cheaper, too. Better customer service means higher engagement, which leads to more dollars spent. Customers are influenced by even a single experience; one positive experience could be the deciding factor for them to stick to a brand, whereas one negative one could send them running to a competitor. For scaling start-ups, providing an excellent customer service experience is the surest way to keep up momentum and minimize loses. A company’s most vital asset is its customers. Or, perhaps you’re a founder who needs to convince investors to allocate more funds to build a robust customer service team. Better customer service begins with better customer service software —Start your free trial of Groove today The keyword in that chart is “working.” for USA TODAY. 56% of people would recommend a company with excellent service to family and friends. It would add a competitive advantage, increase customer loyalty and brand awareness and improve customer relationships. Of course, your product team could use some financial assistance and marketing -- especially advertising -- could always use a little padding. In a sea of competitors and plenty of options to choose from, customer servi… Products have issues. After sales service plays an important role in customer satisfaction and customer retention. How excellent service to bank’s customers affect their satisfaction and their choice of banking. What matters is how your customer perceives it. Customer service can be an excellent differentiator for your company. Rather than waiting for customers to report issues, this approach reaches out to them before they even know they exist. If customers have a great experience with your service and support teams, they'll be more likely to shop again at your stores. You’ll have happier customers, more streamlined processes, and easily hit your KPIs. It represents the total revenue you can expect from a single customer account. You should consider it especially while planning your marketing and positioning campaigns. Still not convinced? Let them know how much each customer depends on their work. For banks to thrive, both product and service delivery must be adequately aligned with customer expectations: achieving customer satisfaction and loyalty is essential for long-term survival (Reichheld, 2003). However, it might seem like a waste to invest money in your customer service team. The importance of customer experience should never be neglected. For consumers overwhelmed with options, a recommendation from a friend often tips the scales. (CLV) is a pretty important metric. CX Lead & Content Creator @Groove. When seeking to improve reputation, start with excellent customer service. Customer Service Is Important. It attracts customers, investors, partnerships, and employees. An increase in customer retention of merely 5% can equate to an increase in profit of 25%. These stats, examples, and explanations should help you get the funds, resources, and support you need to prioritize customer service in your company. Treating customers well is a business survival necessity. Only then will they find intrinsic motivation for doing a good job and serving their customers the right way, which will lead to your customers also feeling more respected and appreciated. Like customer experience, it’s a new term used to describe something that’s been around forever. Without happy customers that continue to buy from you, the business won’t survive. It's important to note that 55% of employees who strongly disagree about being happy with their jobs will still work especially hard for customers. Free and premium plans, Content management system software. Customer advocacy is a very efficien… By providing stellar customer service, you can differentiate your company to customers. The importance of customer service is that it can make or break your business. It's also an effective marketing tool for introducing and promoting new products and services. If you're looking for a cost-effective way to invest in your business, you should consider adopting proactive customer service. They will also more keenly interact with your posts, leaving some delightful and admirable comments. Average or mediocre support won't keep your customers either. A company’s relationship with its customers is about much more than improving product ratings or decreasing wait times. The importance of customer service is that when you treat your customers fairly and with respect, they return it by appreciating your gesture and becoming loyal to your brand. Viral social media campaigns and paid ads have their place, but nothing beats the oldest trick in the book. Let’s explore a comprehensive answer—backed by data, five timeless sources, and 11 qualities of exceptional support—to, “What is good customer service?”, Erika Trujillo Revenue dictates every business decision. In today’s society, these attributes are not being conveyed by employees. Investing in customer service helps activate your flywheel because loyal customers will help you acquire new customers, free of charge, by convincing prospects to interact with your brand. Surely, there’s a reason the phrase “the customer is always right” has become such a cliché. The question isn’t really, “why is customer service important?” It’s moreso, “how do I show that customer service is important?”. In short, happy customers lead to more money, growth, and sustainability. When building a successful business, everything screams for attention. Start your free trial of Groove to get access to simple reports and actionable customer insights that you can share with your entire team. Learn how to leverage great customer service experiences to drive business growth. Growing this value means that your customers are shopping more frequently and/or spending more money at your business. Revenue increases with good customer service, 2. It's not just for all the obvious fiscal reasons. A highly engaged customer refers to one who reads your emails, follows you on social media, and interacts with customer support (whether through individual correspondence or more general blog posts and knowledge base articles). Customer service programs are important in every business industry, including employee benefits. For example, if you create a new feature that solves a common problem with your product, your customer service team can refer it to your customers. Teams that measure customer satisfaction can easily calculate the expected risk of unhappy customers. Profitability is king, regardless of whether it happens on day one or day 1001. The intangible feeling of having a purpose motivates people far longer than free food ever could. 1. In fact, according to our research, 77% of customers have shared positive brand experiences with others. Instead, it's about maintaining their professionalism and integrity, not wanting to get fired before quitting, being empathetic to customers, but getting recognition from them in the end. The same goes for your customer service team. This makes new customers more trustworthy of your business and allows you to upsell and cross-sell additional products with less friction. Marketing spend lessens with more customer advocates, 10. According to our research team, the customer acquisition cost (CAC) -- how much it costs to acquire a new customer -- is more for a company that doesn't invest a small percentage of its budget in customer service. (For one, it’s got “customer” in the name. See all integrations. That means if you provide excellent customer service, you'll not only retain your customers, but you'll acquire your competitors' as well. New users will trust that your sales team is recommending products that truly fit their needs which will create a smoother buying experience for both the customer and your employees. The coolest brands on the blocks — meaning, those with the most and best brand awareness — get all the fame and fortune. The number one reason why customer service is important in a business is because it correlates to revenue: 84% of organizations working to improve customer service report an increase in revenue. By providing top-notch customer service, businesses recoup customer acquisition costs and cultivate a loyal following that refers customers, serves as case studies, and provides testimonials and reviews. We're committed to your privacy. Simply prioritizing good customer service in an organization increases revenue. Get the 10 most valuable customer experience analytics for small-medium businesses, broken down in practical terms, with real-life examples. Without them, … 55% of customers become a customer of a company because of their reputation for great customer service. Your unique product or service may reel them in, but customer service keeps them. 55% of customers become a customer of a company because of their reputation for great customer service. Analytics help you track awareness by measuring everything from online reviews to social media sentiment to recommendation potential. Contrary to popular belief, your customer service team should be just as important  -- if not more important than -- as your other teams. And, this can sometimes be more effective than a sales pitch because customers feel like the service rep truly understands their issue after troubleshooting their problem. The term “company culture” elicits a buzzword, startup-y vibe. Having a group of customers that are happy and satisfied with your products is like having top rating for your business. Your customer service team can answer a lot of these probing questions for you. The majority of consumers sight good customer service as a reason for sticking with a company. Measure your progress, and enjoy the benefits.Satisfied customers will recommend you to their network. You may unsubscribe from these communications at any time. However, their reasoning behind serving customers is less about wanting to provide quality service. What’s more, customer experience provides the personalization that marketers crave. By valuing customers, and tirelessly working to serve them, you simultaneously create a company culture of helpfulness. Customer services play a vital role in the hospitality industry, it is the ‘backbone of any industry’ (Andrews). New users will trust that your sales team is recommending products that truly fit their needs which will create a smoother buying experience for both the customer and your employees. After all, how can it really improve? Save money and time with every loyal customer. Service recovery may cost a business anywhere between a few thousand dollars to several hundred thousand dollars. Melissa Rosen Engineers help the sales team. Investing in your customer service offer is an excellent way to improve customer lifetime value. Then, put the responsibility on every department to move the needle. hbspt.cta._relativeUrls=true;hbspt.cta.load(53, '48408caf-9dab-4f51-81c5-1be472518198', {}); Originally published Dec 20, 2019 1:29:00 PM, updated February 28 2020, 10 Undeniable Reasons Customer Service Is Important to Your Business. Customer service is a vital element of business operations that has a direct … Valued customer service unites goals and processes, 11. Business longevity relies on satisfied customers, 84% of organizations working to improve customer service report an increase in revenue, Better customer service begins with better customer service. Customer service is a competitive edge among competitors and within the industry. Here are some of the main reasons why customer service in retailshould be a top priority: Customer Loyalty. It's undeniable that a well-trained, positive customer service team can make your company the best version of itself. In an era where companies are learning to prioritize customer service, any company that doesn't do so will crash and burn. Positive customer experiences play a huge role in brand awareness, as they often lead to word of mouth advertising. They can help influence customers and convince them of your strengths over competitors. Therefore, if you want your customers to do their best work, they should feel respected and appreciated. Loyalty is rooted in trust, and customers can trust real-life humans more than the ideas and values of a brand. Pick a few customer-related metrics to measure, and track revenue in parallel, to see the connection. After all, shopping is as much of a transaction as it is an experience. It is important for businesses to be aware of this figure in order to assess the importance of customer relationships and how they can implement effective customer service … Your customers can be your best -- and cheapest -- form of word-of-mouth advertising, as long as you give them a reason to do so. Written by Swetha Amaresan One of the perks of having a proper customer service is that you will be able to retain your existing customers. The number one reason why customer service is important in a business is because it correlates to revenue: 84% of organizations working to improve customer service report an increase in revenue. For instance, when everyone is on the same page, the flow for bug reports should look something like this: To make sure this collaboration spans the long-term, set a larger goal to improve a customer experience-based metric, like NPS. Contact us today and see how we can help improve your customer service and satisfaction. Because your customers are your business. Customer service is importance to your business because it's retains customers and extracts more value from them. Good employees are in demand in any economy. After all, nobody strives to be the "second-best" at something. Churn decreases with more customer care, 5. In fact, 14 Ways Technology Will Affect the Future of Customer Service, Move Over Chatbots, Meet Virtual Assistants, 7 Tips for Optimizing Your Transportation Management System. Good customer service is an essential ingredient in retail because if a customer feels valued, they are more likely to not just stay with you but they will also recommend you to others and the importance of ‘word of mouth’ referrals should never be underestimated by any retail company when it comes to increasing your sales and customer base. How important is customer service for a business? After all, it's the direct connection between your customers and your business. additional products with less friction. Great customer service leads to happy customers who talk about your product or service with future customers. By providing good customer service experiences, your customers will associate that good feeling with the transaction. In comparison to, possibly, hundreds of competitors with similar products and services, your company has to do more than relish in the exciting features of your products. Customer service is the support you offer your customers — both before and after they buy and use your products or services — that helps them have an easy and enjoyable experience with you. As said before, it's a lot cheaper to retain an old customer than to acquire a new one. Marketing automation software. They can use your CRM or ticketing system to look up customers who have had this problem in the past, reach out to them via the service ticket, and introduce the new feature as well as its benefits. Aside from that, below are a few more reasons why you should invest in your customer service team. When you build a brand awareness strategy around customer loyalty, you’ll see authentic and sustainable growth. Work gets done faster, productivity goes up, and both employee and customer sentiment thrive in a more collaborative environment. Place the ultimate emphasis on your customer, then move through each department to align them behind customer service. Remember, it is six times more expensive to acquire a new customer than to retain an existing customer! Don’t miss out on the latest tips, tools, and tactics at the forefront of customer support. Retention correlates to customer satisfaction, 4. Free and premium plans, Sales CRM software. Customer satisfaction is important because it provides business owners and marketers with the metric to manage and improve the business. Happy customers build a better reputation, 3. It's natural; you want your close ones to commit to a brand that you trust. I don’t need to convince you why customer service is important. Their ability to communicate directly with customers can totally revolutionize your company and grow your customer base. Good service encourages one-time customers to become regulars. Without your customer service team, you have no means of direct communication. Anyone who is serious about making considerable headway in business needs to understand why customer service is so important. Take customer service, for example, everybody knows, whether intuitively, by experience, or from reading about it, that customer service is a crucial aspect of any successful business. When everyone at a company has the same end-goal, the entire workflow becomes streamlined. Or, at the very least, they'll share their positive experience with others, which builds rapport with your customer base. Churn measures the amount of customers who leave a business after purchasing. Customer service can make or break your business and the choice is yours. Current customers can refer business and prospects can become customers. Company culture exists whether or not you define it. Maybe you’re up for a promotion and want to show your boss exactly why customer service is important to their bottom line. The best way to sustainably grow a company is through word-of-mouth. The keyword in that chart is “working.”. This makes new customers more trustworthy of your business and allows you to. Even the quality and the nature of providing customer service from company to company in service industry. Not only do they purchase more, but they also bring in new business. Thus, that team has the responsibility of representing your brand to them. Business owners take a huge risk when founding a company. 75% of people would return to a company with excellent service. When you master not just attracting customers, but retaining them, it sets a solid foundation for your entire organization. This is because repeat customers are more likely to spend more with your brand -- 67% more, to be exact -- which then results in your business having to spend less on operating costs. It doesn't matter how you perceive your brand. CLTV improves with better customer service, 6. Especially at startups, employee happiness goes beyond a paycheck (and I’m not talking about snack perks). Satisfied customers are more likely to share your content across social media. And, when your customers are happier, they're more likely to spread the goodness to friends, family, and coworkers. The importance of customer loyalty impacts almost every metric important to running a business. These data points reveal a more specific breakdown: Highly engaged customers buy 90% more frequently, spend 60% more per transaction, and have 3 times the annual value compared to other customers. Services have flaws. Rather than push them right into the enemy’s arms, focus on excellent customer service to prevent customers from churning. Customer Retention—and Increased Revenue Satisfied customers are … New customers (as we’ll talk about below) tend to cost more to acquire, and don’t spend as much money as loyal, repeat customers. Then be more likely to come back and transact with your brand and refer others to it privacy...., compassion, and you want your customers customers lead to word mouth. Purchase from you because they associate your brand and positioning campaigns 's also an effective tool... In more stable revenue and more accurate predictions reputation, start with service. Happy results in more stable revenue and more accurate predictions businesses grow offering. 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