Archive for the ‘customer loyalty’ Category

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How do you measure the effectiveness of customer service?

Thursday, March 17th, 2011

Is it enough to measure customer issue resolution? If there are 100 calls, and 99 took care of the problem, does this mean your customer service is operating at 99% effectiveness? In a sense, yes. But there you may want to measure other dimensions of the interaction.

According to an article in the UK-based CallCentreHelper.com, “Customer service is key to ROI,” you should also be looking at harder to measure issues such as customer perception of your organization. These conclusions are based on a 12-month study conducted by The Institute of Customer Service.  Jo Causon, CEO of the Institute said the following:

“To position return on investment in the boardroom and establish customer service as a key strategic issue for all organisations, we must shift customer service away from just measuring simple customer satisfaction into much more complex areas, such as how customers perceive the value of their relationship with that organisation.”

Other areas to measure include how the customer service representative perceive the transactions.

Every organization should invest some time and effort in measuring the effectiveness of customer service.  What would make for an effective call for your organization? Problem-resolution? Speed of problem resolution? Happiness of customer?  Determine what benchmarks will be important to measure against over time.  You will also have to decide when and how often you will measure customer interactions. Is it a monthly, quarterly or yearly measure? Will it be done at the end of every customer interaction or via follow up phone call or mail questionnaire? These measure will yield quantitative results. To get more qualitative data, you may need to have focus groups or more in-depth interviews.

Measure effectiveness to determine if you are succeeding, and certainly, to see whether customers are satisfied.

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Yes, people do care about customer service

Tuesday, July 27th, 2010

It seems that many companies have not yet caught on to the reality that people care about customer service. People will shun a company if it provides bad customer service, and sometimes, they will publicly (and with the power of social media) complain about it.

Last week, the news came that Facebook is rated as one of the companies  with the worst customer service. The conundrum is that it is also one of the fastest growing companies with a very large customer base (500 million people worldwide). Although people keep using the social sharing website, they are not happy about it. Will this have repercussions?

The perceived decline (and complaining about) customer service is not relegated to the United States. Writing in the Sydney Morning Herald, an Australian blogger writes about her difficulties in getting any type of help while shopping for clothes.

And yet, as we have discussed previously on this blog, customer service is a differentiator for businesses and can help the bottom line.  Julia Clarke, writing in the Australian blog Dynamic Business, concurs.  She says:

Australia’s small businesses can use exceptional customer service to attract customers away from big businesses, a new survey has found.

People care about customer service, they rate companies based on customer service and they reward the companies that make customer service a priority.  It is that simple.


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It’s monetary!

Wednesday, July 7th, 2010

Customer service has become a differentiating factor, making it easier for people to choose between businesses. Better customer service generally gets more customers.

If just to increase your bottom line, your organization should be paying attention to customer service. As a blog post  entitled “Companies That Ignore Customer Service are in Trouble” on Benzinga indicates,customer service can increase stock price:

Have you noticed the companies with a reputation for great customer service are also the companies that have seen better performance out of their stocks during these difficult fiscal times? Think of Southwest Airlines (LUV:NYSE) and Apple (AAPL:NASDAQ) – companies known for going above and beyond for their customers all the while their stocks have appreciated 65% and 86%, respectively, over the past year.

The post makes the point that excellent customer service is a low-cost way to increase your profit. Making customer service a priority can really impact a company’s bottom line in the present, but also for future business. Customers are more likely to do repeat business with a company that has treated them well in the past.

In fact, according to findings in the American Express Global Customer Service Barometer survey, 91% of customers surveyed said that customer service is  a factor they consider when deciding to do business with a company, and will spend, on average 9% more when they receive excellent service. Read more about how the survey was completed and other interesting information gleaned from this study here.

These eye-popping statistics are really proof of how important customer service is to a company’s bottom line. To ignore customer service is to throw potential business away.

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Lessons from a customer service survey

Thursday, May 20th, 2010

MSN Money conducted its fourth annual customer service survey, where it found the top ten companies for service in the United States, and the bottom ten. You can read a recap here.

From the survey, the companies that did best had all or several of the following attributes:

  • Providing a positive experience in the store (for retail outlets)
  • Having knowledgeable staff
  • Fair pricing of products/services
  • Providing quality services
  • Promotions that make customers feel appreciated (like checking baggage for free on Southwest Airlines)
  • No taking customers for granted
  • Not penalizing customers excessively with fees and add ons
  • Avoiding surprise charges
  • Reducing customer’s stress
  • Delivering what is advertised

What ties these attributes together is that they are customer-centric, rather than company-centric. When companies forget that they are working with customers, and become too focused on bottom-line concerns, customers notice and complain or even defect. Companies that did poorly on the survey seemed to not practice these “rules” but to do so over the long term.

What are you doing to ensure you customers remain satisfied?

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Customer service is about loyalty

Tuesday, May 4th, 2010

Inc. Magazine recentlyreviewed the book Exceptional Service, Exceptional Profit (AMACOM, $21.95) by Leonardo Inghilleri  and Micah Solomon.  As its title implies, this book links customer service to the bottom line.  The main gist is that customer service wins over customers and creates loyalty. Loyal customers will remain with companies that they like.

Micah Solomon, one of the book’s authors, recently wrote the article: Seven Keys to Building Customer Loyalty for FastCompany magazine.  According to Solomon:

A personal bond with customers lets your company escape the commodity pricing wars and provides you with a powerful new marketing arm: loyal customers who will promote and defend your company online and off–for free.

Clearly, loyalty pays off two ways: in direct sales to the customer but also in “free”  promotion.

Solomon’s seven keys are:

  1. Good first interaction
  2. Speedy service
  3. Personal customer care (no robots)
  4. Remember customer’s preferences
  5. Anticipate wants/needs
  6. Train your team on the proper way to speak to customers
  7. Work hard to find suitable customer service employees

Even though going the extra customer service mile may cost more in the short term, the loyalty that it can build will pay off in the long term.

What are your thoughts on building customer loyalty?

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How to handle problems

Thursday, April 29th, 2010

Many times, though definitely not all, customer service is about handling problems. Customers may be unhappy with something or someone. Customers may want money back or have issues with their bill. In short, customers will turn to customer service to resolve problems. It stands to reason that it good customer service knows how to handle and RESOLVE problems.

Additionally, when customer service is able to handle problems and perhaps resolve them, customers will be happier, and this helps encourage their loyalty.

Inc. Magazine has a useful article entitled “How to Handle Customer Complaints.” In the article, author Tali Yahalom gives various tips. Among them:

  • Listen first (and allow the customer to vent)
  • Treat a customers as a person not a number
  • Look for a fair solution
  • Respond in writing when appropriate

This article is definitely worth reading, as are the resources Yahalomi provides.

Everyone can learn to better handle problems. The better your customer service is at handling problems, the less negativity will exist, even from unhappy customers.  As we have written before on the blog,  customers have the tools to share negativity far and wide through social media. One unhappy customer can turn into many people with a negative view of your company. Resolving a problem in a fair and quick way will help prevent customers’ unhappiness to spread.

How do you handle problems? What is the best advice you can offer?

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The extras

Thursday, March 18th, 2010

Good customer  service involves making sure the customer has a good experience with your product or service, including if there is a problem with your product or service.  However, there are many things that make your customer service great, taking it to the next level.

In high-end department stores, customers may be treated to special services like personal shopping or tailoring.  In the airline world, frequent fliers accumulate miles and special treatment. The more miles you have flown with a certain airline, the higher your status with the airline, which means you get preferential treatment. Some will argue that this is not customer service but rather customer loyalty or retention programs.  Even so, it all is part of aiming to make certain customers are pleased with their interaction with your company or organization.

The Atlanta Journal-Constitution reports that Macy’s, the national retailer, will be ending gift-wrap services.  Macy’s blamed the cost and the small number of customers who used this service. Yet critics like Pam Danziger, president of Unity Marketing, disagreed that this was a good place to practice cost cutting:

Danziger said department stores like Macy’s need to set themselves apart from the discounters by “recapturing the customer-service experience and delivering it to their customers.” She says customers will pay more for quality service that extends to walking out the door with a perfectly wrapped gift.

Many would argue that gift-wrapping is one of those extras that make something more special. Can you gift-wrap at home? Of course you can, but it looks (and feels) much better when it is done for you.  On the other hand, perhaps Macy’s no longer is a high-end retailer that owes its customers this particular extra service.

Extras add something special to service. The question remains: which extras are worth the investment?

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Daily practice

Thursday, February 11th, 2010

Customer service is akin to exercise, the more you do it the better it is for you (and for your customer). And, as David Evans, chairman of the Grass Roots group, says, customer service should be practiced every day. Evans, who is interviewed in the article Customer Service to be Practiced Every Day, in the U.K.’s Economic Times,  concludes the following:

a consistently well-delivered product or service at good value goes much further than programs that focus on retaining customers with “bribery.”

To Evans, customer loyalty programs are the “bribery.”  The article says that Evans:

doesn’t care for loyalty cards and says price-driven loyalty is often the lowest form of loyalty. Instead, Evans tells his clients that the best way of retaining customer  is to enhance the overall value of their product or service.

In sum, maintaining a customer relationship is about offering a quality good or service, consistently. People will seek out the better product or service.

What do you think?

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Eyes on the prize

Thursday, December 31st, 2009

Perhaps the main reason exemplary customer service is good for the bottom line is that it builds loyalty.

In the new George Clooney film, Up in the Air, Clooney’s character flies on one airline exclusively, with the goal of reaching the most elite frequent flier status. Very few people get there, and there are fabulous rewards to be had.  The movie shows the process of building this type of intense customer loyalty. The airline rewards the frequent flier with perks, trips, special check-ins,  being greeted by name, and in turn, the flier chooses to fly that airline exclusively. It’s a win-win situation.

Strong, attentive customer service begets customer loyalty. It is that simple. Loyalty is the ultimate prize companies are seeking.

In 2010, ARMA will continue to keep our eyes on the prize: your loyalty, and the loyalty of our customers. We know it doesn’t come easy. We work hard to get it and to keep it.

ARMA wishes our readers a very Happy New Year 2010!

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