Customer Service: Essential Principles

The quality of customer service is the core differentiating factor between good, bad and indifferent companies. Sound customer service keeps customers coming back. Bad customer service drives customers away and takes their friends, family, and colleagues with them.

When all else is equal, good quality customer service provides an edge over competitors. No matter the industry, here are nine essential principles of good customer service that always make sense in the business world.

1.) Attracting New Customers Costs More than Retaining Current Customers

A satisfied customer typically stays with a company longer, spends more and may deepen the relationship. For instance, a happy credit card customer may enlist the company’s financial services and later take travel insurance. This is an easy “sell” compared to direct marketing campaigns, television advertisements, and other more expensive means of attracting new customers.

2.) Customer Service Costs Real Money

Providing customer service entails real costs. Companies typically spend in line with a customer’s value. If you are a high-value customer or have the potential of being high value, you will likely receive higher quality customer service. Companies can reduce the cost of customer service by using telephone voice response systems, outsourcing call centers to cheaper locations, and self-servicing on the internet. However, companies risk alienating customers by providing an impersonal service. Some internet banking companies are bucking the trend by charging customers to contact them. In exchange, customers receive better interest rates due to reduced overheads and are satisfied with that.

3.) Understand and Meet Your Customers’ Needs

If you don’t recognize and understand your customer needs, then it’s next to impossible to meet them. In order to better understand your customer’s needs, all you need to do is listen to them and respond. You can accomplish this in any number of ways. A few examples include feedback forms, mystery shoppers, and satisfaction surveys. Some companies involve senior employees when it comes to customer listening to make sure that decisions benefit the customer as much as the company.

4.) Good Process and Product Design is Essential

Quality customer service is only one element that contributes to meeting customer needs. Well designed products and processes will also meet customers’ needs in many cases. High-quality tactics, such as Six Sigma, consider the “cost of quality” resulting from damaged processes or products. Consider the following: is it better to service the customer well than to eradicate the reason for them to contact you in the first case?

5.) Customer Service Must Be Consistent

Customers expect a steady flow of quality customer service. Customer service needs to be similar and provide a familiar look and feel whenever they contact your company.

Say for instance you visit a high-end hairdressing salon in your hometown and receive a warm welcome, a beverage, and a quality haircut. This is an overall superior experience in terms of customer service. Next, you’re out of town and visit the same hairdressing chain. However, this location does not greet you with a smile, nor a warm welcome, nor a beverage, yet the final end product is the same high-quality haircut. Based on this secondary experience, are you likely to return to either hairdresser in the future? Probably not. Why? You did not receive the same level of customer service, which is far more important than the end product in most cases.

6.) Employees are Customers Too

The quality management movement brought the concept of internal and external customers to light. The focus is typically on external customers with little thought given to how internal departments interact. Improving relationships among internal customers and suppliers assists in delivering better customer service to external customers via reduced lead times, increased quality and better communication.

The Service-Profit Chain model developed by Havard University emphasizes the circular relationship between employees, customers, and shareholders. Under-staffed, under-trained employees will likely not deliver high-quality customer service. This, in turn, drives customers away. Furthermore, equal effort must be made in attracting, motivating and retaining employees as is made for customers. This ultimately delivers improved shareholder returns. Better shareholder returns mean more money to invest in employees and so the cycle continues.

7. Open all communications channels

Customers typically wish to connect with you in many ways: face-to-face, mail, phone, fax, and email. They expect these communication channels to be open and easily integrated. This presents a technical challenge since it requires a streamlined solution providing the employee with the information they need to effectively service the customer.

8.) Every Customer Contact is a Chance to Shine

If customer contact concerns a broken process, then empowered employees will have the ability to resolve the complaint quickly and potentially enhance the customer’s perception of the company. Receiving this feedback allows corrective actions to be made, which in turn prevents future instances of the same error.

If you inform customers of fresh products or services when they contact you. you may make a valuable sale. This turns your cost center into a profit center. This method is only possible when you have a sound relationship with your customer, where you truly understand their specific needs. A targeted sales pitch will have a strong chance of success, as the customer is already sold on the company’s reputation.

9.) People Expect Good Service Everywhere

Think about your average day. You travel on a train, purchase a cup of coffee, and you work at your job; expect the train to be on time, clean, and at a reasonable fare; and you expect your coffee to be hot and delivered quickly. You expect your colleagues to work with you, which enables you to get the job done. People become frustrated with their expectations are not met.

Providing outstanding customer service at the right price is the holy grail of most companies. Furthermore, it is worth remembering that we all experience customer service every day. We can learn from these and apply them in our own line of work, whatever it may be. The quality of service will make you stand out from your competitors – make sure it’s for the right reasons!

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