As a business leader, do you know the primary factor setting brands apart in competitive fields?
The answer is a customer-oriented focus on providing good customer service and a personalized customer experience. Today, customer service is the new battleground where companies are fighting for customers; 96% of consumers say that customer service is important in their choice of loyalty to a brand.
Why Customer Service Matters
Customers want to feel like a brand is receptive to their needs and responsive to their concerns. In order to set themselves apart from others in the field, brands need to cultivate a personal connection with customers that extends beyond financial transactions. Best practices include:q
- Maintaining a website that is easily navigable and mobile-friendly
- Timely addressing and resolving online comments, questions and reviews (especially negative ones)
- Providing surveys and web forms to collect customer feedback and concerns
- Having friendly and knowledgeable service reps who are able to answer customer questions (or find the answers for them)
- Being responsive across multiple channels: live chats, website forms, social media, email and call centers
- Publishing relevant and useful content for customers to easily access more information about products and services — this might include blogs, white papers, video and more
By proactively cultivating good customer relationships, companies will increase brand trust and loyalty, customer retention, customer satisfaction, brand exposure from customer promotion and revenues.
In 2020 here are the facts you need to know about customer service and the customer experience, along with the numbers to back them up.
1. Good Customer Service and a Positive Customer Experience Influences the Purchasing Decision
Good customer service is no longer a take it or leave it perk for businesses; it’s an important factor that’s driving purchasing decisions among Americans. According to American Express, 70% of American consumers have spent more money to do business with a company that has great customer care. They’re willing to spend over 17% more on businesses that deliver quality service.
And when customers aren’t happy with the service they receive? More than 50% of them decide not to go through with a purchase due to a bad customer service experience, says American Express. Furthermore, when customers are unhappy there’s a 91% chance they won’t do business with that company again.
2. Customers Care as Much About the Experience as They Do About the Price and Quality of Products
Today’s customers want to invest in brands that provide a personalized experience and they seek brands that offer value outside of a single purchase — value like excellent customer care. Companies need to tap into what their customers care about and what they want out of their experiences, because Walker predicts that customer experience will differentiate a brand more than price or product will by the end of 2020.
McKinsey’s 2017 customer experience report states that today’s customers are not simply buying products and services. They are buying into an idea or experience and their purchasing decisions reflect their satisfaction with customer care.
3. Good Customer Service Increases Customer Retention
Customer acquisition is more expensive than customer retention — even up to 6-7 times more expensive. But good customer service policies can help companies keep loyal customers. HubSpot Research shows that 93% of customers are more likely to make repeat purchases at a company that provides good customer service. And investing in retention pays off; studies by Bain & Company show that a 5% increase in customer retention can lead to a 15-95% increase in profits. As you retain loyal customers who make repeat purchases, the costs for providing service to these customers decreases — which in turn increases your overall return on investment.
4. Reviews About Customer Experience and Customer Service Impact a Company’s Reputation (and Sales)
Today, online reviews matter more than ever to customers making purchasing decisions. According to Zendesk, 88% of people have been influenced by an online customer service review when making a buying decision. Online reviews have major effects on a business in both directions:
- Via word of mouth, Americans tell an average of 15 people when they receive bad customer service, and an average of 11 people when they receive good service
- Via social media, 49% of people post about a bad experience, while 38% of people post about a good experience
- Via online reviews, 46% of people post negatively about bad service, while 27% of people post positively about good service
Bad reviews can seriously harm a company: it takes 40 positive customer experiences to make up for 1 negative review. But good reviews can have a lasting effect: loyal promoters have a lifetime value of 6 to 14 times that of detractors.
5. Good Customer Service Drives Revenue
In their 2017 customer experience report, McKinsey states the following: leading businesses that promote a focus on the customer experience stand to achieve revenue gains of 5-10% and reduce costs by 15-20% within 2-3 years. Similarly, research by Bain & Company found that business leaders in customer experience increase revenues by 4-8% above their market. Why? Because providing a good customer experience increases your base of loyal customers who will come to you for repeat purchases and refer you to their friends.
Contact NewGen Marketing to Discuss Your Company’s Marketing and Sales Needs
NewGen Marketing is a sales and marketing agency that uses performance-driven strategies to grow your brand, generate quality leads and drive leads through a conversion funnel that results in sales. We rely on performance-driven results to determine which campaigns are successful and where we can make adjustments to optimize performance. You’ll know every step of the way where your marketing dollars are being spent to help drive more to your bottom line — and your ROI will reflect how effective performance-driven strategies are.
Contact NewGen Marketing today and schedule a consultation to discuss marketing and sales strategies that will optimize your ROI.