by Warren G. Purdy
Associate Professor of Marketing
?The public is the only critic whose opinion is worth anything at all.? - Mark Twain
After a recent and rather unpleasant conversation with a ?customer service representative? from a large financial institution, I began to wonder what, if any, strides businesses are making in the provision of quality customer service.
I recalled a conference I had spoken at a couple of years ago attended by sales managers of a major oil company.? My presentation started with a simple question. ?In a recent phone conversation I had with one of the following organizations, a Customer Services Representative (CSR) told me to ?Go to H?.?? I then listed four businesses and had the audience select which organization they thought it was. The correct answer was AARP.? Believe it or not, that was the number one choice of the majority of attendees. I was very surprised, but probably should not have been as the three other choices I had given I had also had experiences with and would rate them as fair to excellent (their names will be withheld to protect the innocent).? This example was the setup for my talk on the potential impact of poor customer service, and how a single discrete negative experience may result not only in the loss of one customer ?(that could be bad enough if it?s a large one) but can have a multiplier effect, if the experience is bad enough.
Although customer service impacts our business at every level, I want to focus on the importance of the interaction between the CSR and customer? AKA customer service. A major reason this topic continues to be such a popular one today is because many consumers have shifted from a focus on pure price to our current environment where customers are looking for overall value. Customer service is a significant component of the? ?value equation.? ?In fact, meeting or exceeding customer demands for quality service is an arena where companies can set themselves apart from the competition.
If you ever had a doubt about the seriousness and/or potential impact of this issue, try these factoids on for size:
- ?A delighted customer is six times more likely to repurchase your product than a satisfied customer.?? John Anton, Center for Customer Driven Quality Purdue University.
- Only 4% of angry customers complain.
- On average, each of these ?angry customers? will tell 16 more people.
- From these 16, as the story is retold, the number grows to about 250.
- A recent three-year study by the National Federation of Independent Business (NFIB) showed that small businesses which put heavy emphasis on customer service were more likely to survive and succeed than competitors who emphasized such advantages as lower prices or type of product.
- According to the Customer Service Institute, 65% of a company?s business comes from existing customers, and it costs five times as much to attract a new customer than to keep an existing one satisfied.
- Some studies indicate that as much as 35% of new business comes from referrals.
- Losing a customer is even more expensive. According to studies by the Technical Assistance Research Programs Institute, 91% of unhappy customers will never buy again from a company that has displeased them.
Now I guess the $ 64 thousand dollar question is:? What can you do to improve your company?s customer service? ?I guess we?ll have to wait for another blog posting!
Finally, never make me angry because I might mention you in an article or blog like this!
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Source: http://usmschoolofbusiness.wordpress.com/2012/02/16/you-said-what-to-our-customer/
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