On a ratio of 1 to 12 – the critical role of effective customer service in the success of the business
Why it is important to establish an effective customer service system on the way to turn the customer into an ambassador and a marketer of the business.
One of the most interesting facts known to experienced company owners and marketers is that recruiting a new customer costs 12 times more than retaining an existing customer. The ratio is simply amazing considering the high customer acquisition cost the same businesses invest in in order to increase their sales. A simple math shows that for every shekel a business owner spends on customer retention, they spend 12 shekels to recruit a new customer. Conclusion – businesses are actually already familiar with their next customer, who has already bought from them and / or received service from them and now all that is left to do is to act in order to increase the – ARPU and maximize the sales processes. A key axis in the process is customer service and customer retention.
Customer retention as a critical point of contact between the customer and the business
The company’s customer retention and service system is at a central and sensitive junction in the customer-business relationship.
Once the sales process for the customer is complete there are two main expectations:
● Receive a good product and / or service and the knowledge that they have made a good and affordable deal for the price they paid
● In the event of a malfunction or need for service, the customer expects to receive the best service and avoid frustration.
In fact, you can see large and reputable companies doing a great job in their sales lineup but failing when it comes to healthy communication with their customers down the road and creating antagonism, frustration and bitterness for the customers, which may manifest itself in negativity and causing reputational damage to the company which is very difficult to repair.
The positive side of successful customer retention is the creation of a meticulous process during which two things happen:
● Creating an additional source of revenue from the customer in any contact-making process while offering additional services and products.
● Turning a satisfied customer into a marketing “ambassador” for the business and thereby producing effective word of mouth marketing.
The basic principles of effective customer retention
The customer service and retention mechanism is based on a number of basic principles:
● Adherence to schedules – Always reply to the customer within the time promised to them during the conversation with the representative.
Adherence to schedules is carefully examined by the customer and is for them not only an indication of the quality of the service but also the professionalism of the staff.
● Fulfillment of promises – This is a section that has a very important meaning for the customer. The customer’s expectation is that if they were promised something during the conversation with the company representative, the company will stand behind their promises and do everything in order to meet them to their complete satisfaction. Deviation from this principle presents the business in a very negative light and creates understandable frustration and antagonism.
● Do not “talk rubbish” – The phenomenon of “talking rubbish” to customer is familiar to many customers. The feeling that the representatives are leading them in a “service bypass route” or providing misleading information is fertile ground for friction between the customer and the business and creating a particularly negative image. The best customer information and solution should always be provided and the best solution suitable to them.
● Do not underestimate – Never underestimate a customer, see them as someone who does not understand and create a feeling of inferiority for them. Such behavior creates an understandable sense of distance and is difficult to correct later on.
The goal – to make the customer the best salesperson for the business
Quality customer service creates much more than a satisfied customer for the business; it produces a sales person who attests to the quality of the company. The customer becomes a particularly efficient salesperson who distributes the gospel at no cost without expecting a return. For this reason, the customer should be given the feeling that they are special, that they are an important asset for the business and thus strengthen their positive feeling.
However, the real greatness of professional customer retention is providing service even when it is understood that the caller is not a potential customer but needs service only. In such moments, a healthy and positive relationship is created between the customer and the business and increases the chance of a sales interaction later on.
