Every company has its ups and downs, but it is the ones that learn from their bad episodes that become successful. As a business owner, you need to understand there are 3 main phases of a difficult situation:
While each of these phases is important, it is the last one that carries one of the most valuable pieces of information. It can show you the cause of the problem and if you managed to find the right solution.
In customer service, learning from past experiences is crucial for the business growth process. It helps you see what went wrong, what customers were expecting from you and where you failed to meet their expectations. It makes a difference between poor customer service and excellent service.
In business terms, poor customer service can be described as badly managed situations, support representatives who lack experience and processes that do not work properly. From a customer’s point of view, it can be defined as “I will never work with this company again!“, “I don’t recommend you this company!” and “I’m never calling them again!”
In other words, it refers to unpleasant experiences which motivate customers not to return to or recommend a particular business.
Poor customer service has a strong impact on your customers and your business. In order to understand it better, let’s look at a few poor customer service facts and see what you can learn from them.
According to the 2014 Global Customer Service Barometer, when asked if companies meet their expectations in terms of customer service experiences, 62% of the participants responded affirmative. Comparing it with the last years, there is a decreasing tendency, as in 2010, 65% believed businesses met their customer service expectations.
More and more customers consider companies miss their expectations. While in 2010, 20% gave this answer, in 2014, it grew to 29%. On the last place come the ones who feel companies exceed their expectations: 5% in 2014, as compared to 7% in 2010.
Lesson: Knowing your customers and understanding their needs stand at the basis of your customer service. You can learn more about them by asking for feedback through email surveys or phone interviews. Also, you can monitor their activity on your website and social media platforms. Look at what they say in their comments and messages to get an idea of what they want from you.
The same report shows us customers think businesses are paying less attention to provide good customer service. In fact, in 2014, 38% said companies pay less attention, as compared to the 28% in 2010. Regarding the ones who have the opposite opinion, in 2014, 29% considered businesses increased their attention. Still, the number decreased from 2010, when 37% affirmed the same thing.
Lesson: It is essential to always keep your standards high. Providing excellent customer service is more than a strategy, it is a way of doing business. Pay attention to your response time, what problems customers encounter and how much you manage to help them.
Customers can either recommend your company or advise their close ones to stay away from it. When asked how often they tell others about their poor experiences, 60% answered all the time. Also, customers tell, on average, 8 people about their positive customer service experiences and 21 about their negative experiences.
Lesson: Word of mouth is a powerful tool in customer service. Always remember if one customer is not satisfied with what you offered, other 21 potential ones will know about it and most probably choose your competitors.
According to Harris Interactive, customers said support representatives didn’t manage to fulfill their requests 50% of the time. When this happens, they may look for alternatives in other places. Bain & Co. shows a customer is 4 times more likely to go to your competition if they have better customer service. Price and product quality come below this criterion.
Lesson: Stay open to your customers and let them know you are always there to help them. Sending them follow-ups to see if your information was useful or if they encountered other issues is a great way to properly fulfill their requests.
When you lose customers, you may want to focus on acquiring new ones. It will cost 6 to 7 more to acquire a new customer than to keep an already-existing one.
Lesson: Customer retention plays an important role in growing your business. Customers who have already interacted with your business know about your offerings, are easier to retain than new ones and have a high value. A 5% increase in customer retention can lead to an approximate 95% increase in profit.
Research shows us if customers experience an unpleasant episode with your business, they will most likely not work with you the next time. 60% of Global Customer Service Barometer participants said they didn’t make a purchase because of a bad customer service experience. Another study conducted by Lee Resources shows 91% of customers will not willingly work with a business after a negative experience.
Lesson: A popular saying tells us “You do not know the value of something until you lose it.” It’s the same with customers. They are fundamental to your business and its development. Listen to what they are saying, always ask for feedback and be open to changes. It’s a great way of keeping your customers close and poor customer service away.