Businesses often concentrate on gaining new business and forget the need to look after the business they already have. According to Marketing Metrics it is 50% easier to sell to existing businesses than to brand new prospects. Delivering excellent customer service – over exceeding customer’s expectations and maintaining a relationship can benefit your business in a number of ways:
A customer who receives a level of customer service that exceeds their expectations is much more likely to purchase more products from your business over time. A relationship is formed with every sale you make and the better the service provided the longer the relationship will last. Good customer service reps will be able to answer any questions posed but also assess whether there is a chance of cross-selling and seeing if the customer may be interested in other products you offer. Companies that actively engage with customers and meet their needs and expectations will achieve greater customer loyalty. According to Bain and Co., a 5% increase in customer retention can increase a company’s profitability by 75%.
Recommending your business & Reputation
Customers who receive good customer service are much more likely to talk about and recommend your products to friends and family. This free advertising can lead to word of mouth sales and good publicity. Customer confidence in your business grows and increases the visibility and popularity of the products and services you provide. According to Lee Resource Inc attracting new customers will cost your company 5 times more than keeping an existing customer. Similarly if you offer poor customer service negative word-of-mouth can really hinder your business.
Standing out in the crowd
Most industries are competitive with competitors offering similar products or services to what you offer. By providing exceptional customer service you can set your business apart from your competition. Similarly, if you cannot afford to beat competitors on price then offering a better customer service can overcome this. An example being a local grocery shop compared to a national chain which can’t compete on price but can compete on customer service. The Small Business Success website indicates that customer service-driven businesses can charge up to 9 percent more for their products and services, and grow the business twice as fast as average.
Employees who understand the importance of customer-focused service and care about the total customer experience are invaluable. Happy employees will often lead to better customer service so it is wise to invest in aspects like training, empowerment and offering incentives to ensure employees are skilled, motivated and loyal. The happier your employees and consequently your customers are; the more likely they are to stay with your business.
Customer Service is a vital component of business and getting this right can ensure your business grows quickly. The importance of good customer service is shown by Garner Group who state that 80% of your company’s future revenue will come from just 20% of your existing customers.