Service business

How much does it cost to provide great customer service?

I recently wrote an article in Forbes on how to get customers to pay more. The emphasis was of course on service and customer experience.

Research has conclusively proven that customers will pay more for a better experience. Research has also conclusively proven that customers will leave you for your competitors if you are not doing them the service they expect.

One of my Forbes readers, Daniel Rodriguez, posted an interesting comment. He said, “What’s interesting is that better service correlates with greater customer willingness to pay, but that doesn’t mean a business has to spend more on CS to get these results.”

It reminds me of something my good friend Kim Tucci used to say, “It doesn’t cost much more to go first class. He wasn’t talking about upgrading a coach seat on an airplane to a first class seat. He was talking about how, in general, doing good, in a more elegant way, usually doesn’t cost much more, if at all. The same is true for some aspects of customer service.

First, the department that is often referred to as “customer service” should not be viewed as a cost center. Done well, this is what makes your business profitable. Customer service reps save angry customers and in many cases make sure customers come back. Yes, there are overhead costs associated with their salaries and the equipment and technology they use. But when they do it right, it costs nothing. It’s not free. Getting it right doesn’t have to cost more than the obvious costs just mentioned. To help you get started with that line of thinking, here are a few ways to do it right that won’t cost a lot of money, at least compared to the results you get.

  • Do it right the first timelike taking care of the customer so they don’t have to call back and start over. A call with a customer, even if it takes a little longer, costs less than two, or three or four, or even more!
  • Be nice. It was the subject of a recent letter from Shepard. Being nice doesn’t cost more, but it can pay huge dividends. I know… this is common sense. Unfortunately, this is not always that common.
  • Empower employees to make customer-centric decisions. It’s about empowering your team to take care of your customers. It takes some training to show an employee how far they can go, but once you’ve trained them, let them go ahead and be successful. Customers like to deal with people who can make decisions. It can be summed up in one word: accountability.

None of these ideas are expensive at all. In fact, doing it right the first time saves you money. It doesn’t cost anything to be nice. Empowering employees costs a bit as you have to train people on what they can do and how far they can go, but the payoff is big. In the end, how much does it cost to provide great customer service? Not that much!