Businesses should treat customer service as an intangible company asset: one that is as valuable and important as any product held in inventory. Customer service may not be a physical product in a warehouse or on the sales floor. It may not be directly purchased at the point of sale. However, customer service is part of every transaction. It can influence existing customers, draw in new ones, and increase the spending of both groups. Within reasonable limits, raising the level of customer service raises the level of profit. The appropriate level of customer service is the one that satisfies patrons while increasing revenue.
Determining exactly how customer service can increase revenue is not always obvious. Improved customer service may not appear to have immediate results. It is necessary to consider a broader picture. For example, improved customer service in one area may result in the retention of customers who will return to purchase additional products and services. Often, these additional purchases may be in completely different areas than the initial interaction. Sometimes, the additional purchases will be larger, more valuable, or involve a higher profit margin.
Patron satisfaction is easier to observe and measure. Survey information is probably the most popular means of collecting data to evaluate the level of customer service. Mathematical formulas can be applied to calculate the percentage of products delivered on time and undamaged. Customer retention and attrition can also be measured. The challenge in this area is not in measuring customer service; it is in targeting and reaching a correct level of customer service.
When evaluating increased revenue, exact one-for-one dollar amounts may be less accurate than possible correlations within the larger profile of a company. Many systems and examples exist to help businesses conduct these studies. As long as a positive correlation can be found, and earnings continue upward, the level of customer service is in the appropriate range.
The cost of training employees can be viewed as an investment rather than an expense. When service workers can employ active listening, questioning, and problem-solution methods with customers, customer service levels are increased. When rewards are given for attention to customers’ needs rather than speed of processing orders, a customer-service culture is created. When decision-makers are willing to review and change longstanding traditions they demonstrate a commitment to customer service. As these and other strategies become fully integrated into company policy, the relationship between satisfaction and profitability may become evident.
Establishing the appropriate level of customer service requires creating a culture of awareness, communication, and training. Managers and employees should all be properly trained in customer service strategies. Customer service goals and profit data should be shared openly so that all members of the company can view progress toward goals. Everyone in the corporation, from owner to part-time intern should share a commitment to customer satisfaction, because they should all value it as an important part of doing business.
In short, the company as a whole should be able to view customer service as an asset that can be managed, measured, and improved. The appropriate level of customer service will be clear to all when both profits and patron satisfaction increase together.
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