No matter your industry or sector, your business is competing to find and retain as many customers as possible. However, companies RETAIN customers by providing an excellent customer service experience. Poor customer service can not only affect your bottom line, but it can also affect a company’s brand and overall reputation. Similarly, superior customer service can transform your customers into passionate ambassadors and lead to more revenue.
In 2021 and beyond, customers look for organizations to address their needs and complaints better than the competition. It’s no secret that they will turn to other options if they feel underappreciated or if their concerns aren’t being addressed properly. Here, we examine all the ways that excellent customer service can affect your business positively.
A Better Reputation
We all know that improving the customer service experience can lead to a much better reputation for your company, but why exactly is this important? Sure, it can lead to more customers and revenue — but that isn’t all. If your customer service is excellent, it leads to a lot more than just happy customers. It also means that your company will have a better reputation when compared to the competition.
For example, an excellent reputation in your industry can lead to increased interest from investors. This is critical for business owners and entrepreneurs hoping to scale their company and take it to the next level. Also, a strong reputation as a company can lead to more high-profile partnerships and can also help you attract more high-value employees.
More Referrals
Let’s say that you exceed a customer’s expectations, and they are happier with your company than ever before. There’s a good chance that one customer will tell their friends and/or family about the experience and end up recommending your company’s product or service. While digital marketing is more critical than ever before, the truth is that word of mouth still matters. Nielsen, a global marketing research firm, concluded in 2021 that 92% of consumers worldwide still trust word-of-mouth recommendations.
Customer referrals are crucial for one undeniable reason: they don’t cost anything! Many businesses spend thousands of dollars per month- or even millions — to educate and inform consumers about what they have to offer. Delivering an exceptional customer service experience can lead to actual referrals, which leads to real revenue.
Increased CLV
There’s one critical metric in the business world that some experts would say isn’t discussed enough, and that would be CLV. For those who don’t know, CLV stands for customer lifetime
value. This term refers to the amount of money a customer is predicted to spend with your business, and it helps predict the net profit that your company makes off one customer over time.
It’s easy to see how superior customer service can improve CLV significantly. If your company offers a poor customer service experience, this customer may leave after one or two months. A superior customer service experience might ensure that the customer stays with you for several years. A higher CLV means that your organization can grow quicker, with more insight into your customers than ever before.
It’s much less expensive to attract new customers than retain existing ones. A customer is also willing to spend more with a company that provides a quality customer service experience. Calculating the CLV can help your business estimate future revenue, calculate customer life cycles, and inform future marketing/advertising campaigns.
