The main factor influencing the clients’ loyalty is the service – the best proof here are the results of classic research concerning the reasons why the clients join rival companies: in 69% cases it is because of unsatisfactory customer service.
Second example is Canadian Imperial Bank of Commerce, claiming that “using the Service- Profitability Cycle, has demonstrated that each 2% increase in customer loyalty generates an additional 2% in net profit”.
Latter (mostly in private sector) can be measured through sustained profitability, efficient recourse utilization, “higher levels of customer / client / user satisfaction, reputational enhancement that, in turn, generates grater public confidence”.
One of the proofs of this cycle could be the example of Sears and its US mail order business.
Research has shown that “5% gain in employee satisfaction drives a 1% gain in customer satisfaction which, in turn, leads to an additional 0.5% increase in profit”.
However, there arises a question if the expenditure on improving and then keeping high level of customer service will not be bigger than the possible income increase resulting from these actions.
It is not so because of a simple reason – good customer service does not require big investments but creating the proper culture of contacts with clients in the company and maintaining it on the same level.For every example of great customer service, you’ll easily find a bad example too.You’ve probably already dealt with your fair share of customer service fails - I know I have.Those results make the employees think about innovations and eliminating mistakes.The rest becomes the culture of the company and so it drives itself on.It helps business to win clients in an extremely competitive environment nowadays and it facilitates cost–saving.Large amount of research executed around the world demonstrates that investments into customer service and people yield enhanced organizational results, so there is a high correlation between the customer service quality and profitability.Customer service relates to the service you and your employees provide to customers before, during and after a purchase of your goods and services.This can include things such as how you interact with your customer, and how you resolve any issues that may arise.At Userlike we like to focus on the positives and how you can deliver the best service with the best tools and practices.But it’s also useful to look at some negative experiences and the lessons one can learn from them.