Virtually all businesses acknowledge the importance of customer satisfaction – it’s usually right there in the mission statement. But the way businesses handle customer service has a more direct impact on the company’s bottom line than many people realize. A Harvard Business Review study recently quantified the value of the customer experience, demonstrating that delivering excellent support generates high returns.
The Harvard study suggests that the best way to retain existing customers and generate new business is to consistently provide a positive customer experience. In an increasingly competitive marketplace, companies must find a way to stand out from the crowd. And as a Forrester trend report noted, customer service is moving from cost center to differentiator.
Customer support executives who are looking at ways to improve satisfaction need resources that enable their team to quickly resolve customer issues. They also need to be aware of exactly how customer service affects profitability. Here are the top five ways customer support impacts bottom-line results:
1. Happy customers spend more money. The Harvard Business Review study shows that customers who said their experience met or exceeded their expectations spent approximately 140% more than customers who reported a negative experience.
2. Dissatisfied customers require costly support. Resolving issues for unhappy customers is expensive, particularly if they require extensive agent support. Every time a customer contacts support, returns a product or requests a refund, it costs money.
3. Satisfied customers remain customers longer. The Harvard study shows that members who report high levels of satisfaction have a 74% chance of still being a customer a year later while only 43% who rate their customer experience as poor stick around for another year.
4. Dissatisfied customers share their disappointment. Thanks to social media platforms, one unhappy customer can now instantly reach millions of potential customers. Dissatisfied customers tend to share their negative experiences with friends – and the whole world.
5. Customers expect speedy resolution. Customers don’t like to waste their time explaining their issue repeatedly or providing their name and account number over and over – that counts as a negative experience, which reduces satisfaction and profits.
Business leaders have always known that customer satisfaction has an impact on the company’s bottom line, but the Harvard study shows that it’s possible to quantify the effect. Customer support executives can use that knowledge to make the business case for resources that help them drive customer satisfaction and consistently deliver a positive customer experience.
When considering options, it’s important to keep collaboration in mind. No single team member has all the answers, but when the customer support group can access the collective knowledge of the entire company to resolve an issue, they can solve problems quickly. That boosts customer satisfaction, according to a Forrester report on the value of social business and collaboration. It’s also critical to look for a solution that features a central database and can integrate with other business systems. With a shared platform, teams can eliminate data silos and ensure that they understand who the customer is, what products are involved and what actions have already been taken.
Customer support excellence is important in any sector, but the effects are magnified in the B2B world, where support agents aren’t just handling resolution of a ticket for an individual but are directly contributing to the health of the relationship between the two companies – the customer and the vendor. By understanding how customer satisfaction impacts the bottom line, companies can set themselves up to compete – and win.