The Real Value of Good Customer Service

by QuickBooks

1 min read

Offering good customer service can reap rewards — but just how much?

Turns out it can be a lot. Seven in 10 U.S. consumers said they are willing to spend about 13 percent more with businesses they believe provide excellent customer service, according to a survey last month by American Express. Some are willing to spend up to 22 percent more.

Three in five also said they would try a new brand or company for a better service experience.

The good news for small businesses? Four out of five said they felt that smaller companies place a greater emphasis on customer service than large businesses.

The trouble is, many consumers believe that businesses overall aren’t focusing enough on customer service. Six in 10 said they believe businesses aren’t focused on offering good customer service, and 22 percent said that they felt companies took their business for granted.

And that can be costly. Nearly 80 percent said that they let their money do the talking — because of poor service, they opted not to go through with a transaction or sale. Plus, they were more likely to rant to their friends about their bad experience than if they had a good one.

A separate report in 2009 by Genesys found that ultimately the cost of bad customer service to businesses worldwide is $338.5 billion. Genesys, which develops customer service software, also calculated that it cost $243 on average for each customer that a business loses because of poor service. Consumers end on average 1.4 business relationships each year because of bad customer service experiences.

Not surprisingly, nearly two-thirds  of angry consumers turn to a competitor. The rest just decide not to purchase from anyone.

What can small businesses learn from these numbers? Be cognizant of the biggest complaints that consumers have: being trapped in an automated self-service queue, waiting too long for service, having to repeat themselves, and dealing with someone who can’t answer their questions or doesn’t have the skills to help effectively.

And be aware of how to make them happy: Convenience, personalization, and dealing with competent staff. Plus, be proactive. 86 percent said they would welcome assistance if they were stuck on the web or in self-service and someone gave them a call and offered help.

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