What is Customer Service? How does it matter in every business?
Customers are the core of every business. Excellent customer service should be a goal for all business owners and managers. Delivering excellent customer service is critical to retain customers, then ensure business growth. Customer support is not merely answering customer inquiries. It is making the brand promise come true.
If, in the past, people might primarily choose a company based on the price and quality of products; these days, they make decisions because of the overall experience.
Every business should invest in enhancing customer service to provide consistently excellent customer experience.
Table of contents
- What is customer service?
- 6 types of customer service
- What is excellent customer service?
- Impact of excellent customer service in a business
- Tips for boosting your customer service standards
What is Customer Service?
Customer service can be defined as the way a business takes care of its customers. More specifically, customer service is providing support before, during, and after customers make a purchase.
The support that a customer seeking can be information, assistance or a trusting environment. Delivering great customer service means that you are creating happy and enjoyable experiences for your customers.
Customer service is not simply answering customer questions or fixing a broken product. From a practical perspective, customer service is fulfilling your customers’ needs and solving their problems.
From an emotional one, customer service means caring for customers and treating them with respect.
These days, in a corporation, customer service is not just the responsibility of any staff who interact with customers directly; it has to be a team effort. Customer service training should be applied to every department in an organization. This training can help even non-customer-facing staff understand the typical customer’s needs and behaviors.
6 Types of customer service
For years, technology has brought many new communication channels. Therefore, a business has many ways to interact with its customers. Determining what types of customer service to offer depends on the business’ needs and customers’ demands.
In this post, we would like to take a look at the most popular types of customer service.
Telecommunication support or phone support can be considered as the oldest type of customer service. However, phone conversation remains a powerful way to handle customer inquiries. According to Microsoft’s report, this type of customer support is still the most popular option among all service types all over the world.
When customers get help via phone calls, they can present their problems fasters. Also, agents can assess customers’ emotions as well as explain and elaborate complex issues better. Phone support is often preferred by older generations who are more familiar with a telephone than other devices.
Not only answering a phone call to resolve customer problems, but phone support is also one of the most common ways to collect customer feedback.
To provide telecommunication support, a company can set up a team or outsource it to a call center agency. The ones who handle phone calls should be well-trained about company products and services as well as excellent oral communication skills.
Email is well-known as a reliable communication platform. Email seems a bit old-fashioned, but it is still a feasible way of delivering customer service. According to the Radicati Group report, the number of email users has reached more than 3.2 billion. Every day, people send more than 269 billion emails.
Email support allows customers to send their queries at any time of the day or night. As they have time to write down every matter, then they can explain complex issues better.
By responding via email, your support team can include links, attach files to provide specific information for customers. Furthermore, the conversations are kept at both sides for future reference.
Several B2B companies choose email as the first form of support because the nature of their customer service is not urgent.
When providing customer support via email, responding on time is crucial. Customers are not patient enough to wait for days for a response. It is advisable to answer customer emails within 24 hours since their initial contact.
Live chat support
A live chat service system offers a real-time communication channel for customers who are looking for instant support. You can see this type of customer service on the right bottom corner of many company websites.
Besides websites, live chat agents can connect with customers via various messaging apps like Facebook Messenger, Twitter, LINE, etc.
The speed is the outstanding feature of live chat support. Live chat allows agents to hold multiple conversations at the same time, which leads to faster responses. Also, repetitive questions can be handled automatically by chatbots.
Live chat is a must-have tool for online business. When your customers and prospects can get instant responses, they are satisfied. For existing customers, they will continue to use your products or service. For potential customers, they are more likely to buy your products.
According to LiveChat’s 2019 Customer Service Report, more than 82% of customers are satisfied when they are supported via live chat.
To ensure your live chat system to work well, your live chat agents must have excellent written skills and ability to handle multiple inquiries during peak hours. And when chat isn’t available, you have to provide customers with notification and alternative channels to get information.
Social Media Support
Nowadays, almost everyone has some social media accounts. Many companies take advantage of social media platforms to reach their customers. Facebook, Twitter, and Instagram are the most popular social platforms to provide support to customers.
Using social media support, you can engage with your customers in various ways, including private chats, public comments, and group discussions.
When questions are open to the public, responses can be viewed by more people. As a result, the number of similar questions can be decreased.
Like all other types of customer service, the success of social media support depends on the quality of care provided. You should have a staff or a team to control your company’s social accounts to make sure your customers’ concerns are promptly addressed. Your agents should have the ability to handle complaints as well.
All of the above types of customer service require companies to build customer support teams. Customer self-service is different as it is entirely unlinked from customer support representatives. This type of customer service lets customers find the answers or solutions by themselves.
Customer self-service works excellent for people who prefer spending their time researching for the solution on their own than going on a live chat with a customer support agent.
These people might be a bit introverted and want to limit their connection with others, or they may already have the fundamental knowledge.
To apply customer self-service, companies have to build a collective knowledge base. This can include demos, tutorials, webinars, user guides, etc. To guarantee customers can access correct information quickly, you have to keep the information up to date.
Self-service can be considered as a modern type of customer service. A great self-service with a well-organized knowledge base can both boost customer satisfaction and reduce support costs.
According to the experts at Gartner, setting up self-service can reduce support costs by up to 25%.
Learn to optimize your FAQ page here.
Multichannel as the ultimate customer service
As we can see, there are various types of customer service. Each of them has distinct benefits, but they work best in combination. An effective customer support system typically offers multiple channels so customers can reach out on their preferred channel.
A study conducted by Dimensional Research indicates that 28% of customers consider multiple communication options as good customer experience, and 27% think that they are experiencing bad customer service if they cannot contact the business via their preferred channel.
Moreover, 85% will try a different contact method if they don’t receive a response from their initial inquiry, and 51% wait less than an hour before contacting via another way.
What is excellent customer service?
To deliver great customer service, you have to identify the essentials required to accomplish it. There are six key ingredients to establish excellent customer support.
Reliability is the key to any good relationship, and good customer service is no exception. Customers always expect service providers to be accurate and reliable during interactions.
If you are a customer service agent, then you should always think before you give any promise and keep them carefully.
Competence measures knowledge and skill level about products or services. To provide good customer service, you have to know not only your products but also others available in the marketplace.
Make sure everyone in your organization has in-depth knowledge of your products or services. Build a list of most frequently asked questions and prepare the most appropriate answers to them.
One of the most prominent elements in good customer service is speed. How long do your customers have to wait to receive support? When they reach out, how long before their issues are addressed, and some solutions are provided? There is nothing worse than no response to a customer who is trying to get help or finding more information.
It is essential to answer customers as soon as possible. Even if you are looking into the issue, or researching a solution; you have to inform them about the situation.
Courtesy means being kind and polite. All customers deserve being treated with respect.
You have to listen to your customers attentively and show them you are doing that by making the appropriate responses and suggesting how to solve the problem.
Always be friendly, professional, courteous, and respectful when dealing with customers.
Credibility is a measure of how a business performance matches its advertisement, how an organization delivers its promises. A company must be trustworthy and ethical.
Credibility has to be built by everyone in the firm, especially the customer service department, who contact customers directly. Even a small mistake by an individual can put a whole organization’s credibility into questions.
To protect your organization’s reputation, you have to insist that everyone is appropriately performing their duties.
Consistency means providing a consistent pattern of behavior. Consistency makes existing customers loyal to your company and convinces potential customers to choose your products and services. Consistently being reliable, competent, responsive, courteous, and credible means that you are probably providing many excellent customer experiences.
Impact of excellent customer service in a business
According to a survey by American Express, a customer who is happy with your business will talk about it to nine friends – which is like getting nine referrals.
On the other hand, an unhappy customer will discuss his experience with sixteen friends. That means sixteen people who are less likely to try your product.
Customer service is all about keeping your customers. Happy customers lead to more value, growth, and sustainability.
Increases customer retention
The majority of consumers consider good customer service as a reason to stick with a business. To be exact, 75% of people would return to companies that provide excellent customer service.
These days, many companies offer the same products or services. Beyond product satisfaction or value, customer satisfaction reigns supreme in today’s landscape. Customers have plenty of choices out there in the marketplace.
Why should they be loyal to you? Your effort in marketing may appeal to customers at first, but your great customer service will keep them.
It is calculated that the cost of attracting a new customer is approximately six or seven times higher than the cost of retaining an existing customer.
Furthermore, the probability of selling to a new customer is only about 5 to 20%, whereas selling to an existing customer is about 60 to 70%. Only a 5% increase in customer retention can contribute to an increase in profit of 25%.
Improves brand reputation
If you want to strengthen your brand reputation, you definitely have to offer consistently high-quality customer service. Perfect customer service leads to positive customer experiences. When customers enjoy the service, they are likely to recommend the brand to their friends and relatives.
In fact, 77% of customers have shared positive brand experiences with others. Your customers obviously are the best and cheapest in the form of word of mouth advertising. Also, about 55% of consumers make their purchase decisions because of the brand reputation for great customer service.
So it is vital to ensure that your customer service team has represented your brand characteristics. Your team has to help influence customers and convince them of your strengths over other competitors.
Increases customer lifetime value
Customer lifetime value (CLV) is a metric that measures the total revenue expected from a single customer throughout their engagement. Increasing this value means that your customers are shopping more frequently or spending more money on your products or service.
Offering excellent customer service is an excellent way to grow customer lifetime value. Research has proven that highly engaged customers spend more money.
More details, these customers purchase 90% more frequently, pay 60% more per transaction, and contribute three times to annual value than others. And it is evident that better customer service results in higher customer engagement.
If customers have a memorable experience with your support teams, they will not only shop again but also share their vast knowledge with others, which builds rapport with your customer base.
This makes new customers trust in your business and allows you to upsell and cross-sell additional products easier.
Reduces employee turnover
Delivering great customer support is good for both your customers and your employees. Satisfied and delighted customers help create a positive working environment.
When people work for an organization that provides excellent customer service, they will be proud to be part of the team and more engaged in their work. They would be more willing to stick with the business.
Ensures business sustainability
About 96% of small businesses close within ten years. A significant problem is poor customer service. Customers quickly get frustrated if their issues are not addressed or slowly resolved.
When a company ignores the needs of its customers and delivers insufficient support, it is cutting short its longevity in business.
Offering excellent customer service can build your business with a competitive advantage. It helps differentiate your brand from other competitors. It is reported that 60% of customers stop doing business with a brand after one poor service experience.
And, 67% of this churn can be effectively prevented if the customers’ problems are resolved during their first interaction. Customer service is the key to keeping customers loyal and getting them to interact with your brand continuously.
It is undeniable that a company can only be the best version of itself if it has a well-trained, positive customer service team. Their ability to communicate directly with customers can revolutionize your company and grow your customer base.
Tips for boosting your customer service standards
According to research by Walker, by 2020, customers will value experiences more than prices and products, and 86% of shoppers will spend more for better customer service. It is essential to build, implement, and enhance your customer service standards.
Customer service standards refer to a set of company policies, obligations, rules, and guidelines that have been created and adopted by a company.
Customer service standards cover all the points of interaction between a business and its customers. These standards are essential to define customer expectations.
Investing in formalizing customer service standards is an important practice for companies to undertake.
Integrate customer data to create a unified view
In the digital age, establishing an effective coordination system among different departments is vital as disconnected data often leads to customer dissatisfaction.
Businesses should integrate their customer data by using smart CRM platforms to handle the disconnected data issue. Such systems create a unified view for everyone - which is vital in implementing high customer service standards.
Deliver multi-channel customer service
Today, consumers prefer brands that offer customer service across multiple channels. Therefore, brands need to provide customers with omnichannel communication to enable them to switch between their preferred channels and enjoy a consistent quality of service.
It is essential to ensure that information between multiple channels has to be connected.
For example, if a customer sends you a message via live chat one day, then emails you the next day, the agents in charge must have an accessible record of a previous interaction. It is vital to provide the same standard across every touchpoint.
Strengthen Your Customer Service Team
Enhancing your customer service quality begins with building a strong customer service team. To achieve the agents’ full potential, they have to be empowered with three things: right training, right tools, and decision-making power.
You should hire and train your customer service staff with the right skills, including:
Empathy and Patience
Good Communication skills
It is also essential to track the performance of your customer service representative via ratings and reviews from customers.
Applying AI also makes agents work more effectively and efficiently. For instance, auto chatbots can handle repetitive questions then free up agents to work on more complex tasks. Systems support auto-prioritize to accelerate case resolution.
You should also recognize and reward the efforts of your customer service teams to motivate them to work proactively instead of reactively.
Customer service can be considered as the backbone of your business. Without the spine, the company is not likely to stand straight and get taller.
Customer service plays a significant role in your business. It is not only a contributor to customer loyalty but also the key differentiator to make the company outstanding in this competitive marketplace.
So, begin to implement various types of customer service we have discussed and use tips provided to enhance your customer experience.