Poor customer service is almost always a result of poor strategy and the belief in the paradigm that the customer service center is a cost center. Since Common Wisdom says cost centers must have costs driven down, you did just that. Now the part of your business that has a direct impact on customers is understaffed, underfunded, and under water. The pay is too low to hire good agents and the budget too small to allow for training and technology to streamline the work processes.
This results in poorly trained agents who are dealing with a system that holds them back from providing the customer with what he wants. That customer may already be mad when he calls the service center. Imagine how he will feel after he hangs up! I think you can take that customer off your list; he’s had enough and he’s gone.
Research shows that up to 30% of customers or more have a bad customer service experience. Of the customers who have had a bad experience, only about 2% will actually complain. The other 98% remain silent. However, all 100% are likely to leave. You may never know of a problem until it is way too late and a third of your customers is gone.
Another result of this cost-busting customer service approach is negative word of mouth (WOM) about your business. And a study has shown that negative WOM is disseminated twice as much as positive WOM. The internet makes the reach even greater and faster. On top of that, hidden costs show up in the service center as call volume increases due to the failure to resolve problems on the first call. In addition, marketing and sales become more costly because it is expensive to convince an unhappy customer (or someone who has heard bad things about your business) to buy from you.
Congratulations. Now the customer service center really is a cost center. But all is not lost, Padawan. You can turn things around.
And tomorrow, I will tell you how. You won’t even need The Force.
Citation: “The Economic Necessity of Customer Service” by Natalie Petouhoff, PhD, et al. Forrester Research, January 21, 2009.