Why Excellent Customer Service

Why Excellent Customer Service is Crucial to Improving Sales ...

We spend a lot of time talking about the positive effects of customer service (customer service). We’re experts on it. But how does customer service help boost your sales, and what happens if your customer service isn’t as great as it should be?


How does customer service affect sales?


Happy customers buy more. Retaining loyal customers leads to repeat purchases and keeping your customer satisfaction high is great for getting referrals.

The better your customer service, the more likely that your customers’ price sensitivity will drop. Satisfied customers – who feel like they are valued by the company – are generally much more willing to spend more than new customers.




Not only are existing customers more likely to spend more, they’re also easier to upsell to – 10 times easier actually. If you’re about to launch a new product, or you want to increase sales for a certain item, your loyal customers are one of your best options.

Customers who have consistently received good customer service, along with good products, are more likely to be loyal to your brand. 

Because of how high their satisfaction is, they’re much more open to trying new products. Remember that their price sensitivity is also lower! Not only are they more willing to try a new product, they’re probably going to pay the most for it. Provide excellent customer service and half the work of your advertising is done for you.


Higher Lifetime Value


This all leads to a much higher lifetime value (LTV) for your customers. Happy customers can have an LTV six times higher than regular customers.

And LTV is important. If a customer’s value is higher, they’re more profitable for your company and much more important to keep.

These customers can be five times as likely to buy from you again and are four times as likely to refer your company to another potential customer. So it isn’t only important to make sure your customer service is top notch, but also to make sure that it stays that way. Retain those happy customers!



Acquisition vs Retention – Why customer acquisition is important too 


How customer acquisition and retention can affect your sales


The difference between acquisition and retention can be vast. Not only in cost, but in growth. Retained and loyal customers can help increase your incremental growth by up to 20% a year. And that’s nothing to be sniffed at. Without customers, any business would be redundant. It’s important to appreciate the customers who are loyal to you and consider their needs. 

 If you get your customer service and your customer experience right, they’ll reward you through purchases and free endorsement. In fact, 89% of companies consider customer experience to be important to retaining customers. This kind of gradual growth is vital to any business. It’s the bedrock that keeps you grounded (grounded; get it?).

However, acquiring new customers is important for rapid growth. Although it is far more expensive to your company, it can often be worth it. New customers can be up to 2.8 times more important for rapid revenue growth than retained customers. If retained customers can increase your growth by 20%, consider what acquired customers can do for your company.


So what does that have to do with customer service? We’ve talked about how referrals are a good way of gaining new customers, but your fantastic customer service shouldn’t just stop there.Customer service can no longer just be an aftercare thought. If potential customers are browsing your website, this is when your customer service can change that lead into a conversion.


On-site advisors and webchat features are always helpful in pushing customers toward a sale. If a customer is finding your website difficult to navigate, or they can’t find the item they want, 78% of them may simply abandon their cart if the customer service isn’t good enough to help them.

But with excellent customer service, you can avoid this. Your operators should be there to lend a hand when it’s needed; they should be actively looking for people that they can help on your website.

Train your operators well and make sure they’re where they need to be to help turn potential customers into acquired ones. Otherwise, the meagre customer service you’re providing can affect your sales in more ways than abandoned carts.


What happens if your customer service is poor? –
Unhappy customers cost you money


If a customer has received a faulty item or is confused by a service you provide, helping them the first time should be a priority. First contact resolution (FCR) can save you money in the long-run.

Of course, your operators need to be well trained, have the right temperament, and be experts in the product or service in question. Without them doing a fantastic job on your frontline, those unhappy customers can become a nightmare.

One of the most famous examples is that of David Carroll and United Airlines. After United’s employees broke David’s guitar, the airline refused to admit its mistake or pay for the damage. This shameful customer service lead to David writing a song about United – using his broken guitar as a prop – which eventually cost the company $180 million. You can still find the song online!



Another great example is the confrontation that took place between Ocean Marketing employee, Paul Christoforo, and a disgruntled customer of N-Control, a gaming controller manufacturer.