Customer Service?

Thursday, August 13, 2009

Customer Service?

As I was going through my saved emails, I found these words of wisdom from Harvey from a couple weeks ago:

Taking care of customers is taking care of business

"Customer service in America stinks."

That's what my friend Tom Peters, author of the blockbuster book, "In Search of Excellence," said many years ago. It must still be true because every time I write about poor customer service, I get more Amens than a Billy Graham sermon. That's why I want to touch on customer service again, from a different perspective.

It's unbelievable to me how business owners remain ignorant of the devastating effects of lousy service. And they wonder why business is suffering and the cash register isn't ringing?

The Research Institute of America conducted a study for the White House Office of Consumer Affairs, which found:

Only 4 percent of unhappy customers bother to complain. For every complaint we hear, 24 others go uncommunicated to the company—but not to other potential customers.
90 percent who are dissatisfied with the service they receive will not come back or buy again.
To make matters worse, each of those unhappy customers will tell his or her story to at least nine other people.
Of the customers who register a complaint, between 54 percent and 70 percent will do business again with the organization if their complaint is resolved. That figure goes up to 95 percent if the customer feels that the complaint was resolved quickly.
68 percent of customers who quit doing business with an organization do so because of company indifference. It takes 12 positive incidents to make up for one negative incident in the eyes of customers.

When I started out in sales, a salty old veteran told me, "Harvey, never make promises in business. They'll ruin you every time."

That might be good advice, but only up to a point. That point is reached when you go to contract because in a contract, you make commitments, which are the same as promises. You vouch for planned delivery dates, not random drop-off times. These are not tossed-off verbal guarantees but well-researched commitments.

Nothing is more important than customer service. No customer service, and pretty soon, no customers.

The key is to latch onto your customers and hold them fast. Don't just meet their needs. Anticipate them. Don't wait for them to tell you there's a problem. Go out and ask them if there's a problem. They are your most important focus group. Every word of personal feedback they give you is worth a million faceless questionnaires.

With business operating at digital speed, the margin for negligence is disappearing. Broken promises, missed deadlines, inadequate customer service and support—give in to any of these and you're finished.

And as customers become more knowledgeable, customer service becomes more difficult. A while back there was a series of articles in Fortune magazine focusing on customer satisfaction and why Americans are so hard to please.

A researcher at J. D. Powers & Associates, a company that studies customer satisfaction in the auto industry, computers, airlines and long-distance service, stated: "What makes customer satisfaction so difficult to achieve is that you constantly raise the bar and extend the finish line. You never stop. As your customers get better treatment, they demand better treatment."

When I speak on customer service I usually tell a story that I read many years ago in USA Today. A man walked into a bank in Spokane, Wash., to cash a $100 check. The bank teller refused to validate his parking ticket, saying he had to make a deposit. The customer asked to see a manager, who also refused to stamp the parking ticket. At that point the customer proceeded to withdraw $1 million from his account and walked across the street to a competitor and opened a new account. The next day, he went back to the same bank teller and withdrew another $1 million.

That's an expensive lesson to learn. So is losing any customer.

Mackay's Moral: Disappoint customers and they'll disappear.