Many customer service personnel don’t realize, or have forgotten, how critical it is to provide outstanding service. It’s a tough job, after all. Imagine how you’d feel if you spent your days and weeks dealing with endless problems, and frustrated, angry people. Beyond that, business owners often don’t take the time they should to impress upon their staff the real cost of losing a customer.

You can easily find the approximate value of each customer. The simplest method is to look through your sales for a week and determine what the average purchase amount is. Then, if you track individual customer purchasing habits, see how often over a month’s time your average customer buys from you.

If you find, for example, that your average profit per sale is $30 and a typical customer returns twice a month, that’s $60 profit a month on average. Or, $720 a year. How about $3,600 over five years? You wouldn’t want to throw away $3,600. Yet if you “burn” a customer who has encountered a problem, you may be doing exactly that.

Customer service can make or break you

Recently I’ve experienced both good and bad examples of customer service.
One was an online purchase of a $20 item that was part of a larger order. That particular item was defective. I described the problem by email, and the owner asked me to send it back and said he’d replace it. “Fair enough” I thought.

When he sent the replacement, I was surprised to find he had enclosed two of that item. Enclosed was just a short handwritten note that said “Sorry for the inconvenience” and the owner’s signature.

He’s busy. He wears several hats in his operation. But he took the time to not only do it right, but to even go beyond what was expected. That made a big impression on me, since so few really go “above and beyond.” I now check his store regularly to see what other items I might like to buy. I know I can trust him.

On the negative side, I made a purchase at another store (again online) and my credit card was over-billed. When I notified the company, I was asked to provide proof of where I had seen the correct price! I found it, and sent a detailed description on how to navigate there (that web page did not have it’s own url). This took more time, naturally. After that, I didn’t hear anything for two months, so I sent another inquiry repeating all the details.

This time the same representative replied with a terse note: “I’ll need your credit card number to credit your account.” That’s it. No apology. No explanation for not replying for two months. Needless to say, I feel no affection for that company. To top it off, they are heavily dependent on repeat sales, since they sell “consumables.” I was amazed by their attitude, because I was spending roughly $125 every two months with them. So, they threw away $750 a year. Doesn’t make sense, does it?

Learn how well you’re doing
How can you tell if your customers are getting proper service? One way is to shop your own store. That is, have others shop at your store and report their experiences back to you. Typically, you would give them a spending limit, and reimburse them for their purchases. They get to choose something they like; you get valuable information. You can also have someone call your store for information and see if the results meet your standards.

If your phone system allows you to monitor customer service calls, you should spend an hour a week doing so. It is critical that your company’s representatives are handling your customers—that is, your present and future income—with proper care.

Help is available if you’d like to hire shoppers to gather intelligence about what it’s like to shop at your place of business. You can visit this site and get a good idea of how it works: www.funjobsreview.com/shopping.htm.

Before you implement a program like this, however, make sure your staff fully understands not only your policies, but your personal customer service philosophy as well. They will often learn the “finer points” directly from you—nuances not covered in your policy manual.
After you’ve gone to the expense of bringing customers to your place of business, it makes sense to keep them satisfied. Yes, providing top-level customer service can be expensive, but not providing it is far more costly.

Michael Cooney, co-founder, Global Development, a marketing and advertising consulting group
818-522-1970 www.GlobalBrand.com