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@ what price??

November 1, 2011

                                                                   

What is the price to pay when your company promotes bad customer service. You lose current customers, potential customers, and customer respect?  On top of that you will lose the 2 most important aspects of a company; competitive advantage and your company’s good reputation.  Jan Ferri-Reed wrote in the Journal for Quality and participation an article entitled Driving Customer Service excellence. Within this article she goes into details about ways to bring customer service excellence into the work place. Here are some of her ideas.

She states that “the average unhappy customer will tell 8 to 16 of people” about their problems with your company. This is probably increased since then. People don’t talk and praise a company about the good things they do, they only critique the bad. With social media on the rise, there are plenty of ways for angry customers to share their experience with the world, including Yelp, Facebook, and twitter just to name a few.

She also shares how “90% of unhappy customers will never purchase from you again”. This is absolutely the truth. How many times have you been so angry with a business that not only you tell everyone you know not to shop there, but you yourself have never stepped foot into that place again?An overwhelming amount of people will have one bad experience and never return to that company. This is due to the large number of substitute products we have. Within most industries the amount of rivalries are enormous, not to mention barriers to enter into that industry are low. Keeping the customers you have happy is the most valuable tool to create a sustainable competitive advantage.

Jan shares says “it costs 5 times as much to attract new customers, then it does to keep one.” I myself overwhelming agree with this statement.  The amount of effort, time, and money you must put forward to bring in new customers is insanely high. Why waste all your time trying to convince people to use your service when you could be convincing people who are already sold to stay.

Convincing a person to buy a puppy isextremely hard they have to put time effort and money into the animal and that is stressful; convincing a person to keep the puppy after they have named it, played with it, and built a relationship with it is a whole lot easier.

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