What to Spend on Customer Service & Other Questions

Helpful Q&As about customer service.

By Marcia Smith

1. How important is customer service training?

Customer service training is essential for any employee who has interaction with customers. Employees who show professional service skills can improve customer loyalty and gratification. This can shorten the amount of time spent with the customer, which in turn will heighten the efficiency of your business.

Good training involves teaching a common language and process that every employee can follow, creating better consistency in service and upping the amount of ‘first contact’ resolution. This strengthens relationships within the company and allows less room for error. Excellence of service will then be associated with your brand and add to the value of your business.

2. How important are magic moments in retaining customers?

The best customer service is focused on satisfying the needs of customers immediately, and the ‘magic’ moments – where customers feel they’re remembered and treated like individuals – can really make a difference.

The value of such moments should be regarded highly. Over and above providing a product or service, the enhanced service these moments provide can make the difference between customers choosing one provider over another. You can see this difference by looking at the number of people who select a provider on the basis of recommendations from friends who have enjoyed the magic or the high level of personal service provided. All these people keep going back to the same company as long as it provides them with those special, magic moments.

3. How important are CRM Systems in retaining customers?

An often forgotten part of businesses, an integrated CRM (customer relationship management) programme is an easy way to reduce costs and streamline operations.

It costs less to keep a client than it does to win new a new one, so it pays to uncover the hidden story of what’s driving your sales. For instance, if your CRM system shows that many of your customers are from Germany, it makes sense to have localised web content or to invest in language training – visibility is key.

CRM systems can automate analytics, flagging gaps in your segment (and your strategy) as well as running regulatory checks on higher risk clients. Be aware, though, these systems can get incredibly expensive, so make sure that you have the capacity to use them to their full potential.

4. How much of my budget should I spend on customer service?

Business experts recommend that most companies should actually spend something in the region of 75% of their marketing budget on maintaining and keeping a good customer service profile. This is so that they can:

Retain their client base.
Re-engage them continually.

Surprisingly enough, this is a tactic that few large corporations make use of, as they prefer to try and constantly engage new clients, or chase after the ones who have perhaps left and gone elsewhere. Looking after existing clients with excellent customer service that is well thought out and professional can often mean more repeat business in the long term, and potentially more word-of-mouth business expansion.