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It’s five times cheaper to keep a client than to get a new one.  ~ U.S. Office of Consumer Affairs

Many statistics and studies exist that prove great service pays for those businesses who place a priority on delivering great service.  Intuitively most people know good service is good business.  Did you ever stop to really think about why some of these statistics are true, however? 

For example when it comes to the statistic about it being cheaper to keep a client than get a new client, why would it be five times cheaper to keep a client than get a new one?  Here are some thoughts.  See which ideas pertain to you and your company: 

• There are often a lot of up-front costs with attracting new clients:  marketing, time, sales, advertising, paperwork.
• Discounts are often given to new clients to attract them. 
• New clients tend to need more hand-holding.  They don't understand the product and/or service and ask more questions. 
• New clients tend to make mistakes.  Mistakes that can cost the relationship and/or money to fix. Read more »

Have you noticed that computer passcodes are getting longer and more complex lately?  Capital- and lower-case letters, numbers, and even symbols are a frequent requirement now.  I understand that it's done in an effort to ensure privacy and protect individuals from identity theft, but honestly, the complexity of the passwords are making it so it's difficult for me to remember who I am.  In addition, I probably have 20 - 30 sites I need passcodes for, making it nearly impossible for me to remember them.

From a customer service perspective, this can be a nightmare, because when clients have difficulty accessing accounts, a layer of annoyance is added to the transaction, making their first experience an unpleasant one.  Although I do not have experience with privacy and security, may I suggest that there may be a few things that can be done from a client experience perspective, however, to help mitigate a clients' poor experience. 

• Tell me upfront if you will require my user name to be my e-mail address.  It will save us both a step in having to enter information twice. Read more »

Today, nearly every business is commoditized:  stores, airlines, financial services, car companies, wireless service, hotels, restaurants.  Even professionals are commoditized:  accountants, realtors, trainers, builders, and the list goes on.   Don't believe me?  If your clients can't get the product or service from you, how hard is it to find a very similar product or service elsewhere?  

A commoditized product or service coupled with low client loyalty is dangerous, as the impact can immediately be felt when and if issues occur.  To exemplify, look at what happened this past month at Toyota.  When quality issues at Toyota surfaced, sales at Ford and other Toyota competitors immediately increased.  Whether or not Toyota's competition will be able to sustain that growth remains to be seen, however.  Because if there is no plan in place to differentiate themselves, Toyota's competition will also lose business when their situation changes. 

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This article is written by my friend and colleague Peter Sluka

Very often when service issues exist, the cause of the problem is complicated.  The fact is, the cause may be due to the employees, training, measurements, lack of service standards, objectives, or many other factors.  If you have already embarked on your Service Journey you are no doubt beginning to see real, tangible benefits. Maybe you noticed an employee going the extra mile to win the lasting loyalty of a customer. Maybe you feel that heightened energy level in your call center. And maybe you have even noticed improved retention, attrition, conversion rates and repeat business. You’re on your way! Read more »

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Today, in the United States, we celebrate the love we feel for someone special to whom we are loyal and advocate.  Likewise, in order to grow a business that is truly profitable, we need to create clients who are not only loyal, but advocate on our behalf.  Did you know in the typical business, the majority of clients doing business with someone really don't care about that individual, business, or firm one way or the other?  

According to Reicheld's The Ultimate Question:

• The average firm has net promoter score  (where the percentage of promoters outweighs the detractors) of only 5 - 10%. Read more »

Have you ever had a really poor experience at a restaurant, store or business that made you stop going there?  Probably all of us have.  Furthermore, there are probably places you used to frequent often, where you've cut back.  I know for me personnally, after many years shopping at the local grocery store, I started food shopping at a store much further away.  I still may shop at my local grocery store for odds and ends, but the bulk of my food shopping is done elsewhere.  How many businesses would provide better client service and train, hire more customer-oriented employees, or emphasize the importance of a better client experience, if the true worth of each client was calculated?  

For I find it is often the case that many businesses never calculate the true value of their clients when making business decisions.  Here is a way to do it:

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"Sure we can give our clients everything they want, but then we will go out of business."  This is something I often hear when helping firms implement a culture of excellent service.  Sometimes, if I don't hear it, I can sense the concern.  Perhaps this may even be a concern of yours.  

If great service was delivered to the detriment of the shareholders however, and money was spent on service without a return on investment, no one would come out ahead, as the firm would not be optimizing profits, would not be competitive, and would not be able to stay in business for the long term.  Similarly, if great service was delivered at the expense of the employees, and the employees were treated poorly, ultimately the clients and shareholders would lose out, because there would be high turnover, clients would not be treated ideally by the employees who were left behind, and revenue would decline.  

Ultimately, in order to maintain and sustain a culture of excellent service, the desires of the clients, employees and shareholders need to be balanced.  Investments in excellent service need to be carefully weighed in order to ensure the highest return for the investment.  A cost-effective ongoing all-encompassing program needs to be implemented.  And Read more »

If you go on a long trip with young children (and sometimes not so young!), they will inevitably ask when you're going to arrive at your destination.  Mine used to ask that age old question seemingly a thousand times, "Are we there yet?"

When we are on a journey to deliver excellent service, we can never ask if we are there, though.  Because there will never be a time when we can say 'we've arrived'.  As our service improves, our clients will become increasingly demanding, our competitors will begin to adapt your best-practices, and when not constantly reinforced, our employees' behavior will begin to wane. 

Thank goodness journeys with our children result in us eventually getting there; unfortunately, with our service journey, we never reach our destination. Read more »