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Fight Customer Churn With High-Quality Customer Service

ByAri Rabban,
business.com writer
|
Mar 01, 2017
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> Marketing
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If you’re writing off customer churn as a reality of doing business, you’re doing it wrong

If you’re writing off customer churn, also known as customer attrition, as a reality of doing business, you’re doing it wrong. Not only are new customers more expensive, but they’re also less valuable in the long run than the customers you already have. In fact, acquiring new customers can cost up to five times more than retaining your current ones.

Long-term customers, on the other hand, are more valuable by far. For one, they’re your best salespeople — they refer new clients, serve as ambassadors and offer testimonials for your business. They’re also the most engaged, and they can help you improve your products or services by participating in surveys or beta testing, even recommending what you may want to add to your current offering.

Not only that, but a recent study by Bain & Company found that customers tend to spend 67 percent more after they reach their second year with a company than they do within the first six months.

Holding on to loyal customers instead of taking them for granted — and slowing churn — can lower marketing costs and increase your profit per customer. This means placing more resources and attention on the one department they interact with the most: customer service.

Combating Churn at the Source

These days, companies know more about their customers than ever before. Through purchase histories, comments on forums or even behavior on social media, the sheer amount of data is astronomical. So if you know so much about your customers and their needs, why do they leave?

They leave because when issues occur, they feel like they aren’t being heard — that your company doesn’t care about them or their needs.

Most of the contact between your business and your customers will be handled by your customer service team, yet only 8 percent of customers believe customer service is on par with their expectations. When someone is confused about a feature or has a complaint, the ability to talk to an experienced, friendly customer service representative is key to ensuring he or she sticks around.

Two years ago, my team had a period of several weeks when we suffered from cyberattacks on our network that disrupted phone service. We weren’t the only company in the industry to experience this, and we had customers reaching out through multiple avenues to find out what was going on.

Our response was to take an “all-hands-on-deck” approach, meaning everyone from employee to executive was available by phone, email, and social media to connect with concerned customers. We did lose a few customers as a result of the outage, but many more stayed on because they appreciated the honest, direct communications. A potentially disastrous loss was averted due to our commitment to the right kind of customer service.

Insightful Communication Is Crucial

 

When a customer knows that the business truly cares, he or she is more willing to accept inevitable shortcomings, such as an occasional malfunction or product defect.

Connecting to your customers is especially important during the rough patches. They can tell when they’re getting bad service or when the responses they receive are canned or insincere. How easy do you make it for them to reach you? How quickly can they speak with someone who truly understands the issue?

Following up with customers is equally important — whether they’ve reached out to you or not. Ensure they’re satisfied before they even ask a question. This demonstrates an investment in their well-being that goes a long way and helps them keep you in high regard if they ever become unsatisfied.

Making the Most of Customer Contact

It’s time to give your customer service team the attention it deserves. Take these steps into account:  

1. Cut the catchphrases. Traditionally, customer service reps are given massive books full of the exact phrasing to use in any given situation. The trouble is that irate customers can smell this tactic a mile away. Nobody wants to be repeatedly told: “Please hold. Your call is important to us.”

Eliminate the catchphrases that are now primarily associated with bad customer service. Especially avoid these overused phrases with actual nonrobotic service reps. No customer is going to be soothed when, instead of a solution, he or she gets a canned “that’s our company policy.” Customers don’t want to hear something that came from a script; they want someone who can speak to them frankly and easily.

2. Beef up the training. Tutorials and response books only go so far. The most obvious thing you can do to improve the quality of service is spend more time training your employees. With more hands-on experience with the products they’re asked to discuss, team members will have an easier time leaving the scripts behind and offering personalized assistance to every customer who calls in.

3. Empower service reps to make decisions. Your team members will be better equipped to talk to customers if they have the power to solve problems on their own. Transferring an irate caller from one department to another or saying that a representative isn’t authorized to do what the caller needs is a quick way to lose a winnable customer.

Empowering your first responders goes a long way toward solving problems quickly and easily. And when customers don’t have to call back multiple times to get the answers they need, it can save you time, money, and reputation.

4. Learn from the customers who leave. You’ll never get a better chance to find the problems with your service than from the customers who walk out the door. Thus, it’s important for your customer service center to glean as much information from former customers as possible about the source of their dissatisfaction. Whether it’s your service, product, price or some other area of discontent, making a necessary adjustment can help prevent customer defection in the future.

Don’t let time or budget be an excuse for letting your business lose focus on the customer experience. Work on improving your interactions, and learn from your mistakes. Ultimately, you can overcome churn and create new customers while improving your investment in your existing ones.

Image from Rawpixel.com/Shutterstock

Ari Rabban
Ari Rabban
See Ari Rabban's Profile
Ari Rabban is the CEO of Phone.com and a veteran of the IP communications industry. Phone.com’s virtual phone service builds on the digital VoIP industry experience of its founders to deliver a complete suite of enterprise-grade unified communication services at an SMB price. Ari was named among the Top 20 Most Influential People in VoIP 2012 and currently serves on several boards, including the New Jersey Tech Council. You can follow him on Twitter @arabban.
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