Guide To Customer Service

Updated July 21, 2022

Customer service refers to all contact you have with your clients and consumers. This includes solving problems, answering questions or facilitating purchases. Great customer service can add a lot of value to a business, including an improved brand reputation, higher customer retention and stronger customer loyalty.

In this article, we will explain what customer service is, why it is so important to businesses and what steps you can take to improve your customer service.

What is customer service?

Customer service is a one-to-one interaction between a business and a customer. The term includes all the support a customer might need, beginning with the initial purchase and throughout the lifecycle of the product or service. Great customer service can improve satisfaction and increase future sales by encouraging repeat business and more promotion from loyal consumers.

Delivering comprehensive customer service requires a combination of efficient, helpful automated systems and friendly, knowledgeable customer service representatives. Today, businesses have a variety of tools that make it easier to provide personalized and satisfactory customer service, including social media, automated chatbots, SMS text support and applications.

Using a combination of tools, trained staff and a comprehensive customer service strategy, companies can provide valuable customer service at all stages of the buyer's journey.

Why is customer service important?

Great customer service is an indispensable piece of the overall buying experience and has a direct impact on your business's revenue and reputation. Investing in comprehensive and high-quality customer service will help your business in the following ways:

Increased customer retention

Great customer service improves overall satisfaction, which makes consumers more likely to buy from your company in the future. An increase in customer retention is a great way to increase earnings without needing to substantially increase costs.

Improved brand reputation

When people are satisfied with their experience, it solidifies your brand's reputation as trustworthy and dependable. Moreover, visible pieces of your customer service strategy, including social media engagement, will be seen by your current customers and possibly a broader audience of potential clients.

Increased brand loyalty and endorsements

Great customer service demonstrates that you're listening and care about their questions and concerns. This increases loyalty since customers know they can rely on your brand. These loyal customers are also more likely to recommend your products to their friends and family. These endorsements can lead to new customers who will then potentially become loyal too.

Better data and feedback

One dimension of customer service includes actively seeking feedback from buyers to help you improve your products, services and brand messaging. When the entire customer service experience is positive, you're more likely to receive good reviews and feedback.

Higher earning potential

Most customers are willing to pay more for better service. You may be able to build the added cost of a robust customer service strategy into the price of your product.

8 tips for good customer service

Maintaining an exceptional level of customer service requires active goal setting, planning and measuring so that you can continuously improve your customer's overall experience with your brand. In this section, we'll go over some of the most effective ways to develop and implement an effective customer service strategy:

Set clear targets

In order to know whether or not your customer service strategy is working, you need a clear definition of what your expectations are. This means having clear, measurable goals for what you want that strategy to accomplish.

Customer service goals you might want to set include:

  • Fast average response time

  • Low or no ticket backlog

  • Short wait times

  • Fast average resolution time

  • High overall customer satisfaction

Consider creating SMART goals to track your success. SMART stands for Specific, Actionable, Relevant and Time-based. For short wait times, for example, identify a specific average wait time you want your customer service team to achieve.

Read more: SMART Goals: Definition and Examples

Audit your existing customer service strategy

Once you have defined your goals, you should see how your existing customer service strategy performs on each of those goals. Determine which goals you have already met and which ones you have not yet achieved.

At this stage, you may need to change your goals according to the results of your audit. For the goals you've already met, you might want to set a more ambitious target. For goals you haven't met yet, you might want to set smaller milestones to help you work toward it.

Your customer service audit should include a thorough examination of all the data you have on how your customer service is performing. This might include data on the number of unanswered calls, any surveys you've done to measure customer satisfaction and the number and type of complaints received.

Compile all of this data and identify the most significant strengths and weaknesses seen in this data. The goal is to find out exactly what you are already doing right and what needs to be improved.

Revise your strategy

Based on the results of your audit and the goals you set, develop a revised customer service strategy. This should include specific adjustments for how you will engage with your customers and your approach to responding to requests. It should also include your plan for communicating these changes to the company. Every customer-facing employee, even those not directly working in customer service, should be informed of the changes being made to the customer service strategy.

If you want to better understand how the changes will impact your metrics, consider A/B testing the changes you make before you fully implement them. For example, if you make changes to the script your customer service representatives use, begin by having only a small number of representatives switch to the new script, then track their metrics compared to the representatives who are still using the old script. The results of this testing will help you determine whether or not it's worth making the change.

Identify your key metrics

As you implement your revised customer service strategy, you need to immediately track the metrics that will help you determine the success of the changes. Choose metrics that make sense for your goals.

For example, if you are trying to improve your average resolution time, you might track your first contact resolution rate. This metric tracks the number of requests that are resolved by the first representative the customer came in contact with. Another relevant metric for this goal would be the average ticket handling time, which tracks how long it takes from the first contact to resolution.

Identify which metrics will be most effective for measuring progress toward your specific goals.

Related: How to Set and Track Project Milestones

Choose your tools

There are a number of tools available to execute your customer service strategy. Perform some research to find tools that best fit your needs. A strong customer service system should feature multiple points of contact with your clients so that they can communicate with you in the form they are most comfortable with. For example, you can offer customer service via phone, email, online chat, social media and text messaging.

You could also consider using automated customer service systems like chatbots, automated phone response systems or help desk software. Build a comprehensive set of self-service tools, such as an extensive FAQ page and online forums where customers can answer each other's questions.

Incentivize great customer service

A great customer service strategy can work better if you motivate your team to use it. Incentivizing your employees is an effective way to motivate them to work toward goals set in the new strategy.

Incentivization can have a number of forms. You might offer bonuses to representatives who achieve established targets. Another option is to host a party or catered lunch for the customer service department if they collectively meet certain milestones for the quarter. You can get creative with your rewards, but it can be helpful to create them in consideration of the company's budget and office culture. If you're unsure, select a few different ideas and have your team vote on the one they like the most.

Related: 4 Leadership Activities to Empower Your Team

Track qualitative data

Many metrics measure quantitative insights about how your customer service strategy is performing. However, you also need qualitative data for a better sense of how the perceptions around your brand shift. Qualitative data can be gathered using customer surveys with open answers.

A less direct approach is to monitor social media conversations about your brand. This involves tracking hashtags and mentions related to your brand to see what people are saying. Track conversations your brand actively participates in as well as ones you're watching. This qualitative data allows you to see how your new customer service strategy affects your brand's reputation and image.

Schedule regular audits

To provide a consistently great customer service experience, your strategy needs to be flexible. The needs and expectations of your customers will change as your business launches new products and services. Moreover, there are new tools released regularly that could be valuable additions to your strategy.

Regularly auditing the performance of your customer service strategy will allow you to quickly identify issues as they emerge and how to implement new tools and trends. Ideally, you should complete an audit of your customer service once every one to two years.


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