While it’s important to have salespeople who can meet their quotas and find new customers, your customer service reps are one of the primary ways you can keep existing customers, increase their spend, and improve your bottom line. Here’s how you can tell the effect your customer service reps have on your profit margin.
Sign #1: Good Retention Rates
New customers are certainly important to the growth of a business, but if you want to look at what customer service is contributing to your revenue, look no further than customer retention. This is absolutely critical for growth in any company; the key is to hold onto customers through excellent customer service. That way the only direction you have to go is up!
Unhappy customers will leave and never return without providing you any feedback. To avoid this, you need to focus on customer service. Loyal customers are said to be worth up to 10 times as much as their first purchase. If you see an increase in the customers who are sticking around, you know that that is contributing to boosting your bottom line.
Sign #2: Good Company Reputation
People will write great reviews, tell their friends, share your social media pages, and follow your blog more often when they know that a part of your business is great customer service. You rarely see overwhelmingly great online reviews that do not, at least in part, discuss excellent customer service as a part of their experience.
Did you know that news of bad customer service reaches more ears than praise for a good service experience? If you notice that your brand’s online reputation is extremely positive and that it has been steadily improving over the course of time, you likely have customer service (rather than sales or marketing) to thank for it.
Sign #3: You are in a Place to Increase Prices
According to Talk Desk, 70 per cent of U.S. customers are willing to spend more money when they know that company guarantees good customer service. This means that when you do have excellent customer service, you have more wiggle room with your pricing. Once you know for sure that people are satisfied, you can experiment with your prices. This is a profit-generating move, which stems from the security that comes with customer service efforts.
Sign #4: Improved Conversion Rates
Customer service is absolutely key in converting potential customers to sales. A person’s experience from start to finish with your team, both online and offline, will impact whether they choose to follow through with the sale. Let’s face it: People walk away when they receive poor customer service, even if it was something they really wanted to purchase. If you notice that conversion rates have been improving, you can thank those directly behind the customer’s service experience.
Sign #5: Your Company Generates New Business
Without a doubt, sales is just one component of attracting new business. News of good service is spread through word of mouth, reviews, and overall reputation. When all of these are in place, it is easy for new customers to walk in your door or land on your website and want to complete a transaction. If you have noticed that the number of new customers following through with purchases has increased, it is definitely customer service that is assisting this boost in increased business.
These are just a few of the signs this department is contributing to the increase in your bottom line. Both directly and indirectly, your customer service team is an important part of your company’s profit margin. With that in mind, encourage your sales and customer service departments to work together so they can work in tandem for your company’s bottom line.
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