Customer service is the biggest retail cliché around. It is amazing that NOBODY ever disagrees with its relative importance, even
though hardly anybody can quote any real evidence as to why it works, and very
rarely prove its efficacy anyway.
Has ‘customer service’ has just become a bogeyman for
retailers to lump all their issues together instead of dealing with poor
systems, product quality and organisational culture and so forth? That is; for
lack of imagination in identifying the real issues, they just blame it on customer
service because it makes intuitive sense.
In fact, there is plenty of evidence THAT customer service
works:
- IBM (1994-1999) saw a 5.5% increase in customer satisfaction
coincide with savings of $7Bn and a stock
price that increased x1000! No doubt that better customer service would not
be the only causal factor in this equation, but it is also not the only piece
of research
- Another study (Harvard, 1994) found that employees who felt
that they were meeting customer needs had 2x
the job satisfaction level of employees who did not believe they were
meeting customer needs. The relationship between cost savings and job
satisfaction has proven time and time again.
- The same study found that more than two-thirds (of customers) defect (and stop using your
service) because they find service people indifferent
or unhelpful.
But as they say in the classics: ‘lies, damned lies and
statistics.’ Research can be made to prove anything if you know how to play
with the numbers.
Can anyone explain WHY
customer service leads to customer satisfaction, and not merely postulate that
it does because it seems to be a
sensible assumption?
The answer is pretty simple and dates back to 1890 – almost
120 years ago! Pavlov introduced us to the concept of conditioning and
‘association’ by proving that the dogs produced a physical response to an
external stimulus (the bell) simply because that stimulus became associated
with food.
If you think Pavlov’s bell has very little to do with modern
marketing principles, consider this: Why would Holden (or any car manufacturer)
always put a beautiful girl in or next to their car in their advertisements or
at the car shows? (PS*)
The answer is of course that they are drawing on the power
of association, wanting prospective buyers to associate one kind of beauty with
another – so to speak.
In exactly the same way, customers will come to associate
visiting your store with a pleasant experience if they are ‘conditioned’ by specific
stimuli (good customer service). Retailers who succeed at creating and
delivering the right stimuli will find that customer satisfaction becomes a
conditioned response and all it will take is a trigger like a simple smile of
acknowledgement from a sales assistant.
Good customer service delivers the results, and there is
plenty of scientific evidence that it is positively correlated with financial
performance and there is sound underlying scientific principles to prove how it
works.
The question is though: Why the heck is customer service training so poorly done? More about that some other time...
Dennis
PS* I wonder of many of the young marketers at the car
manufacturers actually know why they are doing what they are doing or whether
that is simply a habit?
