“Profitability is coming from productivity, efficiency, management, austerity, and the way to manage the business.” – Carlos Slim
A top and highly successful retail chain owes its success to the fact that it keeps its costs down through the robust implementation of various strategies. They have been able to reduce customer service costs and pass on these savings to their customers – the result is that customers get top quality products and service at rates that no other chain has been able to match. The in turn has translated to a huge customer base that is loyal and profitable.
While every company must have top class customer service all are unable to reduce efficiently operating and customer service costs, to achieve it. Companies end up spending humongous amounts on ensuring customer satisfaction but are unable to cope given that they do not focus on reducing customer service costs. Effective customer service solutions are fast becoming the most crucial element and differentiators of a successful business but only those companies that can reduce costs, will be able to sustain it. Research has proved that over 90% customers will stop doing business with a company if they receive shoddy service. Poor service levels come about when a company does not have a robust customer service strategy in place, which should include looking at ways to reduce customer service costs. With limited resources and myriad options for customers, it would be prudent for a company to focus relentlessly on keeping their customer service costs down so that they can pass on the benefits to their customers leading to retention and loyalty.
While customer service is possibly now the most critical part of any business, a company must also balance the costs of service with their overall business to achieve long-term and tangible results. This also means that companies that reduce customer churn by simply stepping up service would gain leadership. However, it would be imperative simultaneously to reduce customer service costs and other operating costs in order to sustain the company’s advantage and lead. Companies cannot hope to survive by providing just the basic or average level of customer service but as soon as they decide to step up service levels, the costs do go up exponentially and is probably the reason that some companies settle for average customer service. There are a number of ways that companies can reduce customer service costs without negatively affecting the quality of service. Does your company follow a systematic approach to keeping its customer service costs down?
Almost every business and customers are linked through social media networking and these platforms have becoming hugely popular now. Social media is fast, inexpensive and possibly the most preferred channel of communication for customers. By responding to customers, providing swift service, updating information and providing interesting content – companies would not only be meeting customer needs but would also be creating a strong brand identity at minimal costs. Customers seek fast and easy service – research shows that at least 55% customers expect a response, when connecting via social media, the same day. Companies that can match up to this would have a happier customer base and see a drastic reduction in customer service costs.
Despite being the most important resource, employees are sometimes the most neglected lot. It is not easy to find top class customer service personnel and hiring and training them is a huge cost for any company and so it would make sense that they be taken care of well. By treating them with respect, empathy and by putting in place employee friendly policies, a company would be able to reduce the attrition levels in this particular employee segment, which in turn would mean a reduction in customer service costs. Happy and energized service agents will provide the best care and service to the customers translating to low customer churn and higher profits. It is important for a company to pay attention to the welfare of their customer service staff – good compensation and benefits, reward and recognition and training programs, regular feedback from them and other such activities that enhance involvement and a willingness to give their best. A lot more can be achieved through a smaller but effective task force than a large number of demotivated and callous employees. “If you think it’s expensive to hire a professional to do the job, wait until you hire an amateur”. – Red Adair
Further on the quote above, a sure way to optimize the number and time of customer service staff and giving your customers the best experiences and service is to ensure that the service employees receive regular training and coaching. The training programs must focus on a wide range of topics that would cover all the important facets and traits of great customer service. The quality and efficiency of the customer service would be directly proportional to the training and coaching they receive. Boosting their productivity and reaching optimized efforts would in turn lead to maximum output and enhanced levels of customer support, which would translate to more being accomplished by few and in a shorter span of time. In addition, companies must choose the most effective and updated technology that will reduce effort and stress of the service agents on a daily basis. More productive and efficient service agents would be able to provide more first call resolutions and speedy appropriate responses. This would mean that the agents would reduce customer effort, making them happy and more willing to come back to the company, taking the company closer to success through increased profitability.
Another way to reduce customer service costs without compromising on quality is by providing live chat and an updated FAQ segment. Through live chats a customer is able to connect with customer service personnel and get a response / resolution of queries and issues immediately without added cost to the company or the customer. The Frequently Asked Questions segment that is regularly updated will enable customers to get answers to their questions immediately without the hassle of connecting in any other way with the company. The customer is happy because they save time and effort and for the company it is a means to providing great customer service without additional costs. These two methods are highly efficient yet cost effective means of serving customers, thereby increasing satisfaction levels while reducing the customer service costs for the company.
Companies can gain more recognition and ensure that customers and other readers spend more time on the company’s website by enabling self-service and troubleshooting guide options. Not only does this enable customers and others to gain more information about the company and its products, it also helps them find a solution to their problems and since they ‘discover’ it themselves, it lends a feeling of being in control. This is not only a great way to provide great service but also to reduce customer service costs. In addition, as customers spend more time on the website, they may be more inclined to buy, especially if they find a product or service they were not aware of or did not know existed, increasing the sales of the company.
Through these methods and others that your company might be following, it is possible to provide high standards of service without burning a hole in the company’s ‘pocket’. These methods are simply about utilizing tools that are relatively inexpensive, may be even free of cost, and if used well can replace traditional methods of serving customers. Smart companies are those that effectively use tools and options that keep their customers pleased while reducing their customer service costs.
