The Repercussions of poor Customer Service

by | Jul 4, 2014 | Customer Service

“It is so much easier to be nice, to be respectful, to put yourself in your customers’ shoes and try to understand how you might help them before they ask for help, than it is to try to mend a broken customer relationship”. – Mark Cuban

Every company wants to remain in business and be successful, even way in to the future. They want their customers to be happy with their interactions so that the customer remains with them. The financial success of a company is ensured by having happy customers through great customer service. Poor Customer Service has a completely reverse effect and can steadily put the company out of business for good. Uninspired and mundane customer service has the potency to mar the reputation of a company beyond repair. Even customers understand and are willing to overlook minor lapses given that it would be impossible to please everyone at all times. Despite this, the overall expectation from companies is that they deliver impeccable standards of customer service most of the time. Customers have become more demanding in the knowledge that they can expect superlative levels of service and companies will have to do whatever it takes to maintain those standards. Shoddy and poor customer service is now in the “zero tolerance zone” for customers most of the time. And why not – your competitors are just waiting to scoop up any business you ‘give away’ through bad service.

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As technology permeates the lives of all, the average customer too is getting smarter and more aware of his or her rights as a customer. This smarter breed of customers are also less patient and more likely to leave if they perceive sub-standard levels of customer service or are treated poorly by your company. The repercussions of poor customer service can be far reaching and highly damaging. A customer who has an unpleasant experience or interaction with your company will most certainly talk about it to a number of people, igniting the fire of customer attrition. As the number of dissatisfied customers increase, profits and growth will decrease at a faster pace than you will be able to manage.
Customers have been known to defect from a company due to poor customer service and never return. And your competitor is the one who stands to gain from this. In addition, since your competitor is aware of what you did wrong, they would make every effort to please the customer by doing the right things, making it even tougher for you to win the customer back. It is not difficult to know that customers will make use of the ready information that is available to find alternative solutions for themselves. Why must they make any effort to understand your poor customer service, when there are so many companies willing to go the extra mile to please them? So what repercussions are we talking about?
– It is simple enough to know that the time and effort you need to invest in retaining a customer is much less than having to attract a new one. With ever increasing competition, you really must be outstanding both in product or service and customer service, to clinch a deal. This takes concerted effort and if you don’t have a very strong reputation especially for good customer service, it will cost you even more both in terms of money and time. Losing customers due to poor customer service is your most serious fault.

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– During an interaction with your company, if the customer feels that your customer service staff is unable to understand his or her needs dissatisfaction will set in. The customer expects that the staff is able to clearly comprehend what he or she is requesting and the absence of this would lead to the customer contacting someone who will understand. Customers don’t have the time to suffer this kind of service incapacity. Obviously, this will have a direct and instant impact on the sales figures.

– Negative talk about your company will be extremely detrimental. The customer that walks out through your door dissatisfied is more likely to vent their ire through whatever means possible. Even if we don’t take in to account the impact and reach of social media, an angry customer is sure to tell by word of mouth as many people as is possible. The chances of directly telling his or her contacts not to use your company or worse patronizing the business of a competitor will start the countdown to your company’s failure. You should begin the process of shutting down your business if the customer is vexed enough to showcase your poor customer service on social media. You will lose many current and prospective customers if this one angry person decides to wage war on you.

– If you as a company have to keep constantly allocating resources and budgets to attract new customers, it will steadily lead to a loss in profit margins and ultimately lead to huge losses. Providing great customer service can save you from these disastrous consequences.

– Your customers would be from varying industries and would have different needs however the need to receive great levels of customer service is all permeating. Losing even one customer from any segment can start the domino effect, causing more customers from the same or different segments to leave in order to avoid your poor customer service. Your customer problems will become a known fact, and will keep even the prospective ones at bay. Leading to further loss in business and the resultant loss of profits.

– As discussed earlier, no customer complaints do not necessarily mean happy customers but probably indicative of customers who have given up hope of receiving great customer service. Such customers don’t even tell you what is wrong and just leave. This could prove to be a severe handicap when trying to ascertain why they went away. Not keeping tabs and constantly monitoring customer behavior from a customer service perspective will have repercussions far more serious than fathomable.

– You also pay another huge price for poor customer service – disgruntled employees. When employees can see that the company they work with is having problems sustaining themselves, they are more likely to jump ship. Again attracting fresh and talented employees is far more expensive than retaining the ones you have. Each employee that leaves takes with him or her, the huge chest of knowledge, skills and hours of training. The new employee will need investment once again both in terms of time and training to match their knowledge base to your particular company. Also when employees leave and in all likelihood join competition, they also spread word about the incompetence and deficiency of your company. Certainly won’t do much to help your case! Competition also stands to gain from their knowledge base and training that you had invested in. A sorry state of affairs, undoubtedly.

The repercussions of poor customer service seem to therefore, have a direct influence on both customers and employees, which will make a serious dent in your profits, growth prospects and market reputation. It is rather alarming to see how easy it is to incur the wrath of your external and internal customers and how costly it can be. It is equally hard to win either of them back without the liability of a huge amount of resources. Make a sustained enquiry in to the reasons for poor customer service and put in to place immediate action plans to raise the level. Your customer service staff must be able to see the direct impact customers – happy and vexed – have on the business and on them. Being polite, enthused, compassionate and empathetic is all it takes to make customers happy and make happy customers loyal. Rude and rote staff is a sure shot way of telling your customers that you don’t care about them enough and will send them rushing out your doors. Poor Customer Service or Excellence in Customer Service – the choice is yours!

“Statistics suggest that when customers complain, business owners and managers ought to get excited about it. The complaining customer represents a huge opportunity for more business.” – Zig Ziglar

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