Is customer service overrated?

The role of ‘fit’ customer value is the subject of numerous articles, presentations, company values and leadership talks.

And the subject has kept many a CEO and consultant gainfully employed. Yet I do wonder if the broad term of customer service is somewhat overrated?

The purpose of a business is to create and keep a customer.

Perhaps I am a little sensitive to this topic; although what I see pass for customer service at the customer touch point is often little more than a scripted mechanical dissertation that might tick the three to five customer service standards delivered by the business hierarchy yet in reality fails to satisfy a customer.

Recently I had some first-hand experiences that demonstrated to me that whilst the customer service and, therefore, experience was adequate, it actually failed to deliver the one differentiating and far more significant generator of a longer-term loyal customer and that is simply the creation of customer value.

In other words, customer service and customer value can often be contrasting variables to the entire customer experience.

Satisfactory customer service will no longer differentiate one business from another in the competitive landscape. Satisfying the basic expectation of a shopper is no longer in itself a strategic differentiator for a business.

It is simply not enough to satisfy a customer – it is vital to create and keep a customer. It will cost you five times more to win a new customer than it will to retain a current customer. So by providing real value to the customers you have, by going above and beyond the standard customer service ‘rules’, you will find your existing customers will be loyal to you and will tell others of the great service and value you provide.

Let me explain with an example…

Recently I went to a national chain retailer of books, to purchase an audio version of a recently released autobiography as a gift for a friend. I also knew that a competitor offered this product online.

The service I received was pleasant and met the standard criteria of being acknowledged, the script rolled out seamlessly and therefore the customer service element was delivered, yet the customer value was not.

I was directed to a competing retailer and – although I was given a bright and friendly farewell – we did not do business. I am not predisposed to think of that retailer as a retailer of choice. Instead, off I go to a competitor who may well provide that customer value I seek and they now have the opportunity to have me as their loyal customer.

Now imagine this scenario being a little different. What if the book retailer exceeded their customer service standards? What if they took my order and collected my details for their database and even, perish the thought, ordered the product from a competitor for me? That would have created real customer value, generated a loyal customer, and formed a relationship with a customer who will return to the shop, website, and other forms of that retailer’s direct communication. And of course, tell others of this positive experience.

This is a simple example that shows that even by following the customer service ‘rules’, retailers can, and often do, miss the opportunity to add real customer value. These businesses would no doubt value customer service very highly (and rightfully so) yet there will be numerous opportunities to generate real customer value and the retailer needs to take steps to ensure they reap the benefit these opportunities present.

The business fitness tip this week is to ensure that our businesses are actually focusing on creating, winning and keeping customers. On occasion, we may even lose a little money, may go well out of our comfort zone, might even do business with competitors to secure the customer, may even have to break a few rules and definitely focus our energies on creating and keeping a customer.

Happy ‘fit’ retailing.

Brian Walker is the managing director of Australasia’s leading retail consultancy, Retail Doctor Group.