The ROI of customer service

roi of customer service

Globally speaking, we are sucking at customer service. Sorry, but it’s true. It’s not really a question of whether customer service needs improvement. It’s more one of what’s holding companies back?

In a lot of cases, perhaps most, it really boils down to a reluctance to make the financial and time investment that is required to move the customer service bar. And the reason people are reluctant is because they know that at some point, somebody’s going to ask them to justify they commitment. Someone’s inevitably going to look at a customer service training or other initiative and say, “What’s the ROI of this?”

It’s a great question. An awesome question. An absolutely must-be-asked question. It’s also a bit of a trap, because most of the answers people typically give are pretty squishy at best. They are squishy because the impact of outstanding customer service is both dependent and cumulative. It is dependent because customer service is not a thing. It’s a How, not a What, and they are hard to separate when it comes to analytics.

The impact of customer service is also cumulative. I have a good experience at a restaurant. A month later, I take a friend there. We both have a good experience, so a month after that, we each take someone there… You get the picture. Six months down the road the restaurant might see a nice lift in its repeat customer metrics – but that’s assuming that they stuck to their guns in their customer service training, coaching, etc.

Customer service is like vegetables

it’s kind of like vegetables. We all know that there is a mountain of evidence telling us how good vegetables are for us. But what was the ROI of that carrot you had at lunch today? What metric do you have to prove that last night’s salad directly impacted your health? Silly questions? Of course. Yet we still pile them high on our children’s plates.

Is there an ROI to improving your customer service? Absolutely. Want to measure it? No problem. Just don’t try and do it monthly or weekly.

Make a commitment. A real commitment. Look at core business metrics like number of complaints, repeat business, average sale value and – yes – overall sales. Then do everything in your power to get good at customer service and stick with it solidly for a year.

Then look at the numbers again.

“I’ve never seen a company fail because its customer service is too good.” – Shaun Belding, Entrepreneur Magazine

The ROI of customer service
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