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Customer service is one of the most important tools for building your business. It can convert someone into a loyal, returning customer — or it can turn them away from your business forever. But even more than that, fostering a positive relationship with your customers opens doors. It can inform your selling strategy, help you improve your product, increase your revenue and more.1

Customer service today looks very different from the customer service of the past. The meteoric rise of the digital ecosystem means customers now expect to be able to reach your business through a variety of digital touchpoints. And they crave personalized interactions every time.2

Giving your customers the on-demand attention they need in an authentic, helpful way can be challenging. But when done well, it’s worth the investment.

Benefits of good customer service

So, you’ve drawn a new customer to your business. Now what? In this moment, it’s time to think long-term. How can you turn this interaction into a sale and this sale into guaranteed future sales? The answer is good customer service. 

Benefits to a small business

The most obvious benefit of customer service is customer retention. When people have positive and productive interactions with your business, they are more likely to return in the future. A very happy customer may even become a brand advocate who promotes your business through word of mouth or via their personal social media.

Creating a loyal customer base in turn creates cost savings for your business. According to Forbes, it can cost five times more to attract a new customer than retain an existing one. And increasing retention rates by just 5% increases profits by more than 25% percent.3 

Good customer service can be a competitive advantage for your product and brand. It reinforces your brand to customers and elevates it above competitors. It can be the factor that ultimately helps a customer decide to choose your business over another.4

Benefits to the customer

There are many reasons why customer service keeps customers coming back. Good customer service is an essential part of the decision-making process. Customers often have questions pre-purchase, and your ability to answer them in a timely and informative way makes their decision easier and costs them less time. And your ability to quickly and effectively rectify any post-purchase issues can ensure that the problem they experienced doesn’t color their opinion of your brand.2

Customers also crave a personal experience. Good customer service makes the customer feel heard and understood. Personalization is one of the hardest aspects of customer service to implement effectively, but McKinsey reports that 80% of customers seek personally relevant interactions with brands.5

Benefits to the employee

Good customer service can even benefit the employees providing it. As they reinforce your brand’s mission and values to your customers, they also reinforce it in themselves, making them feel more connected to your brand.6 

A robust customer service program also gives your employees the tools to succeed in customer interactions, minimizing negative responses from customers and enabling your employees to make valuable sales. And having defined customer service expectations streamlines the selling process.4

How to improve customer service

With so much to be gained from good customer service, even small improvements to your business’s customer service offering can make a big difference. From understanding your customer on a deeper level to employing digital tools like social media and automation, there is always room to grow your customer service capabilities.

1. Understand the customer experience

To understand how to provide good customer service, you should first seek to understand how people experience your brand. An effective way to do this is to build an experience map. A customer experience map includes every touchpoint someone has with your brand or product — from the first advertisement all the way past the point of purchase. This can help you identify and rectify any common pain points and add additional interactions where necessary.7

2. Develop a customer experience that feels personal

Customers want a service experience that feels personalized to their unique needs. They don’t want to feel like just another number — they want to see that they matter to you. To deliver this, you need to understand what drives your customers. What motivates them to seek your product or service? What value can your business bring to their life? What pain points are they trying to solve?

All the information you can glean about your ideal customer can be used to form a customer persona. A customer persona is a generalized profile of who your customer is, including information about their personality and behaviors. It should serve as your reference point when you’re developing both sales and customer service tactics, helping you stay focused on what your customer is actually looking for.8

If you have access to data about your customer, you can use it to inform your customer personas. Examples of data sources include social media behavior and metrics and website traffic. If you don’t have access to that kind of data, start by analyzing your own experience with your customers. Look back on your conversations with them and look at reviews they’ve left. Adding a product and service survey to your checkout process is an easy way to start gathering valuable qualitative and quantitative customer data.8 

3. Set up multiple touchpoints

In today’s digital world, customers demand instant access to your business. As a small business, you might not have the resources to offer the breadth of communication channels a larger business might. It’s important to identify where your customers are most likely to contact you and make those channels available.9 High-value touchpoints include:

  • Social media: Social media lets you speak directly to your customers through posts, comments and messaging features.
  • Website content: Your website is a valuable tool for product descriptions, but it can also house blogs, newsletters and other communication tools.
  • Self-service resources: Having established FAQs, product manuals or troubleshooting advice can save the customer the need to get in touch.
  • Phone: Calling may be less common today but it’s a good way to provide a dedicated point of contact to customers and it can set you apart from competitors who don’t offer a call option in their contact information.

4. Automate where possible

Automation can help you ease the burden of customer service from your employees. Setting up a chat box function on your website that can answer frequently asked questions and triage the questions from customers to the appropriate contact will reduce the time you spend on it as well as the time it takes for customers to receive a response. A chat box is also another great place to insert a feedback survey.10

5. Empower your employees

Customer service doesn’t come naturally to every person, so it’s important to offer training for your employees from the start. Try role-playing customer interactions so employees can become more comfortable with different types of questions and situations. Make sure they are thoroughly trained on any technology required to enable your customer service approach. Establish a communication hierarchy for when issues need to be escalated. Give them the tools they need to help your business succeed.11

6. Ask for feedback

Only your customer can completely speak to their experience with your brand. Sometimes feedback can be hard to hear, but if you’re willing to make changes based on real customer testimony, you’ll be able to offer a stronger customer experience in the future.

Discover other tips for growing your business

Good customer service sets a business apart from the competition. And for small businesses, excellent customer service can mean a world of difference. Try to meet your customers where they are and work to understand their needs so you can provide service that not only meets, but exceeds, their expectations.

Nationwide’s Business Solutions Center is available to help small businesses continue to grow their resources with tips and tools built for your success.

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The information contained in this blog was obtained from sources believed to be reliable to help users address their own risk management and insurance needs. It does not and is not intended to provide legal advice. Nationwide, its affiliates and employees do not guarantee improved results based upon the information contained herein and assume no liability in connection with the information or the provided suggestions. The recommendations provided are general in nature; unique circumstances may not warrant or require implementation of some or all of the suggestions. Nationwide, the Nationwide N and Eagle, and Nationwide is on your side are service marks of Nationwide Mutual Insurance Company. © 2022 Nationwide