Profitable Customer Service
Recently, a friend of mine sent me a study (Watermark Consulting) showing the correlation between high customer service and profitability. The results were as I expected, but the numbers were stunning nonetheless.
Customer Experience Leaders out-performed the S&P 500 by a staggering 35 points. These companies are making the client/customer experience the driving force in their business. “This delivers tremendous strategic and economic value to a business, in a way that is difficult for competitors to replicate“. Why is it difficult to replicate? I would argue that most business owners either do not see the value of great service or they are slothful and lazy and quite possibly both.
Which leads us to the Customer Experience Laggards who floundered around at the bottom, 45 points LOWER than the S&P. I would suggest that this is the reason that two businesses go under and out of business every five minutes in the US. (Commerce Dept). Negative customer experiences slowly and insidiously kill off businesses. Customers are frustrated, client AND employee retention are low, thereby driving up the operating costs to attract new customers and attract and retain new employees.
Those that lead the Customer Experience enjoy higher revenues through better retention and less price sensitivity, the report continues. They also have LOWER expenses due to reduced complaints, lower acquisition costs and their customers require LESS intensive service because they are loyal and happy.
This study should not be shocking to anyone that already delivers a fantastic client or guest experience. However, if you are floundering around financially you may want to examine the level of service, or lack thereof, you provide your clients and customers.
One of the big lessons that I taught at Disney that is stated in this report is that great service providers have the basics down cold and then are able to deliver little pluses that add up to big time magic. For example:
I taught the busboys in the restaurants all of the standards on how to keep the dining room, their stations and their tables clean. They had specific checklists and checkpoints throughout their shift that had to be completed in order to deliver a good experience for the guests. Once they had those specifics nailed down, then they could take the time to deliver the little pluses (taking a family photo) that make a Disney vacation a magical one. But if they never completed their job (keeping a clean dining room) no amount of pluses would overcome a filthy dining room. That is how the magic is created.
Take the time NOW to observe a client or guest interaction in your business. (Or if you work by yourself, take the time to examine your last interaction from a different viewpoint). Are you and your employees delivering on the basics? If not, you need to work on this now. If you do deliver the basics that creates a satisfied customer, what little pluses are you and your team doing that will create LOYAL customers, who come back time and again?
For more on service standards and small business marketing, check out my free special report “Systematic MAGIC, How to Disnify Any Business”. Vance Morris is a Walt Disney World Resort Management Alumni, having spent 10 years as an executive in the Resorts. He runs the only Disney Service & Direct Response Marketing business on the planet. Here he coaches companies to create Disney Style Service Systems and then monetize them through direct response marketing. He is also the GKIC 2015 Marketer of the Year. He can be reached at www.DeliverServiceNow.com or firstname.lastname@example.org .