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13thJul2016

What Are the Effects of Bad Customer Service?

What Are the Effects of Bad Customer Service?

If you throw a pebble into a lake, a ripple will form. This example is just one of the many classic examples of the cause and effect theory. In the business world, what happens when you deliver bad customer service to consumers?

In this special article, we discuss the main effects of bad customer service and include some helpful tips on how to get back on track.  

Negative Effects of Bad Customer Service

A Tarnished Reputation

No business can succeed with a trail of bad customer service experiences behind them. Your business, no matter the industry, needs to project a positive and likeable brand. Even though the way we do business changes with technology, ease of access and other innovations, the core principals of customer service still apply.

#MainTakeaway: People buy from people they like.

Take off your entrepreneur hat and put on your consumer hat. What makes you buy from a particular company? What types of research and investigation do you perform before handing over your money for a product or service? Do you listen to your friends, family and colleagues when working with a new company?

If you’re like the majority of modern consumers, the following statistics and approaches will seem familiar to you:

  • • 92% of consumers report that a word-of-mouth recommendation is the top reason they buy a product or service.
  • • 76% of consumers recommended companies they trust to a friend or colleague.
  • • 58% of consumers trust a business which has positive online reviews.

In general, your future customers will be swayed by your online and offline reputation. No one wants to do business with a company that receives bad reviews; they won’t feel confident and comfortable to buy from you.

Your brand will take a severe beating (that could take years to undo) if you deliver poor or inadequate customer service. As such, you need to stay on top of your customer’s experience to ensure their complete satisfaction.     

We constantly update our blog with articles that help you improve your customer service so your reputation isn’t tarnished. To learn some insider customer service tips, check out our latest articles:

• 5 Successful Business Leaders Give You Their Top Customer Service Tips

• 10 Customer Service Goals Your Small Business Should Reach For

• 5 Creative Ways to Gather Customer Feedback

Increase in One-Time Buyers

When a consumer is unhappy with how their transaction was handled, your business will see an immediate decrease in customer loyalty. What does this mean in layman’s terms? If you gave poor customer service to someone, chances are, that will be the first and last time they purchase from you. 

#MainTakeaway: You have one opportunity to make a lasting impression.   

The majority of business models rely on continued, reoccurring purchases from customers. One of the biggest effects of doling out poor customer service is blowing your chances at repeat business from your customers. If you’re running your own business, we hope you’ve looked into how expensive finding new customers is.  

What is the cost of acquiring a new customer compared to the cost of keeping an existing customer? It is believed that, “65% of a company’s business comes from existing customers, and it costs five times as much to attract a new customer than to keep an existing one satisfied.”

Your customers will seek out the products and services of your competitors if they’re treated poorly. Here are some situations that will leave your customers dissatisfied enough to end their relationship with your company: 

  • • You don’t offer a customer service representative to answer their questions. 
  • • They’re not satisfied with how you handled their complaint.
  • • After receiving a faulty product or inadequate service, no refund or exchange options were offered to rectify the issue.
  • • One of your customer service representatives was rude or unprofessional to them.
  • • You keep them on hold for long periods of time when they call in to settle a dispute.

It’s important to tend to your current customers and earn their continued business. Don’t give the effects of bad customer service a chance to spread within your organization. Nip customer issues in the bud as soon as they come to your attention to prevent losing future business.

If you’d like to read detailed customer service tips when it comes to keeping your current customers happy, check out our recommended articles: 

• Customer Service Tips: How to Handle an Angry Calling Customer

• 10 Tips to Handle Angry Customer Calls

• Anticipating Your Customers’ Needs for an Exceptional Experience

When taking customer service calls personally; outsourcing to a call center; or training an in-house support team, make sure you stress the importance of keeping customers happy.

Customer Service Statistics

In our published article, Customer Service and Telephone Statistics Your Business Should Know, we share vital stats you need to consider.

  • • 67% of customers hang up on a phone connection out of frustration they could not talk to a real person.
  • • 75% of customers believe it takes too long to reach a live agent.
  • • 78% of consumers bail on their intended transaction because of a poor service experience.
  • • On average, loyal customers are worth up to 10 times as much as their first purchase.

To eliminate customer dissatisfaction, find solutions to these chief customer service complaints listed.

Focus on Providing Excellent Customer Service!     

Excellent customer service defined is, “providing superior and quality service to customers during all interactions.” Train your company’s representatives to provide professional, helpful and courteous customer service at all times. This will help you avoid these negative effects of bad customer serviceentirely. 

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If you don’t have the time or resources to devote towards perfecting your customer experience, maybe it’s time you looked into outsourcing this vital task. Professional call centers are trained in running full customer service departments offsite so that you don’t have to worry about it.

To discuss your business’s customer service needs, give us a call today at 1-800-785-6161 to speak with our account specialist. 

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