Chapter One

Chapter One

Chapter 1Know Why Service

Matters

Customer Service, 5ePaul R. Timm

© 2011, 2008, 2005, 2001 Pearson Higher Education,

Upper Saddle River, NJ 07458. • All Rights Reserved.

2

Healthy relationships: Key to business and personal success

Succeed by attracting, keeping loyal customers

“Service economy” not as it should be




3

What Happened to the Service Economy?

Ignoring customers

Unmet promises

Incomprehensible customer service people

Jargon instead of answers




4

Ockham’s razor

Wal-Mart vs. K-mart




5

Satisfied customers lead to success

K-mart sales about $50 Billion/yr Wal-Mart sales about $400 Billion/yr

But they sell the same stuff for about the same prices from the same type stores in the same locations . . .

Same, same, same . . . DIFFERENT




6

A “customer” is someone with whom we exchange value

Money for a product or service

Work for wages

Time as a volunteer




7

No one succeeds without loyal customers

External customers: transactions involving an exchange of money

Internal customers: employees and co-workers




8

Relationships with customers can become partnerships

Ongoing relationships Service intimacy Generosity, trust Share joint purpose Speak truth with compassion and care

Pursue equality with grace




9

Positive word of mouth gets and keeps customers

Cost of getting a new customer A friends’ advice or recommendation

Turbocharge with email, blogs, or other electronic communication “word of mouse”




10

How do you calculate the cost of a lost customer?

10-30% loss of customers per year

Customer retention programs= profits jump 25-100%

Ripple effects




11

What are the numbers behind an unhappy customer?

An upset customer tells 10-20 other people

These tell five more The total number affected by one poor experience = 50 to 100!




12

How much does it cost to replace the unhappy customer?

Five to six times more than keeping existing one

About $118 to get a new customer

About $19 to keep one




13

Some key change in the diverse nature of customers

Most diverse customer base ever Wider age range of employees and customers More 60+ customers

Broader globalization means customers from all around the world

More work/life balance




14

Few companies fully back their promise with strategy that

Makes customer satisfaction/loyalty key strategic goal

Trains all employees to use behaviors that make customer feel important

Translates slogans into actions that convey caring to customers




15

Your number one task, regardless of your job title, will always be to attract, satisfy, and preserve loyal customers.

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Chapter One