Insights and Ideas | an XACT Blog

How great customer service boosts retention and saves money

Written by XACT on . Posted in . Leave a Comment

young man hands holding credit card and using phoneHave you ever tried to get a hold of a company because you have a question or concern but you were left on hold for ages or maybe couldn’t get a hold of anyone at all? It can be incredibly frustrating for a person when a company is hard to reach, so annoying that you may decide you no longer want to do business with them. It’s equally irritating when the agent you do reach isn’t as helpful as you’d like them to be. Maybe they’re not really knowledgeable, they transfer you to the wrong person, or aren’t overly friendly. You can quickly see how a friendly, helpful agent who is easy to reach will increase retention.

That’s not the only way that customer service can increase retention either. You can use this service to put out surveys and see how satisfied customers are. You can use the surveys to help improve and deliver upon customer wants and needs. Another way to boost customer service initiatives and retention is to offer a loyalty program. This rewards customers for staying loyal to your company and is designed specifically for retaining your current clientele.

How does retaining your current customers help your business financially? Well, we know that it brings in income every time they make a purchase, but it also reduces the amount of money you need to put into ad campaigns trying to entice new customers. As this article from Forbes says, “Retaining a customer is much cheaper than acquiring a new customer. Studies suggest that depending on the industry you are in, acquiring a new customer can cost five to seven times more than retaining an old one.” However, they also point out that “it can never be customer retention versus customer acquisition.” Companies grow by “acquiring new customers.” But retaining your current base can reduce the amount of money you need to spend on customer acquisition. For one, you may not need to put as much emphasis on this because your company isn’t as desperate for new clientele. Another way retention saves you on marketing efforts is through word-of-mouth advertising. When satisfied customers remain loyal, they’ll be more likely to tell others about your company and bring them in, so customer service then works to improve not only retention but also customer acquisition. Also, this type of advertising is free for the company, so it’s a win-win solution!

Overall, you can see how customer service can boost retention which can improve your bottom line. If you’d like to help increase your customer support efforts, please reach out to us at XACT. We’d love to assist you and your customers!