Service Without a Smile Can Be Deadly
When a salesclerk ignores you or refuses to accept a return of merchandise, how many people do you tell?
Customer service experts say the average unhappy customer complains to about half a dozen friends, neighbors and colleagues about poor service. Imagine the impact that 10 unhappy customers could have on your earnings.
“For a small business that can’t afford other kinds of promotion, word of mouth is a life and death factor,” said William Davidow, co-author of “Total Customer Service,” published by Harper & Row.
Davidow, a Menlo Park, Calif., venture capitalist, said small-business owners should ask their best customers to describe exactly what kind of service they expect. Then ask the customers if they recommend your firm to others. And, if not, why not?
In recent years, too many companies have focused on profit and competition, leaving customers to fend for themselves. But American consumers, impressed by the high quality and good service provided by many Japanese and European companies, are demanding better service today.
Even such giants as IBM are paying heed: To provide greater convenience for his rural customers, an IBM sales representative in North Carolina created a portable showroom--the “Solution Mobile”--by filling a mobile home with computer equipment and visiting customers at their homes and businesses.
But no matter what size your business is, you should take a close look at how you treat customers and clients.
“Customer service expectations have to be set by the top management of a company,” said Ellen Forman, president of Courtesy Counts. Her Potomac, Md., company reports on employee performance and attitude by sending representatives to visit stores across the country.
Forman, who founded the company 10 years ago, said the message from the business owner has to be loud, clear and consistent.
“The president might say, ‘Customer service is the most important thing for us, so do it,’ ” said Forman. “But the next person down the line might say, ‘Count the inventory’ and the next, ‘Clean up the store.’ ”
Elaine Locksley, founder of the Locksley Group in Pacific Palisades, said customer service gives companies a measurable edge over the competition. Locksley sends shoppers into large and small businesses to monitor their service and provide customer service training programs, if necessary.
Locksley developed her customer service techniques while working for 20 years in the savings and loan industry. After hiring mystery shoppers of all ages to visit stores, banks and other businesses, she presents the owners with a detailed report. She says she expects the information to be shared with employees.
Kay Hollenbeck, a “mystery shopper” and manager at the Locksley Group, said one of the fastest ways to lose business is for a salesclerk to be talking on the telephone, see a customer standing there and then turn his or her back on the customer. Another sure turnoff is for a salesperson to start helping a customer and then get distracted and never return.
Even the best training programs and promises of cash rewards won’t be effective unless your employees feel a sense of ownership and pride in the business, according to Locksley. Everyone who works for you should be given the power to make decisions needed to please your customers.
“We were concerned that even with all the thousands of dollars spent on our training program, when the boss is gone, the standards drop,” said Jack Ryan, whose parents Bob and Jean Ryan opened their first women’s apparel store in 1954. Today, there are three Jean Ryan stores employing about 30 full- and part-time workers in Orange County.
“We are living in a service-oriented society,” said Ryan. “With too many competitors you have to offer better service.”
Locksley’s shoppers visit Ryan’s stores at different times of the day and week. Frequently, they make a purchase or return an item.
“We try to use her service as a positive tool,” said Ryan. He said if an employee is presented with a negative report, they usually attribute it to being too busy with other customers.
John Irving, senior vice president at Premier Bank in Northridge, pays about $450 a month for Locksley’s services. For that fee, Locksley reports on three visits and three phone calls to Premier’s three bank branches. Irving said it is money well spent because “an outside opinion has a tremendous value.”
Once you figure out what customers expect and where you are falling short, quickly establish ways to improve your service. But Davidow said written policies and programs won’t work if you don’t have the infrastructure in place to help your employees. For example, having legions of employees trained to answer the phone properly won’t matter if you don’t have enough phone lines to serve customers.
If you can’t afford to pay professional shoppers to monitor the service you provide, ask a few friends or relatives who are not known to your employees to check on the service. Knowing what goes on when you are not around is vital to the success of your business. Especially since customer service experts estimate that it costs about 10 times more to bring in one new customer than to keep an old one.
New Incorporations Fell 4% in Last Half
Small businesses dramatically outperformed large companies in sales and employment growth during the last half of 1989, but new incorporations dropped 4%, according to the American Express small-business growth index. The semi-annual survey measures the employment and sales growth of about five million businesses with up to 100 employees.
Barbara Barsa, vice president of small-business services at American Express, said the drop in new incorporations signals a slowdown in the economy.
IMPROVING CUSTOMER SERVICE
Ask your best customers to honestly tell you what kind of service they expect from your company.
Establish clear and simple service policies to match customers’ expectations.
Give authority to people at every level so they feel empowered to provide good service.
Eliminate all red tape involved in merchandise returns.
Set clear customer service goals for your employees and make sure that everyone understands them.
Provide specific training and information so employees know exactly what to do in every situation.
Make employees accountable for their actions.
Write specific job descriptions for every employee and offer incentives for promotion so people don’t feel stuck in a dead-end job.
Publicly reward and recognize good service.
If you can’t hire an outside firm, ask your friends or neighbors to visit your business and report on the service they received.
