MaRS Library Customer service excellence: How startups can deliver more value for customers
Customer service excellence is a key element of customer satisfaction and can help you deliver more value for customers. Delivering customer service excellence can help you differentiate your brand and product and help you build your startup’s reputation by generating positive word-of-mouth marketing. It is your customers, after all, who determine your value.
How to deliver more value for customers
To deliver customer service excellence, you may need to adjust your schedule and resources to meet your customers’ needs. It needs to happen on the customer’s schedule, not yours.
You also may need to adapt your lean startup methodologies to anticipate customer needs (for example, you may need to stock some extra inventory, so that you have what the customer needs when they need it). While the process of delivering customer service excellence can feel inefficient in terms of lean principles, the goal is to increase your value in your customer’s mind.
Example: Delivering customer service excellence
Isadore Sharp, founder and CEO of the Four Seasons chain of hotels, built his global brand on delivering customer service excellence and used this feature to differentiate his product. To achieve this level of customer service, Sharp tells of empowering staff to go off-script and do whatever it took to solve customer problems. He cites examples of staff arranging for a last-minute tuxedo by borrowing one from a hotel employee, and squeezing in an unexpected table for Bill and Hillary Clinton at a crowded brunch. Sharp relates that daily staff meetings take place at every Four Seasons to discuss “glitches” that did or could arise and to focus on ensuring that every guest has a positive experience.
Meeting customer expectations
In order to deliver more value for customers, it’s important to know that across different markets, customers tend to have common expectations:
- Customers want help right away when a problem arises and when it is convenient for them—often over the phone, but increasingly through multi-channel self-service options
- Customers want to resolve their problem with a minimum of hassle (i.e., they want an efficient process and to speak to someone who is polite and knowledgeable). Experience has shown that it is better for overall customer satisfaction if your customer service representatives are rewarded for problems solved—rather than the number of calls handled
- Even if a problem cannot be resolved over the phone, customers will forgive a lot if your representative is respectful, knowledgeable, friendly, sympathetic and patient. Oftentimes the fact that a problem has arisen does not have to be a crisis, as long as it can be fixed and the customer has a positive experience
When customer service excellence falls short
When your customer service excellence falls short, it creates a negative customer experience that can harm your reputation. In this case, word-of-mouth marketing can work against you.
A 2013 study by market research firm Harris Interactive showed that 85% of customers whose service needs are not met will retaliate against the company. Of consumers aged 18 to 34, 21% will use social media to do so, with that percentage likely to rise as social media becomes more popular in different demographics.
Why customer service excellence matters for startups
Regard your customer service channels as a listening device to find out what customers are saying about your product. This will help you understand how well the product is working (or not), how your customers are using it and what they want from it. As a startup, you need to be cautious and ensure that you deliver value to customers from the start and that customers are comfortable with your product.
Have a blend of expertise serving in the customer service role, with both managers and developers taking part. Ensure each team members is trained to deliver the level of service you expect.
Selling to businesses
Recognize that having customer service support available can be a critical factor in landing business customers. Some business customers will not buy unless this is available to their users.
Customer service support can help increase sales for online businesses. Entrepreneur and author Dave McClure describes five “pirate metrics” (named for their acronym: AARRR) that digital marketers should use. These metrics are listed in the order in which they take place:
- Acquisition: The number of users who respond to your digital marketing by visiting your website
- Activation: The number of users who have a positive experience on their first visit to your website
- Retention: The number of users who return to your website after the first visit
- Revenue: The number of users who become customers by taking an action that results in revenue
- Referral: The number of users who recommend your startup to others (that is, who have a positive enough experience to do so)
A critical gap occurs between “Activation” and “Retention.” Customer retention can be difficult attain, yet it is essential. Customer service excellence can help you and your customers bridge this gap. For example, your team can support first-time users by sending automated tips to first-time users or an inquiry to see how they are faring with the new product. This can help not only help resolve problems but also prompt new users to get to know your product. Implementing such triggers can help move customers from Activation to Retention, and help you deliver more value for customers.
Capture key metrics in order to deliver more value to customers
Use what your customer service team hears to understand more about your product and how you can improve your customers’ experience. Capture data and metrics on:
- What problems arise
- What time these problems arise and when customers tend to call
- How long it takes to resolve the problem
- What kinds of stories/language/tone your team encounters and the areas where customers tend to be stuck
- What patterns may be occurring
Trends in customer service
Technology startups are well positioned to leverage trends in customer service. To deliver more value for customers, ensure your strategy includes:
- Providing multi-channel support to customers, 24 hours day, seven days a week
- Building self-service solutions
- Connecting your self-service solutions to your system that manages social media posts, in order to respond to and resolve customer problems even more efficiently
- Using text messages (in moderation) to efficiently communicate with your customer
Customer service excellence: Additional resources
- Excellence in customer service: The forgotten marketing strategy — MaRS Best Practices
- Delivering excellent customer service: Five Hot Tips for Startups
- Customer experience: A key ingredient for a growing customer base
Customer service excellence and stages of venture development
The Startup Genome model defines five stages of venture development:
This article relates to startups in the validation stage once they achieve traction and customers.
Gallo, C. (2013, May 9). Seven Customer Service Lessons I Learned In One Day With Richard Branson [Video]. Forbes. Retrieved from http://www.forbes.com/sites/carminegallo/2013/05/09/seven-customer-service-lessons-i-learned-in-one-day-with-richard-branson-video/
Grant, R. (2013, November 14). 85% of consumers will retaliate against a company with bad customer service (report). VentureBeat. Retrieved from http://venturebeat.com/2013/11/14/85-of-consumers-will-retaliate-against-a-company-with-bad-customer-service-report/
McClure, D. (2007, August 8). Startup Metrics for Pirates: AARRR!!! Retrieved from http://www.slideshare.net/dmc500hats/startup-metrics-for-pirates-long-version
Sharp, I. (2009). Four Seasons: The Story of a Business Philosophy. Toronto: Penguin Group (Canada).
Solomon, M. (2014, May 27). There’s Nothing Less Efficient Than Providing Great Customer Service. Forbes. Retrieved from http://www.forbes.com/sites/micahsolomon/2014/05/27/theres-nothing-less-efficient-than-providing-great-customer-service/
Vilner, Y. (2015, January 21). Here’s How Customer-Service is Going To Explode in 2015. Inc. Retrieved from http://www.inc.com/yoav-vilner/here-s-how-customer-service-is-going-to-explode-in-2015.html?cid=readmore
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