Good customer service is not the only factor in customer retention. Customers must have a genuine interest in the product and feel special on an individual level. Bad customer service can destroy loyalty, but treating employees well can lead to customer loyalty.
Building customer retention is a complex process, and there are many different theories on how customer service and customer retention are related. In general, it’s assumed that good customer service translates directly into customer retention, but that’s not the whole story. Particular types of customer service do not instill a sense of loyalty in customers, even if the employees are perfectly polite and professional. It takes even more unique strategies to link customer service and customer retention, and attention to the needs of a customer base is the only way to identify which strategy will be successful.
In most cases, customer loyalty isn’t based solely on customer service. The customer base must have a genuine interest in the product or service being offered and must also have a reason to patronize the business even if that reason is purely social or prestige related. That said, customer service and customer retention are related to the fact that customers are more likely to be loyal to an experience than just the product. Employee-provided service is one of the best ways to create an experience.
Some companies pride themselves on their professional customer service, but professionalism is not the key to retaining customers. Customers need to feel special to the company on an individual level, which is an experience that can only be generated with a certain type of customer service. Friendly, personal customer service that effectively reads customer needs is typically the best way to build customer loyalty, although there are some exceptions to this rule. More generally, making sure that customers’ needs are met on an individual level is the best way to achieve loyalty.
While customer service and customer retention are not always equally related, it is certainly true that where customer service is lacking, customer loyalty will be lost. Bad customer service is bad for businesses in many ways and can destroy customer loyalty. It’s difficult to police all employees to the extent that no customer has ever had a bad experience, but it is possible to create conditions where employees feel they have an interest in providing effective customer service.
An interesting connection between these two concepts is that companies that treat employees in a way that provides good customer service often gain customer loyalty as a plus. In this situation, loyalty is a result of the overall look of the business, not a direct response to the customer experience. Building a good company solves customer service and retention issues.
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