3.4b Good Customer Service
Technology and Customer Service
Improvements in technology provide greater opportunities to develop customer service.
Social Media, Email, Live Chat
Customer enquires can be addressed via social media, email, and live chat.
Apps and Websites
Orders can be placed and product information, such as FAQs; tutorials; instructions; policies; and support forums, can be accessed 24 hours a day — even when no staff are working!
- Very few staff are needed to provide support for large numbers of customers anywhere in the world
- Customers place orders directly onto the sales system without the need to employ staff to take orders
- Customer support needs are reduced as customers will be able to find answers online before they need to contact the business
- Many services operate 24/7 with minimal staff, which reduces costs
- Cost of system setup and maintenance can be expensive
- May require specialist staff
- Customers who need to speak with staff may find it difficult to do so, reducing satisfaction
Customer Loyalty
Customer loyalty refers to a preference by customers towards a particular business or brand, resulting in repeat purchases; positive word-of-mouth; and makes them less likely to use a competitor instead. It is much easier to sell to an existing customer than to gain a new one.
How can a Business Generate Loyalty?
How can a business generate loyalty from its customers?
- By having outstanding customer service (see 3.4a Good Customer Service)
- Personal service — get to know your customers
- Discounts / special offers for repeat custom
- Loyalty cards (see below)
Loyalty Cards
- Customers are encouraged to participate in a "loyalty scheme" by receiving discounts and other incentives
- The offers increase customer loyalty to the store, incentivising them to shop there rather than elsewhere
- Typically, the customer gains points based on their spending. Points can be exchanged for money-off vouchers or discounted days out
- Since the cost of living crisis, some supermarkets have switched to offering immediate discounts on certain products.
- The best known examples of loyalty card schemes are from supermarkets, such as Tesco's Clubcard and Sainsbury's Nector.
Increasing Sales by Analysing Data
Supermarkets will often talk about how they're trying to help customers. This may be true, but they are more interested in helping their business!
- Loyalty schemes allow stores to collect and analyse shopping habits
- A profile of each customer is produced, allowing the store to predict future spending and target individuals with very specific marketing. Example: if you buy cat food, expect to see offers for pet insurance.
- Loyalty cards, are introduced to increase sales and profits of the retailer by collecting and using data, and increasing customer loyalty
In addition to collecting customer data through loyalty schemes, businesses collect data from:
- Web tracking data — which websites have you looked at? You will see adverts based on their content
- Surge pricing — prices change according to demand, time of day, or how many times you look at a product
- Identifying trends — what products are customers interested in
3.4a Good Customer Service
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