BEST PRACTICES/CUSTOMER DEFECTIONS
GOOD SERVICE TRAINING WILL
AVOID CUSTOMER DEFECTIONS
BEST PRACTICES
There are memories and distinct memories — those that will
never leave you and will follow you to the grave.
I recall an occasion when I went shopping with my family to
buy clothes for my kids. My wife and I selected clothes from a
reputable, name brand store that was in an outlet mall. The line
was not too long and as I waited to pay, I noticed that the cashier,
a young man, greeted patrons and asked them how their day was
going and indulged them in small talk. I thought that was very
nice of him to engage customers and make them comfortable.
Then I noticed something unique, his candor was not the same
toward all patrons. He was gruff and ignominious to others. I was
puzzled and waited for my turn to see his reaction. No pleasant
greeting or small talk awaited me. I received a very rude “here you
go” while handing over the bag of clothes.
Now my curiosity was awakened more and I wanted to see how
the next customer was received. To my surprise, the next customer
was received with welcoming arms.
So that started the quest for this unique behavior and the
researcher in me wanted to dig into this conundrum. I told my
wife to keep shopping while I lingered for a while, paying extra
attention to the cashier’s behavior.
A peculiar pattern arose; customers who bought all items
from the clearance section were treated poorly compared with
customers who bought items at full price. This was a classic example
of service breakdown. This cashier seemed to believe that
customers who purchased items from the clearance section were
somehow inferior.
BUSINESSES MUST TRAIN EMPLOYEES
IN CUSTOMER SERVICE. IT IS BETTER TO
ACQUIRE AND HOLD ON TO CUSTOMERS
THAN ENGAGE IN RECOVERY EFFORTS
THAT TAKE TIME, EFFORT AND MONEY.
FRONTLINE EMPLOYEES ARE THE FIRST
POINT OF CONTACT WITH THE CUSTOMER
AND SHOULD BE TRAINED TO HANDLE
CUSTOMER EXPECTATIONS, ESPECIALLY
WHEN IT COMES TO SERVICE.
I felt violated and upset and decided not to patronize this brand
as my purchase decision was frowned upon as inferior. I decided
that defecting to another brand that respected my purchase
decision was the next viable step. Every time I shop around my
purchasing pattern has changed — I do not buy clearance only.
Prashanth Pilly began his business career
working in the exporting business in India
and Australia, and served as a marketing
executive for two of India’s largest manufacturers.
After moving to the United States, he
founded a small business, operating it for
years. He began his teaching career as an adjunct
professor at Indian River State College,
earning his doctorate degree in business administration
with a marketing specialization.
Pilly, who is dean of IRSC’s School of Business,
is a visiting professor at the Czech University
of Life Science in Prague, Czech Republic. He is
also a member of the International Business
Student Exchange Network, a coalition of 10
international public and private universities.
PRASHANTH PILLY
Research indicates that higher customer service leads to improved
financial performance of a business. Unfortunately,
businesses or their employees tend to impose their personal
needs onto others. We live in a different world, where the customer
is well-informed, well-researched, highly opinionated and
thinks differently.
So why do customers defect?
Customer defection happens mainly due to price, inferior service,
the customer’s need not being fulfilled and poor resolution
of customer grievance. Many businesses that have had customers
defect, such as AT&T, Sprint or Travelocity, have implemented
win-back offers to overcome customer defection.
One must be careful not to cast a large net, as not all businesses
have resources and manpower to entertain and win back every
defected customer and furthermore there is no guarantee that
after the win-back the customer will not defect again.
Customer win-backs happen if customers defect because
of a price issue. The success of win-backs is also more profound
after the first defection, especially if the customer was not dissatisfied
when they first defected and when the business shows
sincere effort to correct the error.
Win-back offers that give price discount or service upgrades are
found to be the most successful in recovering defected customers.
It must be noted that the lifetime of these recovered customers
may vary and it is harder to keep customers who have had
service issues over prices as trust plays a critical role.
Businesses must train employees in customer service. It is better
to acquire and hold on to customers than engage in recovery
efforts that take time, effort and money. Frontline employees are
the first point of contact with the customer and should be trained
to handle customer expectations, especially when it comes to
service. Service-related issues are difficult to repair; therefore, prevention
is better than a cure.
The company, if it had trained its cashier to provide the same
level of service to every customer irrelevant of the customer’s
purchase decision, would have kept me as a customer for a longer
time. The trust should not have been broken the first time.
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/TCBusiness.com