How Smart Retailers Are Using Customer Service to Drive Loyalty
When retailers focus on customer service, they often consider how they can improve service to make the sale. After all, first impressions count for a lot.
If prospects are happy with how they’re treated at the outset, they’re much more likely to have positive feelings about your brand.
But what about service you’re providing to existing customers? It’s been proven time and again that it’s far more expensive to acquire a new customer than to keep an existing one. And that’s smart for business, when a 5 percent increase in customer retention can improve a company’s profitability by 75 percent.
Retailers should always focus on service for new customers, but it’s also important to focus on the customer experience post-purchase. Some of the savviest retailers are already using customer service to drive loyalty — here’s how they do it.
What happens after a purchase is made?
When a customer makes a purchase, you might think all is well. But after someone enters their credit card number and hits enter, things can potentially go downhill fast.
If there are problems with the experience — a confirmation email isn’t sent, shipping is delayed, or incorrect items are displayed in the receipt — customers will quickly doubt the level of service and perhaps even the competency of your company. If customers find themselves struggling to get answers, they’ll no longer feel positive about the brand, and they’re not likely to come back to make another purchase.
That’s why providing great service after a purchase is so important: It increases the chances of gaining a loyal customer. Even if there is a problem, you can still maintain customer loyalty if you answer their questions quickly and thoughtfully.
How to use customer service to drive loyalty
1. Make it effortless
Imagine you just purchased a pair of shoes for an upcoming event, only to realize that you accidentally shipped it it to your mother’s address. When you contact the company minutes after you make the mistake, you can’t reach anyone. You try live chat, calling the customer service line, and sending an email, but you just can’t get through.
When this happens, panic often sets in. Your excitement about the shoes has morphed into anxiety, and you have to jump through numerous hoops to fix the problem.
When customers have to put in a ton of effort to resolve issues, it negatively impacts loyalty.
The CEB completed a study of more than 75,000 consumers and found that the number one driver of customer loyalty was a low-effort experience.
In the report The State of Post-Purchase Experience from Narvar, 70 percent of consumers say an easy return or exchange is likely to make them a repeat customer.
2. Equip your team with the right tools
Those of us who work in customer support have good intentions. We want to provide the best service possible, no matter the situation.
But there’s a disconnect between the service we think we’re providing and the service we’re actually providing — it turns out that 80 percent of companies say they deliver superior customer service, while only 8 percent of people think these same companies deliver it.
You need the right tools to provide a better experience. When a customer calls, they shouldn’t have to give tons of information to resolve their issue. The right CRM, such as Salesforce, can instantly connect a customer’s phone number with their most recent purchases.
You can also use tools that allow your customers to be in the driver’s seat. For example, BigCommerce and AfterShip provide software that allow customers to track their own orders, reschedule deliveries, and request returns and exchanges on their own.
Customers not only want transparency, they demand it after they hit the buy button. Narvar is changing the post-purchase game by allowing retailers to send powerful order confirmation messages that contain all the information a customer would need and more. The company reports that these emails have a click-through rate three times than standard marketing emails, SMS opt-in rates are 5.5 times higher than before they buy, and CSAT jumps 18 percent higher with these proactive notifications.
Tools like GetFeedback also enable you to measure customer satisfaction to gain valuable insights about your customer experience and take action.
3. Find creative ways to deliver relevant content
When customers shop with any retailer, they expect to receive notifications straight to their inbox. When asked how they want to be communicated to about an item they purchased online, 94 percent said email. Email is the perfect place to communicate with customers, and many retailers do an excellent job of finding creative ways to build loyalty through every step of the experience.
For example, beauty retailer Sephora has some of the most compelling email campaigns around. After customers make a purchase, they receive consistent updates about order status.
But Sephora also uses customer status for particular promotions. Once a customer has reached VIP status, Sephora will automatically send them exclusive offers. Sephora also sets up rules that will send the customer a more targeted offer based on how much the customer spends. If the customer spends more than $200, they get an email with access to the special VIP discount.
Clothing retailer Boden wanted to create an email re-engagement campaign targeted at high-value customers who hadn’t purchased in a while. Using their customers’ purchase data, they created a unique story for each recipient that motivated them to continue their relationship with the brand. This can be accomplished using features like dynamic content available through your email service provider.
4. Use NPS to measure sentiment, and act on it
You work at a company that you love, and it’s easy to think your customers love you as well. The truth is, your customers don’t love you as much as you do. Most customers will think you’re fine — they might like your products but aren’t jumping over the moon with excitement over you.
Net Promoter Score (NPS) is a helpful tool for understanding how customers feel about you. It separates customers into three categories: promoters, passives, and detractors. As you seek to deliver better service, you can reach out to passives and detractors to better understand and address their feedback and move them to promoters with time and a bit of effort.
5. Drill into data to deliver stellar service
When customers feel known, they are more likely to make repeat purchases. Smart retailers drill deep into customer data to understand trends, as well as what products appeal to particular customers. As a retailer, you should ask yourself:
- What products have particular customers bought before?
- What do we know about customers who buy these products?
- When customers buy certain products, what other products do customers also buy?
- How often do our most loyal customers make a repeat purchase?
You can use this information to promote relevant products, provide valuable content, and deliver the right information at the right time to customers. Through automated, personalized emails, you can build a connection and increase loyalty. Driving customer loyalty
Customer service should be an integral part of the entire customer journey, no matter how long ago a customer made a purchase.
Customer loyalty can spell out big wins for your business. When customers come back over and over again, they not only make purchases, but they tell their friends and family about how happy they are with your products, and that word of mouth is priceless.
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