Customer Service Best Practices12 Tips to Help You Attract & Retain Loyal Customers

March 1, 2023 | 15 min read

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Improve Customer Service Best Practices

In a Nutshell

Happy customers are a sign of a great business, but keeping everyone happy is often harder than it sounds. In this post, we’ll take a look at key customer service best practices. We’ll also explore why adopting best practices is so important to your revenue and sustainability and how you can prevent losses due to chargebacks and other risks if you improve customer service.

These Customer Service Best Practices are the Key to Growing Sales & Retaining Revenue

Ensuring that your customers feel heard, supported, and valued is perhaps the most essential task you face as a merchant. But, if that’s the case, then how do so many merchants get it wrong? The way in which you approach customer service could hold the answer. 

The solution is to leverage better management tools, adopt customer-focused principles, and implement customer service best practices. Doing this can help you avoid pitfalls, develop better relationships with customers, and see substantial, long-term revenue gains.

What is Customer Service?

Okay sure, that’s kind of a silly question at first glance. Obviously, everyone knows what “customer service” is in concept. Still, we wanted to dig a little deeper and give a somewhat novel take on the idea.

Customer service is the practice of assistance and care provided to customers. Every business offers different levels of customer care. This care may also be offered before, during, or after a sale. The purpose here is to provide support and ensure customer satisfaction and loyalty, and protect the brand’s reputation.

Customer service is a critical component of the customer experience. One could even argue that it is the most important facet of that experience, considering that 80% of customers expect quick responses from companies. 52% expect the rapid resolution of any problems they might encounter. 

The core of customer service is a set of ethics that customers expect you to adhere to in order to earn and maintain their business. Therefore, “good” customer service should combine human cognition and empathy to create and maintain positive connections with customers and patrons. These ethics should be perceptible in every channel — via social media, your website, and in-person (where applicable). 

The Value of Good Customer Service

Brands pay big money to study the correlation between human behaviors and their shopping habits. They want to know what (if anything) definitively causes humans to lose patience and become frustrated with a product or service, and what companies can do to make them happy. Crucially, they also want to know how to link customer service best practices directly to their revenue.

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It’s pretty simple, to be honest. Word about consistent, excellent customer service gets around. If a customer trusts your brand, they are far more likely to recommend it to others. Potential leads like this can translate to new sales, and will also help you spread brand awareness into previously untapped markets, facilitating exponential growth.

Great customer service touches several areas of your business, including:

Improved Customer Retention

Customer retention loss has increased by 37% since 2016 due to poor customer service. Furthermore, the average American company will lose up to 30% of their customers each year due to a lack of customer loyalty.

Great service can help you avoid losing many of those customers. Not only does that mean an ongoing rapport with a buyer, but it also leaves open that “word of mouth” pipeline mentioned above that can direct new customers your way.

Increased Employee Morale

Let’s face it: being a customer service representative is a hard job. It takes a special sort of person to patiently listen to and assist frustrated customers, and attempt to genuinely resolve their issues. This is why good service shouldn’t just be reserved solely for your customers. Keeping your service reps happy is also an important factor in this equation. 

According to another survey, happy employees are directly linked with satisfied customers. In 2022, companies with high employee engagement scores saw a 12% drop in customer complaints, an increase of 20% in customer retention rates, and an increase of 29% in sales. When morale is high, and employees are engaged and happy, they are more likely to provide excellent customer service.

Better Reputation

As mentioned above, news about good customer service gets around fast… but so does bad customer service. This is why focusing on customer lifetime value (CLV) is another critical component of your strategy. CLV observes the total revenue you can expect from one customer over a period of time. 

You can expect this metric to swing according to the trust that customers have in your brand. If you have a reputation for great customer service, then customer loyalty will lead to more sales and more revenue.

Fewer Chargebacks

Nothing you do is guaranteed to stop chargebacks forever. There’s no “one-size-fits-all” solution. However, one of the best ways to prevent disputes and chargebacks is to make returning items to your business the most attractive option for your customers.

You want your customers to always presume that the fastest way to resolve a consumer issue is to work with you directly. If buyers start to see their bank as the most hassle-free way to get their money back… you’re in trouble.

Good customer service plays a central role in each of the above. You can swiftly identify issues affecting your customers, problems they may be experiencing on your platform and even determine which of your products and services speak most to them. Additionally, customers that feel their concerns will be prioritized and that they’ll be able to return items without a fuss will likely return to your brand again. 

Essential Principles of Customer Service 

Remember: good customer service is about building and maintaining relationships with your customers.

To encourage and foster great relationships, you will need to ensure that your customer service response is optimized. This means acting quickly, maintaining easy access to documentation, and investing in 24/7 support.

Adopting individual customer service best practices will be fundamental for success. Let’s look a bit deeper for a moment, though, and examine the core principles that should guide your customer service approach:

Empathy

Emotional intelligence plays a starring role in any customer service situation. Your customers are not just unknowable strangers on the other end of a transaction. They’re human beings with unique challenges, concerns, and schedules.

Putting forth the effort to empathize with buyers, and to clearly convey that empathic response, is crucial. Your support staff should be understanding, helpful, patient, and above all, genuine. Customers can tell when you’re being phony, and fake empathy is just as bad as a lack of empathy.

This might seem obvious, but plenty of companies really drop the ball in this department. Don’t be one of them.

Genuinely Valuing Feedback

Firsthand feedback is your “ace in the hole” when it comes to customer service.

Your customer service team should have access to feedback collection tools to identify and analyze the specific needs of your customers. Surveys, interviews, and targeted case studies can help you determine what your customers want most, as well as help identify any products or services that are failing to meet their needs.

Soliciting feedback It gives your customers the means to communicate their impressions. Actually learning from those insights can help you satisfy more customers and avoid refunds and disputes.

Consistency

In our increasingly digitized culture, customers have become quite used to immediacy. While problems and questions might show up spontaneously, your response to addressing those issues needs to be rock solid.

If you don’t have a 24-hour support feature for your business, you’re missing out on opportunities to meet and exceed customer expectations. You’re also inviting customers to resolve issues with their bank, rather than with you. Banking apps offer 24/7 dispute resolution portals, and they’re happy to meet customers’ needs when you’re unavailable. 

Even when round-the-clock live service is not possible, you still have options. Help desk tools, customer service chatbots, and other services all exist to provide at least some response to customers at all hours.

Emotional Intelligence

Emotional intelligence is the ability to read and react to another person’s emotions. This is related to empathy but is distinct in certain regards.

With emotional intelligence, you’re doing more than just attempting to relate to the individual. Here, you’re using those empathic insights to try and understand what the other person needs, and how best to meet those needs and provide a satisfying solution.

It can be hard to handle customers, especially when they’re upset or angry. However, emotional intelligence is crucial to help de-escalate situations, and preserve relationships with customers. Being able to “read” other individuals, and identify their needs, is a crucial principle. 

Creativity

Creativity isn’t limited just to art class. Thinking outside the box and coming up with creative solutions to customer service problems is at the heart of better customer relationships.

How are your improv skills? Deploying creative solutions for customer service demands the ability to think on one’s feet. You also need to be willing to grant a bit of leeway for representatives to do what is necessary to keep customers happy.

When it comes to customer service, you want to reward creative problem solving, rather than trying to constrain it.

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The Top 12 Customer Service Best Practices

Now that we have a better understanding of the basic principles of customer service, let’s discuss how those principles can be deployed in practice.

Improving customer service procedures will increase loyalty, build relationships, and prevent loss. There are dozens of ways to do this. Some customer service best practices are obvious, but many represent more subtle standards.

We ran through some tips to help improve customer service in another recent article. Here, though, we'll offer twelve customer service best practices to help you elevate your customer experience above and beyond your shoppers’ expectations:

#1 | Show Appreciation to Your Current Customers

Discounts and other incentives are a great way to entice new shoppers. What about your existing customers, though? Shouldn’t you reward their loyalty in the same way? A bonus for return buyers such as a discount code, or even free shipping, is a great way to say “thank you” to customers for their support.

#2 | Personalize the Experience

Shoppers want good customer service, and they want it tailored to their specific needs. Encourage your service representatives to leverage customers’ names and their history with the business. You can use customer relationship management (CRM) software to accomplish this. If a customer contacts you, encourage representatives to call the customer by name throughout the conversation and be proactive in appealing to that customer’s preferences.

#3 | Provide Omnichannel Support

With the rise of eCommerce, customers have become accustomed to omnichannel, round-the-clock shopping. Shouldn’t they have the same access to customer service? Find a way to be available 24/7 across multiple contact channels (phone, email, and social media). Connect with customers on social platforms. Finally, replace your automated phone directory with real people for customers to interact with, and try to answer all calls within three rings.

#4 | Simplify Customer Processes

You can simplify the customer experience by reducing the number of steps in your checkout process. For instance, you can auto-populate fields during checkout, which will discourage card abandonment. Look for unique ways to streamline your operating procedures and encourage order completion. For instance, consider providing quick and easy reordering, offering “no-questions-asked” returns, and providing free return shipping.

#5 | Hire the Best People

Make sure your customer service staff are as courteous, patient, and professional as possible. They should have inside-and-out knowledge of your company, your products, and your services. Some customers will be angry when they call, while others may just want to voice their concerns. Representatives must be able to adapt to the customer’s needs and respond appropriately.

#6 | Respect Your Customer Service Reps

Some customers may call your customer service department with praise. It can happen. However, the vast majority of people who contact customer service will do so with a complaint. That means your reps often have the thankless job of getting yelled at by disgruntled and unsatisfied customers. Make sure you compensate your agents competitively, let them know they are appreciated, and reward them for exemplary service.

#7 | Be Transparent

Your customer service reps should strive for honesty and transparency on every call. If they can’t answer a query, they should say so, then promise to find an answer as quickly as possible. If an error was made on your end, own up to it, then find a way to remedy the issue. Encourage your people to put themselves in the customer’s position. How would they feel in the given situation?

#8 | Take the Customer’s Side

Always start with the assumption that the customer has a legitimate concern. That won’t always be the case, of course. However, your service representatives should side with the customer until all the evidence is in. Even if the customer is in error, they should be treated respectfully.

#9 | Improve Constantly

Look for opportunities to improve your customer service even more. Regularly review your business’s policies and practices. Take customer suggestions seriously. Keep an ongoing list of processes that you feel could be improved, then ask employees for input on how it could be done. This will give your team members a sense of ownership and investment. It can also give you insight into issues that may not be immediately visible.

#10 | Make Self-Service an Option

In line with the 24/7 support mentioned above, it is always a good idea to provide customers with the tools they need to resolve problems on their own when possible. Investing in a knowledge base (a categorized list of support articles and FAQs for common issues) can help customers address common problems before a support ticket is ever processed.

#11 | Remember the “Human Element”

All this new technology can help you remain available to your customers at all hours. However, you still need to make sure a human being is easily accessible to ensure the customer has everything they need. At the end of the day, your customers and employees should be connecting with one another to ensure a positive, mutually beneficial customer experience is possible.

#12 | Always Follow Up

As far as possible, every contact with a customer (sales, shipping, returns, complaints, etc.) should be followed by a call or email to ensure the shopper is happy. This kind of follow-up is the only way to be certain that expectations were met to the customer’s satisfaction.

Avoiding Potential Pitfalls by Adopting Customer Service Best Practices

Adhering to these customer service best practices and principles will save you a lot of headaches down the road.

Happy customers will return to do business with you again and again. Displeased customers, however, will leave negative reviews, and share their complaints publicly on social media. Not only that, but as we mentioned above, dissatisfied customers are likely to file disputes and chargebacks.

It’s hard to place a dollar value on great customer service, but showing the impact of chargebacks is easy. According to the 2021 LexisNexis True Cost of Fraud™ study, retail and eCommerce merchants ultimately pay $3.60 for every dollar lost in a fraud attack. This includes friendly fraud, which is directly impacted by your adoption of customer service best practices.

That’s an intimidating statistic. The more you work to enhance the customer experience, though, the more comfortable shoppers will feel when dealing with you.

Consumers need to know that they will talk to a courteous, professional, and knowledgeable agent if they call you. They should be confident that the person on the line will work to resolve their issue as painlessly as possible. That keeps the customer happy — and more willing to shop with you again.

Of course, providing a better customer experience is not, on its own, a complete chargeback prevention strategy. Multiple other factors can trigger customer disputes, from merchant errors to friendly fraud. Fortunately, we can help.Chargebacks911® offers a true end-to-end technology platform that prevents more disputes, wins more reversals, and maximizes your ROI. For more information on how to improve customer service to prevent chargebacks, contact us today.

FAQs

What are customer service best practices?

Customer service best practices cover a wide range of rules and procedures you can adopt to improve customer service. These include personalizing experiences, being transparent, respecting your customer service team, and rapid response, just to name a few.

My customer service is already good. Why do I need to improve it?

Today’s shoppers expect more. They demand quick responses, easy contact, and personalized service. Remember: if you’re not offering the highest levels of customer care, customers will be quick to switch to a competitor who does.

Is there a simple way to improve customer service?

Anything that streamlines the customer experience is good. Go over your policies and procedures from the shopper’s viewpoint: are there trouble spots that you could remedy? Are there more options you can offer? Look for things you can do to make the customer experience easier, faster, and more enjoyable.

How can mediocre customer service lead to chargebacks?

Consumers have discovered that filing a dispute with the bank is often a pain-free way of obtaining a refund. If your customer service department is hard to work with, or your return policies are a hassle, customers are that much more likely to turn to the bank at the first sign of a problem.

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