Chapter 10. Customer Service Decisions

Customer service is a set of activities that retailers provide to make the shopping experience more rewarding for customers. These activities not only increase the value the customers receive from the merchandise or services, but also generate positive word-of-mouth communication which attracts new customers.

Goods + Services = Price

Customer service, if used strategically, can provide a competitive advantage to the shop and enhance the retail offering. The extent of customer service to which a retailer provides is determined by:

• The retailer’s objectives

• The type of merchandise

• The customers

A Service Strategy

In Chapter 2, we discussed the importance of customer service. We can conclude that customer service is a process of creating and sustaining customer loyalty. The end objective is to increase customer value and, at the same time, reduce the cost of selling.

Better service does not imply more costly service.

In fact, better service will generate savings as processes are streamlined and as the number of complaints, investigations and rework decrease. Thus many retailers are focusing on customer service as their competitive differentiator.

However, creating and sustaining a corporate culture of service excellence is not easy. Service excellence is more than just smiling employees who make eye contact with their customers. Service excellence is about making, enabling and keeping promises with customers.

In order to achieve consistency and deliver promises through excellent people and practices, a service strategy is required.

A service strategy creates a vision of service excellence for the company.

It helps to clarify service standards to the employees, focus their effort in a common direction, provide a guide for decision-making and build a service culture within the company. It also guides the human resource personnel in hiring the right people.

Developing a service strategy requires the effort and involvement of a team of company leaders and employees. While the managers need to have a clear view of the big picture, the commitment of staff is also important in order for any service initiative to be successful.

Services have to be designed to suit the customers and not the employees. A service strategy should help to differentiate the company from its competitors. Start with a service audit to determine what is important to customers when they visit your retail store. Ask them to envision an ideal retail store. Analyse how your store and your competitors measure up to that standard. Specific standards have to be set for each customer service process, for example, a 24-hour turnaround on customer complaints or inquiries.

Once a service strategy is developed, existing policies, procedures and practices must be aligned to support the implementation of the new strategy. To overcome employee scepticism and foster support, visible service symbols such as a service excellence mission statement, service incentives and measurements must be explained and communicated to all levels of employees.

The Planet Traveller: Travel tips

(courtesy of Kingsmen Creatives Ltd)

Equip employees with the skills to deliver service promises through training and meetings.

A successful service strategy does not end upon implementation. It requires constant monitoring and review. These include assessing employee performance against service standards and rewarding service excellence; comparing your company’s financial performance after the implementation of the service strategy; and benchmarking your services against international best practices. Once you are in control of the system, you should introduce ‘service innovation’ where necessary. Service innovation means to update your service standards in response to market trends or enhance your service offerings to make competitors irrelevant.

Customer Service Programme

A good customer service programme should consider:

• The types of service objectives: A clearly defined set of service objectives that guides the retailer’s efforts on service features and actions

• The features of the service: The types of services provided

• The quality of the service: How the service features are performed

Here are some examples:

Lancome: Waiting area to enhance customer service

(courtesy of Kingsmen Creatives Ltd)

Handling Customers Effectively

Customers have the right to:

• Browse the merchandise at their own pace

• Expect quality and reliability in the merchandise purchased

• Expect accurate and relevant merchandise information to be communicated

• Expect assistance in making a purchase

All sales staff should take note of the following attributes for good customer relations:

• Be courteous

• Be enthusiastic

• Always smile

• Be attentive

• Show concern

• Ask the right questions

• Make an extra effort

• Handle purchases with respect

• Be prepared

• Be well informed

• Be positive in problem solving

• Build customer confidence

Inform your customers of any existing credit card promotions

Handling Inquiries

Customers may make inquiries on a number of issues that may be merchandise-related or service-related. A customer record book can be used to keep track of such inquiries and enable follow-up.

The key points to note are:

• Always answer an inquiry with a smile

• Always be polite

• Stop what you are doing and answer the customers’ queries patiently

• Never reply with statements such as, “I don’t know”, or “It’s all there”.

By answering the customer inquiries in a correct and polite manner, you would have made a good impression on the customer on behalf of the company.

Product Knowledge

Retailers must pick up basic product knowledge to answer customer’s queries. Having up-to-date product knowledge is important to being a successful salesperson as it gives customers confidence in the shop and the assurance that the merchandise is suitable in meeting their needs.

Some basic product knowledge include:

• The uses

• The benefits

• The performance

• The material

• The care

• The appearance

• The background

Brochures on product information

(courtesy of The Executive Home Store – XZQT)

Handling Complaints

All retailers must have standard policies for handling problems. Such policies must be communicated to all employees. If a rectifiable problem is identified, such as a defective product, the retailer should make restitution on the spot and apologise for the inconvenience caused to the customer. The retailer should offer either a replacement, a credit towards future purchase or a cash refund. Minor complaints may be handled by the sales assistants but customers will often appreciate the attention of their superior.

Service Recovery

In cases where the cause of the problem is difficult to identify; is uncorrectable; or is the result of the customer’s unusual request, appropriate steps in effective service recovery may include:

• Listening to the customer

• Providing a fair solution

• Resolving the problem quickly

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I need help...: What are some Simple Actions that make Significant Payoffs?

Customers make a purchase based on what they see (e.g. merchandise, store layout), what they hear (e.g. product knowledge, suggestive selling) and what you focus on (e.g. your promotional efforts).

Great customer service inspires loyalty and provides the means to build your average sales, improve profits and retain customers. However, it requires a 100 percent delivery on your promises.

The following questions and answers should help you and your team turn those demanding customers into loyal advocates for your business.

Q: What do your customers want from you?

Q: What does excellent customer service include?

• Attitude

Attitude refers to the behaviour that shows that you like to help people and do what you should do. Attitudes are contagious. Since you choose to be in retailing, you should do your very best in what you do, be positive and make each moment a special moment for you, your colleagues and your customers.

• Actions

Actions include face-to-face and telephone communications. Especially important is to watch your body language when you engage in face-to-face communication and watch your tone of voice when you engage in a telephone communication.

• Excellence

Excellence means how well you handle the situation when things go wrong and doing what it takes to satisfy customers’ needs without them asking for it.

Q: Dealing with ever demanding customers — Do the old ways work?

Every customer service transaction generally progresses through four steps:

1. Greet (to acknowledge)

2. Listen (to questions and responses)

3. Evaluate (needs)

4. Respond (with an appropriate service)

Each step requires good people skills because you want your customer to walk out of your shop feeling good about the product purchased and service received.

Under normal conditions, customer service requires:

• Good communication skills

• Good understanding of consumer behaviour

• Real desire to provide service to customers

However, difficult conditions are the true test of your customer service skills. Here are some scenarios:

What would you do when:

1. All your customers seem to need your attention at once?

2. Your company makes a mistake and you have an unhappy customer?

3. You encounter an unreasonable customer?

Of course, you should do the best that you can and make the best of a bad situation. Here are some suggestions:

• In an overly busy situation, you should:

– Be fair

– Prioritise

– Give full attention to the customer that you are serving but, at the same time, acknowledge those customers to whom you cannot provide the necessary service immediately

• Handling an unhappy customer requires patience, sensitivity and tact. You should:

– Listen attentively

– Verbalise your understanding of the complaint or problem

– Offer a direct and sincere apology if your company has made a mistake

– Suggest a solution or ask the customer how he would like to see the problem resolved if there is no solution

By acknowledging your customer’s problem and sympathising with him, you have established yourself as someone who wants to help.

• In situations where you encounter an unreasonable customer, you should:

– Maintain poise

– Express regrets for any inconvenience caused

– Stand by your company policy

Do not get angry, do not bring up other issues and do not argue. Seek your superior’s assistance to handle the situation if necessary.

Remember:

• It costs more to get a new customer than it does to keep a current one.

• To apologise is to show that you are sorry for the inconvenience caused and not an admission of guilt.

• Customer service begins with the corporate culture and commitment to providing good customer service.

• Companies that offer a variety of services but lacks good customer service will have a difficult time growing their businesses.

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