Wednesday, July 29, 2009

Investing in Customer Service

According to this article, "The American Customer Satisfaction Index, a widely followed survey conducted by the University of Michigan, is at a record high. Other surveys also report gains in customer satisfaction." What's interesting about these results? According to the research cited in the article, service often suffers during economic downturns. This year, however, we see firms taking care to retain loyal customers, and trying to improve service. It's good news for customers, who were taken for granted by some firms during boom times.

What does this all mean for companies moving forward? It's so important to understand two sets of customers. The first are those buyers who are likely to defect if not served properly. Does your firm understand which customers, who are profitable for your firm, are also in danger of defecting to the competition? Secondly, your firm has to ask itself: Which consumers are most likely to increase their spending substantially when the economy begins to pick up steam? You want to take good care of them now, so that they demonstrate loyalty to your firm when they begin spending again. In some cases, those buyers may be keeping their wallets mostly closed now, but there may be indicators that they could be profitable customers for you down the road.

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