Outline why customer satisfaction is crucial to the success of a business organisation.

Customer service refers to the way an organisation interacts with its customers eg when a customer is making an enquiry or a purchase, when making a delivery to a customer or handling a complaint from a customer after the sale has taken place.

Maximising Customer Service/Satisfaction 

Later in the course you will learn how Marketing, Operations and Human Resources departments can contribute directly or indirectly to improving customer service, but a short summary now follows.

• By using market research to get customer feedback on their experience, the marketing department can make decisions on improvements to product specifications, prices and where they sell their products to ensure customer satisfaction.
• If the human resources department provides staff with training, they will be able to handle queries and complaints from customers, resulting in a better customer experience.

• Examples of good customer service include staff answering the phone promptly; having good knowledge of products; having a polite manner when dealing with customers.
• By carrying out quality assurance the operations department can ensure that products offered to consumers are of a high standard, thus increasing customer satisfaction.

Measuring Customer Satisfaction/Service

• Customers may be issued a questionnaire and invited to comment on the standard of customer service they have received.
• A follow up phone call or visit made soon after the sale has been made, to see if the customer is satisfied with the service they received.
• Organisations may review information contained in customer complaints and monitor quantities of returned products.
• Organisations may look at trends in sales to see if they are increasing or decreasing, drawing conclusions about customer satisfaction levels.
• Organisations can monitor reviews of their products and services that customers have posted on websites. These reviews may contain details of what customers like and do not like.

Importance of Good Customer Service

• A customer who is not dealt with efficiently when making an enquiry may lose confidence and go to a competitor.
• If a competitor then offers a better service, it is unlikely customers will return to the first business, so futures sales and profits will be lost.
• Customers who experience poor service during and after making their purchase will be unlikely to return and may give the business a bad name by sharing information with other potential customers.
• Customers who experience good service will continue to buy in the future and may recommend the business to others, enabling the business to increase its market share.
• Loyal customers leads to increased sales volumes and profits, and can contribute to the reputation of the business in the eyes of the public.