Table of Contents<\/strong><\/p>\n <\/a> <\/p>\n This direct connection not only helps retain customers<\/a> but also turns them into advocates for your brand.<\/p>\n I\u2019ve found that by investing in proactive support and personalized experiences, we can turn satisfied customers into loyal promoters who actively contribute to the growth of the business. It\u2019s the essence of what we call the \u2018flywheel<\/a>\u2019 \u2014 a continuous loop where happy customers fuel further growth through referrals<\/a>, testimonials, and repeat business.<\/p>\n <\/a> <\/p>\n A company that prioritizes excellent customer service isn\u2019t just responding to queries or resolving issues. It\u2019s actively driving revenue and boosting profitability. In fact, improving customer experience can increase sales revenue by 2-7% and profitability by 1-2%<\/a>.<\/p>\n Let\u2019s delve deeper into the financial benefits of a top-notch customer service team:<\/p>\n Acquiring a new customer is significantly more expensive than retaining an existing one. According to our research<\/a>, companies that fail to invest even a small percentage of their budget in customer service face higher customer acquisition costs (CAC)<\/a>.<\/p>\n Investing in customer service doesn\u2019t just reduce churn<\/a> \u2014it directly lowers CAC by decreasing the need to constantly replace lost customers.<\/p>\n Every successful startup I\u2019ve worked with over the past decade has prioritized customer service and customer success teams with this goal in mind.<\/p>\n Why is customer retention so important?<\/p>\n Pro tip:<\/strong> Focus on crafting exceptional customer experiences to boost retention. Start with a stellar onboarding process and personalized offers. According to McKinsey, companies with experience-led growth strategies enjoy 5-10% higher wallet share and 20-30% higher customer satisfaction and engagement<\/a> \u2013\u2013 a win-win for both customers and your bottom line.<\/p>\n Another thing I\u2019ve learned over the years is that great service pays off, literally. An extraordinary number of customers are willing to pay a premium for businesses that prioritize exceptional service. Over 80% of customers report<\/a> that receiving value during a service experience makes them more likely to repurchase, even when given the option to switch to a competitor.<\/p>\n Why does customer service make such a difference?<\/p>\n I\u2019ve definitely witnessed this firsthand at Skybound<\/a> with the Insider loyalty program<\/a> and aspects of community management. When you solve for the customer, whether it\u2019s through quick resolutions or thoughtful conversations, they stick around and support you more. Creating communities is a great way to foster this type of relationship.<\/p>\n Pro tip:<\/strong> To deliver the kind of customer service that drives loyalty and revenue, focus on these essentials.<\/p>\n I know you might be thinking this seems like a lot, but it becomes manageable and scalable with an all-in-one customer service solution<\/a>. In my experience, investing in the right tools can really take your capabilities to new heights.<\/p>\n Customer lifetime value<\/a> (CLV) is a really important metric for any business. It measures the total revenue a single customer generates over the entire duration of their relationship with your company.<\/p>\n From my experience, increasing CLV requires a strategic and intentional focus on exceptional customer service. At Dapper Labs<\/a>, for example, we achieved a significant CLV increase by implementing conversational AI chatbots<\/a>. These chatbots managed 70% of incoming support requests (later more), which allowed our human agents to focus on solving complex customer issues and fostering deeper, more meaningful connections.<\/p>\n How does exceptional customer service boost CLV?<\/p>\n Pro Tip:<\/strong> Use customer service research<\/a> and machine learning to predict CLV and inform your marketing strategies. Predictive CLV models, powered by AI, use historical customer behavior patterns to forecast how much value a customer will bring over their journey with your brand. These insights can help identify high-value customers, optimize your acquisition costs<\/a>, and tailor personalized marketing efforts to retain them more effectively.<\/p>\n Business leaders know that profitability isn\u2019t just about budgeting wisely, but it\u2019s also about how customer experience can directly drive revenue. Research shows that companies focusing on CX see twice the revenue growth compared to their peers<\/a>, and this trend has held steady for the past decade.<\/p>\n At Skybound<\/a>, we leaned into this idea during the holiday shopping season on our online store. We set up our customer service team for success by giving them the tools and insights they needed to handle questions and concerns without delay. We made sure they had real-time inventory access and communication strategies to address common issues like order timing and shipping delays.<\/p>\n On top of that, agents took a proactive approach by offering tailored product suggestions that aligned with ongoing promotions \u2013\u2013 helping customers unlock discounts, bundle deals, or free shipping, making the shopping journey seamless and rewarding.<\/p>\n CX is an investment that improves experiences and<\/em> financial performance.<\/p>\n Pro tip:<\/strong> Empower your team with the right tools and proactive strategies during busy periods. Offering personalized promotions and quick, empathetic responses can turn inquiries into lasting customer relationships and sales opportunities.<\/p>\n <\/a> <\/p>\n Customer service team members are on the frontlines, communicating daily with current and potential customers. As a result of this proximity, customer service can offer valuable insight that can help improve marketing outcomes.<\/p>\n Often, how you see your brand privately is different from how your customers see it.<\/p>\n For example, an athletic wear business might market itself as health and fitness-focused, but people might buy from them more for comfort or style. To tailor your message and product strategy, you need to understand these subtleties.<\/p>\n One of the best ways to get this information is to talk to your customer service team. Every day, they talk to customers and find out what works and what doesn\u2019t, as well as why people keep coming back. You can turn these exchanges into useful data by giving them the right tools and training.<\/p>\n We used this approach a lot during important campaigns at Skybound<\/a>. By letting agents record common themes from their interactions, we learned surprising things about why customers purchased, which helped us improve our products and send more targeted marketing messages.<\/p>\n Businesses get more than just happy customers when they put money into knowing and improving the customer journey. In fact, 73% of businesses<\/a> that give their customers an above-average experience do better financially than their competitors.<\/p>\n There is a clear link between putting customer happiness first and long-term growth and profit. It\u2019s not just the right thing to do; it works.<\/p>\n People often think of customer service as an action-based job that deals with issues as they come up. But taking a more proactive method has big advantages.<\/p>\n Businesses that get in touch with customers before<\/em> problems happen show that they want to make their experience better. This not only makes people happier, but it also makes business possible.<\/p>\n Proactive service empowers you to instantly provide customers with the latest goods, features, or solutions they need. Your team can reach out to someone who had a problem in the past to let them know about a new feature that will fix that particular issue. This makes the contact feel personal and up-to-date.<\/p>\n 60% of customers<\/a> say that \u201crepresentatives responding quickly and bringing quick solutions\u201d is the top factor that encourages them to make repeat purchases. Proactive service helps mitigate this by engaging customers early, preventing dissatisfaction, and even turning service interactions into sales opportunities.<\/p>\n Your online conversion rate can improve by 8%<\/a> when you include personalized consumer experiences. A higher conversion rate should lead to more sales and more revenue. Customer service keeps your flywheel<\/a> moving, like marketing and sales.<\/p>\n However, service that isn\u2019t personalized and makes customers feel like no more than a ticket number in the system harms customer retention. Of customers, 62% think businesses can do more<\/a> in terms of personalization because they\u2019d prefer to feel like an experience is all about them.<\/p>\n Data supports that great customer service is an expectation, not a frivilous bonus. You’ll attract new customers, prevent customer churn<\/a>, and build your brand reputation and image with excellent customer service.<\/p>\n <\/a> <\/p>\n Every company is known for its customer service to some degree. Of course, you always want a positive brand image, and customer service can be a significant determining factor.<\/p>\n Your customer service team is often the first point of direct contact between your brand and potential buyers. While marketing campaigns and content build awareness, it\u2019s the customer service experience that truly shapes how customers view your brand and whether they remain loyal.<\/p>\n It also plays a huge role in converting first-time buyers into repeat customers. Research shows that 89% of customers<\/a> are more likely to return after a positive customer service interaction.<\/p>\n In fact, for 66% of customers<\/a>, a brand\u2019s reputation for customer service is a key factor when making a purchasing decision. On the flip side, poor service can cause customers to cut ties with a brand.<\/p>\n It\u2019s proven that investing in a customer service team that aligns with your brand\u2019s values is crucial for long-term success and customer retention.<\/p>\n Poor customer service can cause significant damage to your business, especially as more customers are vocal about their negative experiences. 51% of B2B companies<\/a> will stop doing business with a vendor after a bad customer service experience.<\/p>\n Customers are also quick to leave companies that don\u2019t meet their expectations. Roughly 86% of customers would leave a brand<\/a> after even just two poor experiences.<\/p>\n However, the story isn\u2019t all negative. If your company provides excellent customer service, 78% of customers<\/a> are willing to give you a second chance after a mistake.<\/p>\n Studies have shown over and over that customers are more loyal to companies that fix problems quickly and correctly than to companies that have never had a problem in the first place. This is called the \u201cservice recovery paradox<\/a>,\u201d and it shows how important it is to not only avoid mistakes as much as possible, but also make sure systems are ready for when they do happen.<\/p>\n From what I\u2019ve seen, companies that can turn a bad situation around are the ones that give their employees the tools they need to handle issues with care and speed.<\/p>\n It\u2019s obvious now that outstanding customer service is a significant differentiator. Even in highly competitive markets with equal products and pricing, businesses that focus on customer experience can gain an advantage.<\/p>\n Consider this: if two organizations offer essentially the same product, but one gives great service, which one will you likely choose?<\/p>\n According to research<\/a>, positive interactions increase customer loyalty even in the face of rival offers. Customers will stick with a brand that they trust and feel appreciated by.<\/p>\n In today\u2019s digital age, where word-of-mouth spreads quickly online via reviews, social media, and forums, a great reputation for customer service is essential. It\u2019s become a major driver of new customer acquisition and overall business success.<\/p>\n <\/a> <\/p>\n If a company doesn\u2019t appreciate and properly resource its customer service team, it will show in the quality of service that customers receive. But when companies provide the proper training and work environment, customer service employees become a powerful force to turn satisfied customers into loyal advocates who fuel your business.<\/p>\n It\u2019s simple: happy customer service employees create happy customers \u2014 and the numbers prove it.<\/p>\n Our annual State of Service<\/a> report found that when companies invest in their service teams by providing proper training, tools, and support, it leads to better outcomes for both employees and customers.<\/p>\n Motivated, well-equipped reps deliver quicker, more personalized service, which boosts customer satisfaction. In fact, happy employees can lead to a 13% increase in productivity<\/a>. That kind of boost makes a huge difference in meeting customer expectations, keeping them satisfied, and driving more loyalty. This is true for both B2B and B2C environments.<\/p>\n It\u2019s surprising that so many companies miss this link. In my experience, too many leaders still treat customer service as a cost center instead of recognizing it as a key growth driver.<\/p>\n However, the companies that priortize their teams see real results. Engaged employees are better able to meet the rising demand for fast and efficient service. By investing in your people and the right tools, you\u2019re not only creating a positive work environment but also ensuring happier customers \u2013\u2013 leading to long-term success.<\/p>\n When people have a memorable experience \u2014 good or bad \u2014 it\u2019s natural to want to shout about it from the rooftops. But, of course, today\u2019s rooftops are review websites and social media, with 55% of consumers sharing their purchases<\/a> socially on Facebook, Twitter, Pinterest, and other social sites.<\/p>\n For better or worse, your most impacted customers will do word-of-mouth advertising for you. In fact, 66% of salespeople<\/a> say that the highest quality leads come from existing customers. Since great customer service translates to happy customers, your customer service team can be a major catalyst for cheap promotion through positive word-of-mouth and referrals.<\/p>\n Much like your most loyal customers, referred customers are a business treasure. Referred customers:<\/p>\n Customers who feel genuinely valued are not only more likely to return, but they\u2019ll also actively become your best advocates. A referred customer from a happy one is a trust bridge built on positive experiences, and it\u2019s the kind of growth that\u2019s both organic and sustainable.<\/p>\n As we\u2019ve covered, it\u2018s much cheaper to retain an old customer than to acquire a new one. So, in this sense, the higher a customer\u2019s lifetime value \u2014 the total revenue a company can expect a single customer to generate throughout their relationship with that company \u2014 the higher the profit for your company.<\/p>\n Compared to hundreds of possible competitors with similar products and services, your company has to do more than relish the exciting features of your products. You can differentiate from your competitors by providing stellar customer service. This is especially true when it\u2019s time to launch a new product or service.<\/p>\n Your existing customers are 50% more likely to try a new<\/a> product and spend 31% more money on it than new customers. In fact, new customers are only 5-20% likely to buy a product.<\/p>\n For those existing customers to stay long enough to consider a new product, it takes effort via customer service to keep them satisfied. Of customers, 71%<\/a> cited poor customer service as the reason they ended a relationship with a company.<\/p>\n Conversely, when your company\u2019s customer service is excellent, you\u2019re more likely to see your customers stick around and eventually try more of your offerings.<\/p>\n Loyalty is rooted in trust, and customers can trust real-life humans more than the ideas and values of a brand. So, by interacting with your customer service team, those customers can hopefully build life-long relationships with your business.<\/p>\n <\/a> <\/p>\n Beyond understanding how essential it is to put considerable effort into building a solid customer service team, companies need to provide employees with all the tools they need to deliver the type of consistent, proactive customer service required today.<\/p>\n Here are a few areas to keep in mind when improving your customer service team:<\/p>\n Your team needs to be world-class and ready to meet customer demands at a moment\u2019s notice.<\/p>\n Research shows that 76% of consumers expect connected interactions across all channels<\/a>, but a majority, 54%, feel their experiences are often fragmented across sales, marketing, and service teams. On top of this, 58% of customers say their service expectations have increased since the pandemic. Consumers demand service that is personalized and consistent.<\/p>\n This is where businesses can capitalize on their CX strategy. The gap in customer expectations and actual delivery leaves room for improvement. With competition at an all-time high and customers having endless options, it\u2019s clear that meeting these expectations is no longer a luxury.<\/p>\n In the past decade, businesses gradually explored new, digital ways to engage and support customers. But, over the past few years, this timeline accelerated significantly. As we pointed out, consumers expect service across all channels.<\/p>\n As we shared in our State of Service report<\/a>, only 50% of companies have enabled their service teams with the most basic service features a CRM can provide: a help desk, knowledge base, and shared email capabilities.<\/p>\n As a result, many businesses have much catching up to do to provide their customer service teams with the tools they need to serve customers well across every channel.<\/p>\n Considering this is also one of the highest ROI strategies for CS teams, count omnichannel solutions as a major growth area in the future.<\/p>\n The image below explains how omnichannel experiences work:<\/p>\n Source<\/a><\/em><\/p>\n Rather than having each channel operate independently, the channels link together so they can share messages and information freely. That way, customers don\u2019t have to navigate away from what they\u2019re doing to get help from your business.<\/p>\n Instead, any time they need help, they can reach out on any channel of their choice and will get an immediate, reliable response.<\/p>\n Excellent customer service has always been a major differentiator, and it\u2019s only becoming more crucial. According to a Zendesk report<\/a>, when businesses offer quick, effective, and personalized support, they not only keep their existing customers but also attract new customers from competitors.<\/p>\n![\"\u2192](\"https:\/\/no-cache.hubspot.com\/cta\/default\/53\/9c545446-aacf-47a3-bfb3-1998f78b79c8.png\")
<\/a><\/p>\n\n
Financial Benefits of Excellent Customer Service<\/strong><\/h2>\n
1. Customer retention is cheaper than customer acquisition.<\/strong><\/h3>\n
![\"investing](\"https:\/\/web-stil.info\/wp-content\/uploads\/2025\/02\/importance-of-customer-service-2-20250206-8418593.webp\" "\\"\\"")
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2. Customers will pay more to companies with better customer service.<\/strong><\/h3>\n
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3. Customer service grows customer lifetime value.<\/strong><\/h3>\n
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4. Customer service can lead to more revenue.<\/strong><\/h3>\n
How Customer Service Supports Marketing Success<\/strong><\/h2>\n
1. Customer service employees can offer important insights about customer experiences.<\/strong><\/h3>\n
2. Proactive customer service creates marketing opportunities.<\/strong><\/h3>\n
3. Personalized customer service can improve your online conversion rate.<\/strong><\/h3>\n
Customer Service\u2019s Impact on Brand Image<\/strong><\/h2>\n
1. Customer service affects your brand image and loyalty potential.<\/strong><\/h3>\n
2. Excellent customer service will protect relationships with customers who experience a mistake down the road.<\/strong><\/h3>\n
3. A positive customer service reputation makes people more likely to do business with you.<\/strong><\/h3>\n
The Power of Well-Equipped Employees<\/strong><\/h2>\n
1. Happy customer service employees will create happy customers.<\/strong><\/h3>\n
2. Happy customers will refer others.<\/strong><\/h3>\n
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3. Good customer service encourages customers to remain loyal.<\/strong><\/h3>\n
What Businesses Need to Improve Customer Service<\/strong><\/h2>\n
1. Customers expect high-quality service.<\/strong><\/h3>\n
2. Businesses need omnichannel solutions.<\/strong><\/h3>\n
![\"customer](\"https:\/\/web-stil.info\/wp-content\/uploads\/2025\/02\/importance-of-customer-service-3-20250206-7943243.webp\" "\\"\\"")
<\/p>\n![\"multichannel](\"https:\/\/web-stil.info\/wp-content\/uploads\/2025\/02\/importance-of-customer-service-4-20250206-2331957.webp\" "\\"\\"")
<\/p>\n3. Excellent customer service is a competitive advantage.<\/strong><\/h3>\n
![\"\"](\"https:\/\/track.hubspot.com\/__ptq.gif?a=53&k=14&r=https%3A%2F%2Fblog.hubspot.com%2Fservice%2Fimportance-customer-service&bu=https%253A%252F%252Fblog.hubspot.com%252Fservice&bvt=rss\")
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