Wednesday, 12 December 2007

Customer service, worth it or not?

My philosophy in business has always been that every business is a sales company - with out a sales function you have a hobby because you won't have any customers to trade with.

It's a simple idea and true in every case, whether it's a venture capital business (they sell idea's and business to investors) to accounting firms - even partial government agencies like NATA are sales companies who effectively sell compliance's.

It's so smart I must have come up with - that along with the fact that I don't recall anyone telling me it and until I have proof otherwise it's my little gem.

Knowing that fact it becomes easier to comprehend that we are all fighting for the same dollar one way or another - it's a bit like the economic theories regarding competitive product, and complimentary products when looking at supply and demand.

As a provider or SMS, we fight against the likes of business grade email services, LAN lines, Blackberries, etc... We also fight against staff costs, petrol prices and inflation - mainly because companies in Australia haven't yet realised that SMS is a legitimate mode of communication not only within the business dealing with internal customers, but externally to well external customers like you and me.

Company X only has a certain amount of financial resources and need to use those resources the most effective way as possible in order to continue their business hopefully with the intent on growing it - this is why customer service is so crucial to small business as it is easier, and cheaper to retain and hopefully up sell existing customers then it is to acquire new ones - this is probably the biggest flaw with Premium Rate SMS there is, buyers buying into a service without fully understanding the costs because there's no one there saying, right that will be $$$'s so end-users don't see the actual cost until next months phone bill.

So the question or not on whether customer service is worth it or not comes down to the business model - do we retain customers, or continually get new ones? It's the difference between owning a roadside cafe versus the corner shop - the roadside cafe is more interested in putting up signage by the road that will temp unsuspecting victims to eat their food and buy their products, where as the corner store allocates resources into being helpful, reasonable prices, etc... because they can't afford to find new customers if the old ones go elsewhere.

Sometimes I'm amazed at how large corporates who post massive operating profits get so big, and the profits are so massive it's ridiculas - after all, if you asked most people who they disliked dealing with you'd probably find they'd be in the top 10 or 20 companies in the country.

The only reasons I can think of are generally the weakness reasons for trading with companies - things like blind loyalty (being Australian, the biggest brand who will go unnamed is probably the big vermin in the sky - people talk about postal workers in the US, well the staff it this airline would be on the top of my list for most likely to go on a shooting rampage). And major telco's as a consumer can be awful to deal with - so why do it? Smaller aggregators can probably offer the same plans and products at about the same prices but offer much better service? Who knows - it probably comes down to the fact that because they think they're big for a reason and that good enough for them, either that or they are too lazy to try and find the small business who offers the same stuff and treats you like a person?

If the business god came out of the sky today and decreed that each business only had one sales tool with an unlimited budget, I think I would opt for a quality customer service as my tool to grow the business - I admit, if I walk into a men's store and have a look around at their wares and don't have an assistant come over and ask if I need help I walk out, the last thing anyone wants is to turn around to a business and say "Hi, I was just wondering if someone could give me some customer service?" If the customer doesn't want it they'll tell you sooner than if they do and you don't provide it.

I don't know - I guess this is becoming a bit of a rant again? At the end of the day, although I haven't done the figures, but I'm pretty sure that being nice and helpful doesn't actually cost the company any more in operations/sales costs so why not make hay while the sunshine's because it's the cheapest way of doing well in my honest opinion.

Cheers,
C








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