{"id":27288,"date":"2023-03-08T11:29:32","date_gmt":"2023-03-08T11:29:32","guid":{"rendered":"https:\/\/www.intercom.com\/blog\/?p=27288"},"modified":"2023-12-01T22:02:07","modified_gmt":"2023-12-01T22:02:07","slug":"what-is-customer-service","status":"publish","type":"post","link":"https:\/\/www.intercom.com\/blog\/what-is-customer-service\/","title":{"rendered":"What is customer service and why is it important?"},"content":{"rendered":"

In today\u2019s competitive business landscape, customer service has become a crucial differentiator.<\/span><\/p>\n

Modern customers are looking for exceptional experiences \u2013 and this includes the customer service they receive.\u00a0<\/span><\/p>\n

Nowadays, the quality of your customer service can make or break your business\u2019s growth. <\/span>According to Gartner<\/span><\/a>, 89% of companies now expect to compete mostly on the basis of <\/span>customer experience (CX)<\/span><\/a>. <\/span>Another study found<\/span><\/a> that 93% of customers were likely to return and make repeat purchases at companies with excellent service, while 80% said they had stopped doing business with a company because of a poor customer experience.<\/span><\/p>\n

With <\/span>retention top of mind<\/span><\/a> for many forward-thinking businesses, it\u2019s never been more important to provide <\/span>world-class customer support<\/span><\/a>. But what exactly is customer service, and how do you deliver fast, helpful experiences that make customers happy? Read on to learn more.<\/span><\/p>\n\n

What does customer service mean?<\/span><\/h2>\n

Customer service is the support you provide to your customers (and potential customers) throughout the customer journey. Its goal is to address customer needs by resolving issues, troubleshooting problems, and helping them to get the most from your product or service.<\/span><\/p>\n

\u201cEveryone who interacts with customers has a role to play in providing excellent customer service\u201d<\/p><\/blockquote>\n

While often considered to be the sole responsibility of your <\/span>customer support<\/span><\/a> team, everyone who interacts with customers \u2013 from sales to customer success \u2013 has a role to play in providing excellent service.\u00a0<\/span><\/p>\n

The importance of customer service<\/span><\/h2>\n

Customer service is a hugely important factor in keeping customers happy and engaged with your business. And happy and engaged customers buy more, come back again and again, and make recommendations to their friends and family.<\/span><\/p>\n

We\u2019ve already seen that great service can improve retention, while poor service can contribute to churn. In fact, customer service has a major impact on every stage of the customer journey, from helping to attract and win new business to improving engagement and <\/span>customer satisfaction<\/span><\/a> for existing customers.<\/span><\/p>\n

\"customer<\/p>\n

1. Attract<\/span><\/h3>\n

A reputation for providing great support gives you an edge over the competition. <\/span>In one survey<\/span><\/a>, 50% of respondents said \u201cefficient customer service\u201d was the factor most likely to have a positive impact on their perception of a brand, even over price (32%). This shows that support has a powerful (and often overlooked) brand-building function that can help you appeal to new customers.<\/span><\/p>\n

2. Convert<\/span><\/h3>\n

According to Microsoft<\/a>, 97% of customers say customer service is a key differentiator in their decision to use a company. <\/span><\/p>\n

Picture this: a potential customer has a question about your product and reaches out to your customer support team. They get a quick, helpful, friendly reply that answers their question <\/span>and<\/span><\/i> reassures them that they\u2019ll receive fast, efficient service if they decide to become a customer.\u00a0<\/span><\/p>\n

Now say they had sent the same query to a competitor at the same time, but they still haven\u2019t received a response. Who do you think they\u2019re more likely to do business with?\u00a0<\/span><\/p>\n

3. Retain<\/span><\/h3>\n

For existing customers, customer service is an important part of how you build up customer satisfaction.\u00a0<\/span><\/p>\n

By providing fast, efficient support, you can help to unblock customers <\/span>in context<\/span><\/a>, right when and where they have issues. This allows them to further deepen their usage of your product or service, creating stickier users.\u00a0<\/span><\/p>\n

Not only this, but by replying quickly and helping them to resolve any problems, you also build long-term trust. According to a <\/span>report by the Qualtrics XM Institute<\/span><\/a>, nearly 90% of consumers who give a company a \u201cvery good\u201d customer experience rating are likely to trust a company to take care of their needs.<\/span><\/p>\n

\"Customer<\/p>\n

4. Expand<\/span><\/h3>\n

According to the book <\/span>Marketing Metrics<\/span><\/i><\/a>, businesses have a 60-70% chance of selling to an existing customer, while the probability of selling to a new prospect is only 5-20%.\u00a0<\/span><\/p>\n

By supporting your customers, improving their customer satisfaction ratings, and helping them to get the most return on investment from your products, you increase the likelihood that those satisfied customers will expand their business with you: the Qualtrics XM Institute\u2019s report notes that 94% of customers who rate a company\u2019s CX as \u201cvery good\u201d are likely to buy more products or services from that company in the future.<\/span><\/p>\n

Key traits of good customer service<\/span><\/h2>\n

It\u2019s clear that when it\u2019s done right, customer service has a significant impact on a business\u2019s bottom line. But how do you know what good service actually looks like?<\/span><\/p>\n

In a recent survey, <\/span>our research showed<\/span><\/a> that three in four customers report \u201cfeeling valued\u201d as a top factor in their decision to continue doing business with a company \u2013 and if they don\u2019t feel valued, 64% say they would go elsewhere.<\/span><\/p>\n

\u201cSupport teams that provide personalized support are 2x more likely to report an increase in customer satisfaction, and nearly 2x more likely to report an increase in customer retention and loyalty\u201d<\/p><\/blockquote>\n

One way to help them feel valued? Personalization. Today\u2019s customers want \u2013\u00a0and expect \u2013\u00a0to be known and understood, and <\/span>79% of customers<\/span><\/a> are willing to share relevant information about themselves in order to get these contextualized interactions.\u00a0<\/span><\/p>\n

In our latest report<\/a>, 83% of support leaders said that customer expectations for personalized service have grown over the last 12 months, with 89% of support leaders calling it a key competitive differentiator. And its effects are notable: support teams that provide personalized support are two times more likely to report an increase in customer satisfaction, and nearly two times more likely to report an increase in customer retention and loyalty.<\/span><\/p>\n

In addition to feeling valued and receiving personalized customer service, there are a few other key traits of good service. In particular, customers expect fast, efficient replies. An \u201cimmediate\u201d response \u2013 that is, a response in 10 minutes or less \u2013 is important or very important to <\/span>90% of consumers<\/span><\/a> when they have a question.\u00a0<\/span><\/p>\n

And of course, customers want their problem to be resolved: <\/span>90% of consumers say<\/span><\/a> getting a resolution is their most important issue.<\/span><\/p>\n

It can also be helpful to know the traits of <\/span>bad <\/span><\/i>customer service. <\/span>Customers hate<\/span><\/a>:<\/span><\/p>\n