by Kirk W. Johnson

Created on: May 12, 2009   Last Updated: January 16, 2011

Customer service will absolutely make or break your business. I learned many years ago that there are two things that businesses can compete on, price and service. A company that chooses to compete on price will find itself locked in a continual battle with others who run sales and lower prices because price shoppers have traditionally shown no loyalty. This means the company that bases its future on offering the lowest price will lose a large part of its customer base to the next company that can beat its prices.

The company that chooses to provide the best customer service can assure itself of customer loyalty and thus, profitability. There are many examples of companies such as Nordstrom's. They are renown for their superior customer service and their customers wouldn't think of shopping anyplace else, even if the items were a little less expensive. Another prominent example is Disney. A trip to any Disney resort shows that superior service is the bottom line. With every detail attended to and all "cast members" allowed and expected to provide superior customer service, their customers don't mind paying top dollar for their vacations.

On the other hand, poor customer service can doom a company quickly. Circuit City is a perfect example. When they replaced their experienced, knowledgeable sales associates with lower paid, lower motivated, less trained associates, customer service (and satisfaction) suffered a mortal blow. They were never able to recover from that.

I'm sure that you can find examples in your local experiences. There's that local restaurant you prefer to go to because they treat you like family and make you feel special. You probably don't even mind their prices because you like the way they make you feel. That's good customer service! That's why that restaurant is around.

If you think hard, I'm sure that you can think of that store that you refuse to go to, even those it's prices are amazing. You hate to go in there because they place is a mess, the disinterested sales girl is more interested in talking with her friends than in helping you, and that's only if you can actually find her on the sales floor. You would rather go somewhere else and pay a little bit more to get the help you need.....and deserve!

So yes, customer service can absolutely make or break a business. It affects everything from marketing to profitability. The better the service, the more positive word of mouth and thus lower marketing costs. That's all money that goes in your pocket.

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