Free Articles

Why Does Customer Care Exist?

Customer Care departments don’t exist to simply “handle” complaints. Your department was established to be a major contributor to the organization’s profitability. Below are the top 4 reasons your department exists.

Reason #1: Retain customers. The number one reason Customer Care and Customer Service departments exist is to increase profitability. Customer Care/Customer Service departments positively impact the bottom-line by retaining customers. You’ve heard me say it before; a 5% improvement in customer retention improves profitability by 25% to 85%. (Bain & Co). When you retain customers who are unhappy or on the brink of defection, you are directly impacting profits.

Reason #2: Identify problems and take preventive action. Customer Care professionals are often the first employees to learn about service problems that could be threatening customer loyalty and profitability. In addition to responding to complaints, customer care professionals must capture, analyze, and disseminate critical feedback. All top problems should be confronted with a rigorous root-cause and preventative analysis process so that the causes for complaints are significantly reduced.

Reason #3: Consumer education. Consumer education results in better-educated consumers, which can translate into a decrease in unnecessary consumer complaints and inquires. Some companies have seen reduced warranty repair and service costs due to a consumer education program that reduces product misuse and false expectations about performance.

Reason #4: Employee education. Feedback from customers must be fed back to all employees who interface with customers. Employees need to know what the organization’s top problems are, what those problems are costing the company, how you resolved the problem, and how to reduce the occurrence of problems. A critical, non-negotiable function of customer care and customer service departments is to communicate customer feedback throughout the organization.

In many companies upper management is now requesting that customer service, consumer affairs, and customer care departments demonstrate value-added services. This “show me the results” request is demanding that we provide measurable bottom-line value. Getting back to our core purpose for existing helps us to create our bottom-line value.