Why Shoddy Customer Service Exists

photo by Mats Gullikstad

Catherine’s post and a recent one by James reminded me of recent thoughts on customer service.

It’s a Numbers Game

I say that the main reason we experience poor customer service is because it’s a numbers game.

So, what are the numbers and who is this game’s players?

The numbers are those following the dollar sign, namely profits. And the players are the shareholders who own equity in these companies. In an effort to show continued growth, company bean counters are ordered to cut costs, and the resulting emphasis on sales and profits mean that things like customer service often gets de-emphasized.

In a country with over 300 million people, these companies know that any disgruntled customer will be easily replaced by another unsuspecting one. The lure? Low prices. And I mean really low. So low that each item itself must have a very low profit margin. Which means everything must be sold in huge quantities in order for the company to show adequate profits.

An Example: Best Buy

A year or two ago, I bought a DVD box set of a movie trilogy (Back to the Future, if you must know) from my local Best Buy. However, once I got home and put in the first disc, I realized I had mistakenly bought the pan-and-scan version instead of the widescreen version (always preferable, imho).

When I went back to the store to request an exchange, the person at the return counter gave me a bunch of reasons why I can’t return it, e.g. it was already opened, etc. Mind you, I went in to EXCHANGE it for the widescreen version — it wasn’t like I was somehow pirating the video and RETURNING it. Anyway, after a polite conversation with a supervisor, I got my widescreen box. Still, the experience left a sour taste in my mouth.

Now, will I shop at Best Buy again?

Sadly, yes. But, not if I can help it.

As long as I and millions of others have that same attitude, then, I don’t see how a big chain will improve their customer service. There’s just no incentive. Companies like Best Buy, Wal-Mart, and the like know that their low prices will inevitably draw you back (like, $30 for a DVD player?).

The Solution to Bad Customer Service

However, we’re not completely at the mercy of these companies.

• Try a different store branch - sometimes a different branch of a store will have more caring employees (see below for an example)
• Try a different store - instead of Best Buy, try Circuit City, or Fry’s.
• Try a local store - you may have to pay more, but the service can be better (see below)
• Shop online - there are a lot of alternatives online, but stick to the well-known retailers, and check www.resellerratings.com if you have any doubts

You’ll notice the one thing in common to these alternatives: Voice your displeasure by spending your money elsewhere.

The Importance of People

Through it all, the most important thing to remember is that the kind of people running your local whatever-store makes a big difference in the kind of customer service you may experience.

Even a different branch of the same store, for instance.

Union Bank is one institution I deal with on behalf of a non-profit organization for which I volunteer. I’ve had to call their 800 number on several occasions, and the experience is often less than stellar. In the East Bay, they have a physical branch I’ve visited. It has mediocre to poor customer service, depending certain alignments of the celestial bodies.

But the branch in South San Francisco is superb. I attribute this solely to the VP there, Laura, who seems to have the enthusiasm of 10 people. The other employees there are also very helpful, no doubt because Laura had a hand in their hiring, I’m sure.

You Get What You Pay For

This saying is true when it comes to customer service. For those places that sell cheaply priced goods, how much of that profit goes into employee salaries, product exchanges and returns and replacements, employee educational programs, and advancement opportunities and other incentives?

It seems like stores that have slightly higher prices are more apt to have better customer service, and of course, in high-end boutiques or luxury car dealerships, excellent service is de rigeur.

Caring About People, Not Profits

But whether it’s a low-end or high-end business, the key to good customer service is that a business owner needs to care about his or her customers, and also needs to hire people who also care about customer service. The businesses that are successful (in a good, tell-about-them-to-your-friends-kind-of-way) are the ones who care more about acquiring and keeping loyal customers, rather than caring only about short-term profits.

That’s how I want to be treated, and that’s how I treat my clients.

Take care of your customers, and the profits will come.

Thank you so much for checking out my blog! If you like what you see, I'd like to invite you to subscribe to my RSS feed and maybe tell your friends about it. I'd really appreciate it!

Other posts you may enjoy:

1. Why Be Wary of Super Cheap Products
2. PLR Articles, the Microstock of Written Content
3. The Need to Belong
4. The Bitter History Teacher
5. 10 Ways to Explain The Number 1 Rule to Financial Responsibility

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