return on investment in customer service: the bottom line report

Posted in blog posts on 11 March 2011 by Leon Paternoster
5 comments on this article

Overview

Our research report examines what customer service activities bring the best returns, how we go about measuring customer intangibles and how to achieve an ROI from customer service.

Buy the report from our shop.

You can also buy the executive summary.

It consists of the following quantitative and qualitative data:

  • a survey of 153 senior executives in UK–based organisations
  • 23 case studies from the public, private and third sectors that demonstrate how organisations are working to achieve a return on investment in customer service
  • a literature review of academic and practitioner articles
  • a series of recommendations to help organisations achieve a return on their customer service investment

There's also an executive summary that you can buy from our shop.

Who is it for/how will it help me?

The research is aimed at anyone who is involved in:

  • making a case for customer service as a strategic driver
  • finding ways of achieiving some form of return on investment in customer service
  • measuring customer satisfaction, sentiment and other more intangible customer measurements
  • measuring return on investment

Key findings

The research found that organisations believe that there is a link between investing in service and achieving some form of ROI. More often than not it's investment in more complex, harder to define activities such as empowering staff and gaining an understanding of the customer viewpoint that bring the best returns, rather than ‘harder’, cost cutting activities such as moving the contact centre off–shore.

Similarly, the research concludes that some harder to measure goals — such as establishing trust, loyalty and some form of emotional connection with customers — bring the highest returns.

  • 81% of respondents believe that gaining an understanding from a customer viewpoint is very likely to lead to an ROI in customer service
  • More complex people-driven concepts such as ‘culture of service quality’ and the ‘whole customer experience’ are expected to be much more important in the future
  • The public sector sees ‘having a culture of service quality’ as its future top priority
  • 47.3% of respondents say off-shoring/outsourcing is unlikely to lead to ROI in customer service
  • interaction between frontline staff and customers is a key activity leading to ROI
  • right staff with the right ‘inborn’ attitude to customer service is a major contributor
  • empowering staff to make decisions delivers increased value for both customers and the organisation
  • customer satisfaction is easy to measure and the dominant metric among service providers
  • customer service is beginning to play an increasingly strategic role in organisations

Where can I buy it?

The full research report is available in our shop. You can also buy an executive summary.

Find out more about customer service ROI

We'll be publishing a series of blog posts over the next few weeks that will explore the following areas:

Interested in ROI and customer service? Subscribe to our blog feed and follow us on Twitter.

Comments

  • “

    I am delighted to see the value placed on the interaction between frontline customer service employees and customers by the repondents in the new report.

    As a customer it plays a pivotal role in perception of the quality of an organisation's customer service.

    It is pleasing to see that Senior executives are moving towards an acknowledgement of this and are not simply seeking easy but less effective improvements such as policy/practice changes, which have little positive impact on the emotions and beliefs that customers are left with after dealing with an organisation.

    As a customer service psychologist it is heartening also to read that there is recognition of the need to find and recruit people who are naturally inclined to deliver excellent service.

    In the past, too many organisations have fallen into the trap of believing that anyone can be trained and managed to achieve the same high standard of customer service provision.

    There is a golden opportunity at recruitment to consider what natural motivations, attitudes and personality will lead someone to want to provide outstanding customer service.

    Missing this window of opportunity will significantly increase the cost and effort that an organisation must expend in training and management of customer service employees and will set an immovable low ceiling for the quality of their customer service delivery.

    On the other hand, organisations that invest in finding the right people for their front-line customer service roles will steal a march on their competitors in the battle to win the hearts and minds of customers.

    ”
    Amanda Callen on 16 March 2011
  • “

    Thanks for your comment, Amanda.

    The report highlights the importance of customer/organisation relationships. Unsurprisingly, 3 of the top 8 activities survey respondents identified as leading to some form of return on investment in customer service related directly to staffing, recruitment and training. The 3rd most popular response was 'training and development of staff in soft skills'. (Incidentally, offshoring was bottom of the list).

    The report indicates that simple notions of price and traditional ideas of what constitutes 'good service' won't be the most profitable activities in the future; it'll be forming relationships and establishing emotional connections with customers. Staff (and not just frontline teams) are obviously central to achieving this.

    ”
    Leon (web editor) on 16 March 2011
  • “

    It is so helpful to be able to move away from Customer Satisfaction, Net Promoter and Customer Loyalty as measures of the return on investing in Customer Service.

    How refreshing to read substantial, independently verified, research that endorses the longer term business benefits of trust, advocacy and an emotional connection.

    This is what we all felt in our hearts to be true, but could never really 'prove' to the satisfaction of Boardroom scrutiny. How long before we now see a Customer Service Director on every Board?

    I believe that this is truly signifcant research that will do for Customer Service what the MacLeod Report has done for Employee Engagement.

    ”
    Martin Howe on 30 March 2011
  • “

    Thanks Martin.

    You're right to say the report identifies a shift from 'simple' customer satisfaction measures to more complex, sometimes yet-to-be-developed metrics. But customer satisfaction will remain an important barometer.

    NPS is covered in some detail in the report; as I'm sure you're aware, there are questions over its meaningfulness and some of our case study organisations don't use it as they don't feel it serves their needs.

    Leon

    ”
    Leon Paternoster on 31 March 2011
  • “

    At last someone has actually come out and said the blindingly obvious!
    If you are genuinely interested in people and want to help them, you will be good in a customer service role - if you are not, all the 'training' in the world will not get you there. Why does it take so long for people to see what is right under their noses?

    ”
    Inogen MacKenzie on 22 June 2011

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