Let’s Pay Tribute to Good Customer Service!

A recent and ongoing consultancy engagement with a new start up reinforced a central tenet of entrepreneurship: Good customer service is invaluable to your revenue, to your brand and to your sustainability.

Tasked with providing entrepreneurial consultancy support to an e-store start up marketing a “linen lifestyle,” we have been working with the new business operator to establish the LLC credentials, set up the EIN, build the website and e-store and advise on pricing strategies, cost containment strategies, vendor management and material inventory strategies, as well as understanding the customers’ decision making criteria to optimize sales opportunities.

The concept of this client is sound. High quality materials, attractive design options, artisanal embellishments created by the client, who is an artist by training as well as an accomplished seamstress, and offered for sale online, with the potential for a brick and mortar presence in the future. The materials are almost exclusively high quality linen, a classic fabric with so many positive properties in demand from today’s discerning consumers. Linen is an environmentally conscious fabric,  100% natural, breathable, elegant, appropriate in almost any situation. The history of humanity’s use of linen goes back thousands of years, a clear indication of the sustainability of the concept.

Linen, created from flax, has been used for millennia by many cultures and societies

As we worked on the elements of vendor management, the client received an outreach email from a vendor that was primarily an online wholesaler of high quality linen yardage that the client uses to create girls’ and women’s dresses, blouses and skirts, as well as hand towels, guest towels, table linens (napkins, table cloths, table runners) and even linen bread bags and shopping totes. The vendor’s email asked the client if they could set up a video conference call to discuss the client’s purchasing patterns, additional services that the vendor could provide and how the client might maximize various discount opportunities.

There are many online businesses, as well as conventional businesses with an online presence that ascribe to a different philosophy. Once the consumer is engaged with their online portal, selecting their wares and moving to checkout, the transaction is considered successful. The attitude often can be characterized as “Once they’ve submitted their order, we have no obligation to show them how they could have saved money because those savings would come out of our revenue share.” The other consideration for many was that their online customers were essentially a “captive audience” who were resigned to pay the price as presented with no expectation of any discounts or deals. They see the transaction as a one time event, with hopeful wishes for another to follow.

The strategy employed by my client’s linen supplier was one that was designed to engender brand loyalty and provide an incentive to increase my client’s business with the supplier. The meeting was scheduled and executed as a video conference meeting. The supplier’s representative wanted to learn about my client’s aspirations. What was the nature of my client’s business? The representative had reviewed my client’s purchases over the past few months, and probably had tracked the visits to the website, the product pages viewed, as well as the products purchased. Understanding my client’s choices and preferences provided the opportunity for the representative to make some observations and product suggestions. What was really impressive though, was the representative’s offers for various discount opportunities geared toward my client’s product proclivities. The representative pointed out how my client had missed an almost automatic 7% discount and then promoted the capability of earning and additional 15% on top of the 7% by timing purchases for specified products (including several categories that met my client’s purchase history) during a certain time of day, what they called “happy hour.” She then offered my client the ability, once my client had their EIN, to earn a 10% discount on wholesale orders.

Active outreach by customer service representatives can truly enhance your business profile

This is where this supplier’s philosophy is divergent. They do not consider any of their online customers’ transactions to be one time events. Although some transactions may be, the sales leadership of this company have adopted a proactive strategy designed to engender loyalty from their customers, encouraging them to return to their e-store for future transactions. They review their customers’ orders, they analyze their customers’ purchase patterns for both frequency and product preference and they personalize their relationship by communication. And they’re not afraid to reveal to their customers the opportunities for the customer to capture additional discounts under the presumption that the money saved on today’s transaction will inevitably find its way into the next transaction. The reduction in the margin by the extension of these discounts on the present transaction is a small price to pay for the value of the future orders generated by that customer.

Customer service can have several levels of performance. There is customer service at a call center where the CSR answers specific questions and responds to specific requests. There is customer service that follows a set script to promote products or services when the phone rings or when they’re given an outcall list of phone numbers to dial. Then there is the highest level that learns who their customers are, what those customers’ needs for success are or will be, how and when their customers decide what they will purchase and how they, the supplier, can provide support to ensure their customers’ success, including purchase incentives (discounts and deals), liberal sampling programs and “frequent purchase rewards” programs. The investment in this highest tier customer service is probably significantly greater than the call center style customer service programs. But if the success of the supplier that engaged my client is any indication, the ROI is well worth it.