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As a business owner, you will likely know that keeping customers happy can be lucrative for your business. This is one of the reasons why retailers work so hard to make their premises attractive and pleasant for customers. A relaxed, happy customer purchases more than a stressed, unhappy one. This article will focus on the legal benefits of setting excellent customer service standards, so your UK business can consider the advantages of doing so against any potential cost.
What are High Customer Service Standards?
Customer service expectations change with time. Modern consumers expect UK companies to be friendly, efficient and contactable by various methods.
In practice, some modern examples of exceptional customer service include:
- allowing customers to contact your business through various communication channels (including telephone, in-store, email, website chat boxes and social media apps);
- providing a speedy turnaround to written queries (usually within 24 hours);
- resolving valid customer complaints with generous offers of partial refunds, store credit or item replacements (even when not legally bound to do so); and
- providing staff with regular customer service training to ensure customer satisfaction through polite and professional communication.
Let us now explore how excellent customer service benefits your business.
1. Good Customer Retention and Fewer Legal Claims
Almost every consumer has purchased a product and suffered an issue with it. However, there is a vast difference between a company that deals with the issue swiftly and professionally and solves the problem and an organisation that could be more friendly and caring.
During the current squeeze on living costs in the UK, consumers are becoming savvier to the need to shop with companies that prioritise an excellent customer experience. After all, no UK customer wants to spend money on items and risk an uphill battle to get a replacement or refund.
If your business fails to provide good customer service to your existing customers, this may affect your profits and increase your burdens. For example, unhappy consumers are unlikely to return. Additionally, they are more likely to start formal disputes regarding failure to provide returns, replacements or refunds. Moreover, if the product is expensive, your business may also suffer legal actions against it under consumer law.
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2. Less Advertising Costs
A well-known business maxim is that it is cheaper to keep existing clients than to replace them. For example, studies show that it can cost a business five times more to obtain new customers than simply retaining their existing ones.
One of the costs involved with losing your customer base is advertising. One of the primary purposes of advertising is to draw in new customers who know little about the business.
In the UK, the Advertising Standards Agency (ASA) is prominent in policing advertising to ensure they are legal and reasonable. Many of their rules and regulations aim to prevent misleading or inaccurate advertisements. In this way, UK businesses usually have to incur decent sums of money paying individuals to try their products before advertising them and utilising advertising agencies to ensure ASA compliance.
Naturally, suppose your business keeps the vast majority of its consumer base. In that case, it will spend less money on advertising in a legally compliant manner than a company that loses half of its customers each year.
3. Aids GDPR Compliance
The roots of excellent customer service lie in swiftly responding to reasonable customer requests. Some consumer queries involve providing information relating to them (known as Subject Access Requests).
Ensuring a positive customer experience can hugely benefit your business by helping avoid a fine of up to £17.5m from the Information Commissioner’s Office (ICO).
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Key Takeaways
Ensuring high customer service standards benefits your business. Firstly, it helps your organisation ensure good customer loyalty. In turn, you can avoid advertising costs to obtain replacement consumers. Moreover, it helps your business comply with UK law, reducing the risk of financial penalties and reputational damage.
Overall, it is worth incurring the time and effort of customer service training with staff. Furthermore, many business owners obtain expert advice on designing legally compliant processes that prioritise excellent customer support and dispute resolution.
If you need assistance keeping your customer service standards within legal bounds, our experienced online business lawyers can assist as part of our LegalVision membership. For a low monthly fee, you will have unlimited access to lawyers to answer your questions and draft and review your documents. Call us today on 0808 196 8584 or visit our membership page.
Frequently Asked Questions
This largely depends on the customer in question. While some UK consumers will acknowledge that a smaller business will have less staff to tackle customer issues, others expect a better, more personable customer service experience.
News of poor customer service now spreads quicker than ever. Many UK businesses have suffered hits to their brand loyalty through stories of terrible customer service on social media platforms. So it is crucial to have an effective customer service team at your business.
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