Why You Can’t Afford to Ignore Customer Service in Your Ecommerce Business

21/10/2019, Marketing, Hannah Leary

Top of your ecommerce agenda should be customer service. There’s no denying it’s a vital element of your business operations that affects how your company is viewed in the public eye and ultimately impacts your bottom line. Here, we explore the importance of customer service in terms of retention, referrals and reputation.

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Think about the last time you received bad customer service. Chances are, you vowed never to shop with that brand again, whilst hastily composing a scathing review and then naming-and-shaming them across social media. Indeed, these are the perils of providing poor customer service.

 

We can’t emphasise enough the importance of customer service for your ecommerce brand. It’s the difference between satisfied shoppers who spend more and share the love, or customers who are all riled up and ready to rip your reputation to shreds. 

 

Ultimately, the quality of your customer service affects your business’ bottom line, so you can’t afford to get it wrong.

 

When it comes to the importance of customer service in ecommerce, we often refer to the three Rs: retention, referrals and reputation. These three broad themes help to group all the different benefits of good customer service. Let’s take a look at each one in more detail:

 

Retention

 

As an ecommerce merchant, manager or marketeer, you’ll be all too familiar with the scarily steep price tag associated with customer acquisition. In fact, its costs around 5 times more to attract a new customer than to retain an existing customer! Reducing these costs remains a top priority for online retailers across the land.

 

Source: invesp

 

Good news though. By providing stellar customer service across all touchpoints, you can increase retention and reduce acquisition costs. 

 

If customers are pleased with the service they’ve received, they’re less likely to be tempted by your competitors. A superior experience becomes a valued asset, setting you apart in today’s increasingly saturated ecommerce market. 

 

Customers will keep coming back to your store if they feel like their needs are being recognised and acted upon, eventually becoming loyal patrons (as long as the high quality service continues, of course). 

 

Loyal customers purchase more frequently, spending more than average on each transaction. This increases their customer lifetime value (the total revenue a company can expect a single customer to generate over the course of their relationship with said company), which is a key metric when measuring success.

 

Ultimately, investing in your existing customers will pay off. Creating a first-rate customer service experience helps to decrease churn, which in turn decreases those pesky customer acquisition costs.

 

Top tip: Combine your top-notch customer service offering with a compelling loyalty program to really ramp up your retention rates. With a tool like LoyaltyLion, you can build a fully-customised loyalty program that keeps your customers existing customers engaged, satisfied and spending!

 

Referrals

 

It’s simple, happy customers will refer others. The more impressed they are by your first-rate customer service, the more likely they are to tell their friends and family all about you. In fact, 77% of customers would reportedly recommend a company to a friend after having a positive experience.

 

Your brand will be the hot topic of conversation, which could do wondrous things for your bottom line. After all, word-of-mouth is an effective – and cheap – way of attracting new buyers.

 

What’s more, in a snowball effect, customers who have been referred are more likely to in turn refer others. Referred customers are also more likely to remain loyal than customers who weren’t referred! 

 

This infographic from ReferralCandy sums up the importance of referrals neatly:

 

Source: ReferralCandy infographic via CrazyEgg

 

So, your mission: make today’s customers tomorrow’s brand advocates!

 

Top tip: The Shopify ecosystem has a wealth of apps to help merchants manage and track referrals. At Swanky, one of our go-to solutions is Refersion. Simply connect to your Shopify store and get a referral program set up in minutes – no need to be a tech whizz. Start turning your happy customers into affiliates and watch your revenue soar.

 

Reputation

 

Onto the third and final ‘R’: reputation.

 

It goes without saying that the standard of customer service you provide has a direct impact on your reputation as a company. The way you respond to a complaint can make or break your brand.

 

Good customer service is a key part of building a strong reputation as a trusted retailer. Through consistently delivering exceptional service to your customers and proactively supporting shoppers, you can increase the value and integrity of your brand. This will help attract new buyers and retain existing ones.

 

Conversely, providing a bad experience could spell trouble for your reputation, and your bottom line. After all, when it comes to customer service, bad news travels fast.

 

Source: imgflip

 

When you consider that close to 75% of consumers buy products and services based on a retailer’s customer service reputation, this is an area of your business you simply have to invest in.

 

Having a reputation for gold-standard customer service will give your brand a competitive advantage as well – which is critical in saturated industries where ecommerce brands are constantly going head-to-head in the fight for customers. 

 

Customer service solutions

 

There are plenty of tools out there in the Shopify ecosystem to help you provide a first-class customer service. Our favourite? Gorgias.

 

A help desk for ecommerce stores, Gorgias allows your customer service team to manage all of your customer support from across multiple CRM channels in one unified place – this includes conversations from email, live chat, phone and social. This, combined with one-click responses and automated inbox management, helps to reduce response times, increase efficiency and transform customers’ impressions

 

As well as cutting support time, eliminating ticket backlog and increasing conversions, Gorgias empowers support agents to move into an advisory role and provide an outstanding customer service experience that will supercharge your retention, referrals and reputation in no time.

 

We recently sat down with Gorgias’ Head of Partnerships, Phil Roireau, to discuss the dos and don’ts of ecommerce customer service – check out the Q&A videos here!

 

To summarise

 

Consider customer service the backbone of your business. Providing a positive customer experience with superior service will help you create a loyal following of satisfied customers who spend more and advocate for your brand. Your reputation will rise, along with your revenue. 

 

Want to know the secrets to good customer service? We’re busy rounding up some tried-and-tested tactics in a go-to guide just for you (complete with some of our favourite real-life examples). Keep your eyes peeled on the Swanky blog!

 

Let’s talk

 

Curious about how Swanky could transform your ecommerce store with an advanced tech stack and expert strategic guidance? Get in touch with our friendly team of Shopify Plus Experts today to find out – we love hearing from passionate enterprise merchants who are ambitious about unlocking their ecommerce potential!

 

 

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About the author

Hannah Leary

Hannah is Swanky's Content Manager and Copywriter. She enjoys researching the exciting world of ecommerce and crafting engaging articles to help ecommerce managers around the world make the most of their presence online. Her blogs specialise in ecommerce strategy, website design and store optimisation.

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