Page 5: The benefits of providing good customer service
Providing good customer service enables first direct to create a distinctive position for itself in relation to competitors. This requires investment in employees, training and processes to maintain high standards. However there is a payback: good customer service can reduce marketing and some operational costs.
Market research clearly shows that customers enjoy and are satisfied with the bank's services. This means that they are more likely to remain with the bank. Customer retention is important to any business. Marketing and promoting a bank to new customers can be expensive. It is much more efficient to keep existing customers than focus resources on searching for new ones.
Satisfied customers are also good adverts for the bank. Market research shows that customers are happy to recommend first direct to other people. A person who really likes a service and recommends it to others is called an advocate. One in three of new customers come to the bank as a direct result of recommendations from existing customers.
Providing good customer service also means that customers have fewer complaints. Dealing with complaints can be costly. So, again, by providing good customer service, the bank can reduce the costs of resolving customer problems.