What is Customer Service [+Definition, Importance & Benefits]

What is customer service?

Customer service is the support you provide customers over voice, chat, SMS, email and social channels. It plays a pivotal role in the customer journey, spanning from pre-purchase to post-purchase stages, significantly influencing customer satisfaction and retention rates.

Today, customers seek quicker resolutions to their issues through their preferred channels. As a result, businesses have adopted customer self-service tools like IVR, AI-powered chatbots and voice bots to scale their customer service operations efficiently. These tools empower customers to independently resolve their queries, enabling your live agents to concentrate on high-intent conversations or complex issues.

In any business, typically, the customer service department undertakes four activities, which are

• Answering customer queries regarding product and service offerings

• Assisting customers encountering payment obstacles or technical glitches during product or service usage

• Guiding customers on how to make the most of their purchase

• Anticipating customer issues and engaging proactively reaching to ensure customer satisfaction

It’s important to understand that your objective should not be only delivering prompt service but also making the most of it. Because, in the clamorous market, only customer service can help you stay distinct and foster long-term relationships with your customers.

Read on to know why customer service has become the building block of any business’ core strategy today.

Importance of customer service

Research reveals a remarkable statistic: 12 positive customer service experiences have the potential to counteract the impact of one negative brand experience, according to recent customer service reports.

Customer service is instrumental in ensuring a high retention rate at your company. In an era where achieving product differentiation is increasingly challenging, how you cater to your customers becomes vital. Timely and responsive customer service has the potential to become your primary competitive edge as you grow.

Moreover, with the advent of social media, customers tend to share their negative experiences online more than positive ones, further damaging your brand reputation and loyalty programs. So, you must understand that customer service is as necessary as your product or service. Your priority should be improving the same through AI-led innovations and customer service automation.

How customer service works

Today, call volumes are up and customers need instant service. There are three main streams of delivering customer service:

• Proactive support: Anticipate customer issues and solve them before time

• Self-support: Empower customers with friction-less self-service tools

• Agent empowerment: Leverage AI and automation to help agents improve First Contact Resolution

Anticipate customer issues and engage with them proactively

Customer issues can vary widely. However, when you notice a particular issue occurring repeatedly, it's essential to identify the primary contact drivers and promptly share real-time actionable insights with your teams. This collaborative approach helps improve processes and enhance product capabilities.

Being proactive in your communication and displaying empathetic engagement when you detect signs of frustration can elevate your customer service standards. This approach resolves immediate concerns and contributes to building a customer-centric brand reputation.

Empower customers with friction-less self-service tools

In today's business landscape, the absence of 24x7 customer service can undermine even the most remarkable products or campaigns. Customer issues can arise anytime, anywhere and you must be prepared to assist them whenever they need help.

This is where self-service tools play a crucial role. Having live agents available around the clock is not always feasible, especially if you operate across different time zones. Therefore, it's essential to establish a comprehensive knowledge base and interactive Q&A-based troubleshooting guides on your website or mobile app.

Moreover, consider creating an AI-moderated self-service community and implementing omnichannel conversational AI. These technologies ensure that you can respond to customer queries at any time of the day.

Leverage AI and automation to help agents improve First Contact Resolution

First-contact resolution is crucial for your customer service goals and AI and automation are indispensable for achieving it consistently. Utilizing skill-based routing ensures that customer inquiries are directed to agents with the most relevant expertise, significantly increasing the likelihood of resolving issues during the first contact.

Similarly, equipping your agents with a 360-degree view of customers through a unified agent console provides them with essential information at their fingertips, greatly enhancing their ability to resolve issues efficiently.

Furthermore, contact center AI plays a pivotal role by introducing automated case management streamlining workflows to ensure that cases are promptly and consistently handled. Additionally, AI-powered knowledge recommendations assist agents in delivering accurate and timely solutions, ultimately elevating customer satisfaction levels.

7 pillars of customer service

Seven pillars of customer service remain core to any business. Let’s check them out.

1. Communication channels

Voice

Customers connect with businesses through toll-free numbers, entering queues to await assistance. This medium offers quick and efficient solutions. Phone calls also establish human connections, fostering empathy and detailed problem resolution. Although effective, long waiting times can frustrate customers. Businesses leverage Interactive Voice Response (IVR) systems, reducing call volumes, average hold times and operational expenses.

SMS

Mobile messaging or SMS communication has gained traction due to its convenience. Customers easily submit service requests by sending a few words to a designated number. While SMS doesn't directly provide solutions, it helps customers bypass the process of raising tickets or enduring service call queues. Companies arrange callbacks, enabling customers to access assistance at their convenience.

💡 Do you know: Customers are increasingly using messaging platforms for support. You can also provide real-time support seamlessly on WhatsApp, Live Chat, Apple Business Chat, Telegram, SMS and other messaging platforms.

Email

Many customers favor emails as it allows customers to explain the issues in detail and at their own pace. Threaded conversations offer comprehensive timelines, including concise documentation for future reference.

Live chat

Real-time text-based interactions on live chat support offer a balance between speed and personalized support. It's popular for its convenience, quick responses and readily available chat logs.

Automated chatbots promptly address common queries, enabling agents to focus on complex conversations. Industries like banking, eCommerce and travel heavily rely on live chat for customer service.

Self-service

Customer self-service empowers customers to find solutions 24/7 through FAQs, knowledge bases and tutorials. Particularly effective for straight queries, self-service reduces queue congestion, accelerates time-to-resolution and enables customer service teams to focus on more intricate issues.

Virtual Agents

A virtual agent offers frontline assistance, swiftly addressing all your customers' service requirements. Going beyond the capabilities of chatbots, virtual agents use natural language processing to interpret human inputs and understand their intent.

Furthermore, virtual agents can identify complex issues and seamlessly transition conversations to human agents when required. They prove particularly valuable for providing technical support during periods of high seasonal demand, on specific days of the week or within certain hours.

💡Good to know: Today, Advanced AI-powered virtual agents excel at information dissemination, lead qualification, support ticket creation, event sign-ups and more.

Social Media

Customers engage publicly on social media platforms. Raising service requests via direct messages (DM) offers ease compared to traditional help desks or customer service lines. Prompt responses and callbacks demonstrate your commitment to customer satisfaction, showcasing your brand as socially aware and proactive.

2. Proactive support

Anticipating the needs and concerns of customers and providing timely support is a highly effective strategy that not everyone can master. Actively listening to your customers, engaging with empathy, and going above and beyond are the essential qualities of excellent customer service.

It's crucial to recognize that proactive support isn't an instant achievement. Establishing a customer-centric mindset within your organization is the initial phase of this journey. Train your representatives to be responsive, patient, and technologically adept, ensuring that their primary focus is on the human aspect rather than just the operational side of it.

3. Customer satisfaction

Like proactive support, maintaining a consistent level of customer satisfaction hinges on factors like responsiveness, service speed and swift issue resolution. It's essential to cultivate a sense of accountability among your agents, making them understand that the foundation of customer success begins at their workstations.

This means that whether it's an occasional buyer seeking extra assistance or a loyal customer expecting top-notch service, the entire service experience must be punctual, with opportunities for enhancement promptly identified and addressed through ongoing training and coaching.

Good to know: Today, you can quickly build a CSAT survey, deploy it across all digital channels and then see the results in a single, unified report. Learn more about customer satisfaction software.

4. Rich knowledge base

The purpose of a knowledge base extends beyond mere support. Consider the knowledge base as a content repository designed to educate, motivate and assist customers in resolving their issues when necessary.

A knowledge base can be classified into two categories: internal and external. The former is intended for use by your agents, while the latter is meant for customers and potential customers. Its contents typically encompass FAQs, tutorials, troubleshooting guides, help articles, and more. It's essential to recognize that although the intended audience differs, the fundamental objective of the knowledge base, whether internal or external, remains the same — providing self-help resources when needed.

The knowledge base serves as your singular source of accurate information and should undergo regular reviews by a dedicated team to prevent outdated or erroneous content.

5. Customer Relationship Management (CRM) system

Customer Relationship Management (CRM) systems centralize your customer data, enabling personalized assistance by providing insights into preferences and purchase history. CRM tools streamline communication through automated responses and email tracking, ensuring timely and consistent interactions. By automating routine tasks, CRM allows your customer service teams to focus on complex issues, improving the overall service quality.

Furthermore, CRM facilitates segmentation for your targeted marketing and tracks historical interactions, ensuring context and continuity. Its analytics provide valuable insights into customer behavior, informing proactive issue resolution and enhancing satisfaction and loyalty.

6. Training and coaching

Agent training and coaching empower your customer service representatives to excel and provide top-notch assistance. Through continuous skill enhancement, agents are equipped with the knowledge and abilities to address diverse customer needs effectively. This includes mastering your company's products or services, honing communication skills and developing strong problem-solving capabilities.

Training also emphasizes the importance of empathy and emotional intelligence in customer interactions, fostering meaningful connections. Additionally, it ensures that your agents are tech-savvy, adapting to the latest customer service tools and systems.

Furthermore, agent training and coaching establish consistent service standards across the customer service team, ensuring customers receive a uniform and reliable experience with every interaction. These programs integrate feedback loops, allowing your agents to learn from their experiences and improve their performance continually.

Read more: How to show empathy in customer service

7. Customer service metrics

Customer service metrics offer a clear and objective way to evaluate the performance of your service teams and individual agents. They include metrics like response time, resolution time and customer satisfaction scores, providing a 360-degree view of your team meeting customer needs. It also aligns your customer service efforts with broader business objectives, ensuring that your service strategies support revenue growth and customer retention goals.

Additionally, customer service metrics drive data-driven decision-making by providing insights into service trends and patterns. This data enables you to identify areas for improvement, allocate resources effectively, and make informed adjustments to their service strategies.

Moreover, customer-centric metrics like Net Promoter Score (NPS) and Customer Effort Score (CES) keep your focus on the customer experience, helping you tailor your service to meet and exceed customer expectations.

Suggested read: Top 7 customer experience metrics to track

Benefits of customer service for businesses

Attention to customer service helps you build a positive brand perception and boost your long-term customer success initiatives. Here are the other key benefits.

Improved customer satisfaction

Superior customer service is synonymous with shorter hold times and quicker resolution times. Prioritizing customer service and offering timely support can lead to an increased customer satisfaction rate and higher retention rate.

💡 Pro Tip: Customer satisfaction drops when customers don’t receive the resolutions they seek at the first point of contact. To prevent this, you must leverage sentiment analysis, share pertinent articles from your knowledge base and offer intelligent responses.

Greater competitive advantage

In today's competitive market, outstanding customer service sets you apart. Businesses with a reputation for excellent service are often chosen over alternatives, attracting more customers.

Increased customer loyalty

Exceptional customer service lets you create a solid emotional connection with your customers. When customers feel valued and well-supported, they are more likely to remain loyal to your brand and continue using your products or services.

Watch now: How to build customer loyalty through after-sales service

Positive word-of-mouth and referrals

Satisfied customers are likely to share their positive experiences with friends, family and online communities. This positive word-of-mouth, often driven by high Net Promoter Scores, can significantly enhance your brand's reputation and bring in new customers through referrals. Happy customers, acting as your advocates, expand your reach and attract new customers who trust genuine recommendations.

Interesting article: Happy customers buy more

Higher customer lifetime value

Customers who experience superior service are more likely to make repeat purchases and spend more over their lifetime. This increased customer lifetime value contributes to your long-term revenue growth.

How to deliver good customer service

1. Nurture empathy

When you can’t tell the customers what they want to hear, showing concern and understanding goes a long way. By putting yourself into customers' shoes, let them know you understand their situation and are ready to help them in your own capacity. This approach makes customers receptive to the circumstances and reduces the escalation probability.

Scenario: A bank customer contacts customer service after an erroneous charge on his account. The representative acknowledges the customer's frustration, apologizes for the inconvenience and assures that the issue will be resolved promptly.

Suggested read: What is customer empathy: Learn from industry experts

2. Focus on personalization

There is no point in collecting customer data if you cannot use them to personalize customer service. Ensure that your agents treat customers respectfully and not as a ticket on the service queue. Personalization makes customers feel valued and drives customer loyalty.

Scenario: An online clothing retailer sends a personalized email to a customer suggesting new arrivals based on her previous purchase history. The customer appreciates the tailored recommendations that align with her preferences and heads to the app to check out the latest collections.

3. Prioritize speed and responsiveness

Acknowledging customer inquiries timely and offering proactive customer service at the earliest can give you a significant advantage over your competitors. In an age where businesses are struggling with high call volumes and customers with long hold times, staying responsive 24/7 and providing speedy resolution can help win customers’ trust.

Scenario: A restaurant guest posts a query on social media about the ingredients used in a specific dish due to allergies. The restaurant responds within an hour, assuring the customer that their concerns will be addressed and providing a detailed list of ingredients at the earliest.

Want to shorten your response time? Read How AI helps you cut response times

4. Deliver transparent communication

Customer service and transparency go hand in hand. Provide clear and honest information, especially when addressing mistakes or service disruptions. If your customers have spent their time and money and you cannot deliver against it owing to unforeseen circumstances, admit your mistake and be transparent about it. There is a high chance that customers would understand and won’t make a big deal out of it.

Scenario: An online retailer experiences a delay in shipping due to unforeseen circumstances. Instead of simply providing a vague status, they send customers an email explaining the delay, the reason behind it and a new estimated delivery date.

5. Stay consistent

Consistency in customer service is as critical as consistency in your products or services. Remember, a repeat purchase is not as simple as it seems. Customers tried your products or services, loved them, chose you over your competitors and came to repurchase expecting the same experience. Inconsistent customer service can lead to customer dissatisfaction and subsequent churn.

Scenario: A chain of coffee shops maintains a consistent level of friendliness and efficiency across all its locations. Customers know they can expect the same quality of service whether they visit a downtown store or one in the suburbs.

6. Be adaptable

You should set your customer service rules beforehand, but it’s also essential that you remain adaptable and try to accommodate customers’ diverse needs and requirements as much as possible. It’s those minor adjustments and modifications at the last moment that customers remember. Try to imbibe a customer-first mindset among your service agents and stay flexible to meet customers’ demands.

Scenario: An airline offers various seating options, allowing customers to choose seats with extra legroom or seats near the front for quicker disembarking. This flexibility caters to different customer preferences.

Hear from experts: Succeeding in the Customer-First Era

Transform customer service with Sprinklr Service

Customer service is evolving at an unprecedented pace, driven by changing customer expectations and the proliferation of communication channels. To thrive in this dynamic landscape, you need a comprehensive and advanced support solution that future-proofs your investment with essential features and capabilities.

Sprinklr's AI-powered customer service platform is designed to eliminate fragmented solutions that hinder agents from delivering tailored, seamless and prompt support across diverse channels.

Discover how the world's only Unified Customer Experience Management (Unified-CXM) platform empowers you to cultivate omnichannel service that leaves your customers delighted:

• Personalize your support by unifying conversational data and omnichannel context

• Decrease time to resolution with AI-powered smart responses and self-service that puts the power into the hands of the customer to find their own answers — freeing up agents' time to support more complex cases

• Streamline all customer cases into a single, intuitive 360° agent desktop

• Use AI monitoring across 30+ digital, social and messaging channels to identify inbound messages that matter the most to your business

• Auto-route sensitive and high-priority cases to the right agents at first touch with an automated routing solution