Friday, November 7, 2008

Customer Service makes a difference in crunch times

As my old Economics teacher used to say "in a perfect market, all prices are known and the market finds its equilibrium quickly". And thanks to all sorts of online innovations (e.g comparision sites) the price of similar products (e.g. groceries) and services (e.g. insurnace) becomes increasingly easy to compare. These items therefore get increasingly competitive (e.g. near enough the same everywhere).

Therefore, assuming the quality remains constant, the only real competitive edge comes in the delivery and support of the item. In other words, the service provided, either during the transaction or afterward, becomes the difference.

This is especially true online, where customers think they get a lesser service compared to in-store. This is proven in a recent survey, where eight out of ten consumers believed they get better customer service in-store, rather than on the internet or over the telephone. What's even more surprising (especially in these more-frugal times of a recession) is that 73.4% say they are prepared to pay more for a product if they receive a better service in-store.

Tim Ogle, CEO at Retail Eyes , who did the survey is quoted as saying:

The public has spoken - even when their pockets are stretched in times of financial adversity like now, they are prepared to pay for quality of service.

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