AgEBB-MU CAFNR Extension

David Burton
Civic Communications Specialist
2400 S. Scenic Ave.
Springfield, MO 65807

June 26, 2018

Customer Service Keeps Customers, Increases Revenue

SPRINGFIELD, Mo. — Smart consumers are scrupulously looking for better pricing, quality, and service while maintaining the minimum quality level they require. What does this mean to a business owner?

"The cost of replacing a lost customer can be four to five times the cost of retaining an existing one. This does not take into account the lost revenue during the period where you are trying to attract the new," said David Burton, community development specialist with University of Missouri Extension.

According to the U.S. Department of Labor, 95 percent of unsatisfied customers do not complain to the business owner. Then, unsatisfied customers tell 9 to 10 others. Sixty percent will return if the complaints are resolved and 95 percent will return if the problem is resolved quickly.

"You can assume that for every complaint you hear, there are 19 other unhappy customers telling their story to nine friends and neighbors. That means for each complaint you hear, there could be 170 people forming a negative word-of-mouth impression of your business," said Burton.


How can you keep existing customers patronizing your business? There are several strategies according to Burton and one of the most important is to survey your customers.

"Ask them about their satisfaction using comment cards, a post-sales follow-up, or social media. Use those responses to improve your customer service policies and procedures," said Burton.

One furniture store requires delivery personnel to wear plastic shoe covers into customer homes, as a result of customer complaints about dirt tracked in during delivery. The policy is promoted as representing the level of customer care the business provides throughout the purchase process.


"Survey your front-line personnel. Encourage them to report any and all customer service issues so patterns can be identified and the problems quickly resolved," said Burton.

It is also important to train your personnel. Be sure they realize that customers are the reason for the work, not an interruption.

Cross train staff so they can more quickly resolve problems without shuffling the customer around from department to department or manager to manager.

"Be sure your employees understand that sometimes the solution is to listen closely and apologize," said Burton.

Letting the staff solve the problems is also a good idea. It is also important to ask your employees what they would need to resolve complaints quickly.

"Be sure they have the resources, whether it is approval to issue partial credit or the ability to give a small appreciation gift, to satisfy the customer," said Burton.

Better yet, offer the customer a choice of options.

Burton says that before you say "no" to a repeat customer, take a moment to consider the implications. Think about the revenue stream the particular customer represents, and the word-of-mouth message that could result.


"Don't make the assumption that because you don't hear many complaints, that they aren't out there. When you don't actively ask about customer satisfaction, you lose revenue opportunities," said Burton.

Those U.S. Labor Department statistics indicate most customers will not proactively voice their disappointment with a business. Asking customers their opinion sends the message that their business is appreciated and helps you understand which customer service strategy is a competitive advantage.

"In today's economic climate, customers vote with their dollars for businesses that deliver value and service. Listen to your customers and respond to their needs to enhance your business reputation and drive revenues and profits," said Burton.


Community development specialists in southwest Missouri offer a customized program called "At Your Service." Participants learn about working with multicultural communities and how to distinguish themselves with great customer service. The program can be offered in a full-day, half day, or lunch-and-learn types of settings. For an estimate on bringing this program to your employees contact one of these specialists: Dr. Amy Patillo, David Burton or Dr. Pam Duitsman in Greene County, (417) 881-8909.

Source: David Burton, (417) 881-8909

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