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It's simple, yet not many companies practice the magic of service recovery.
The magic in service recovery occurs when a front-line employee solves a customer's problem and does so in 60 seconds or less. Acting quickly, taking responsibility, making an empowered decision, and compensating the customer will result in customer loyalty that will increase your sales and profits and help to ensure your success in an increasingly competitive world.
In today's fast-paced world we need service recovery almost everywhere we go - from the grocery store, to our banks (everyone has had a problem here), to our cable (very frustrating), to service providers at home, and so on. It's frustrating, and customers can vent their problems and dissatisfaction in person, on the phone, on the Internet, and to their friends and family.
But the exact opposite is true if the magic of service recovery is used. Service recovery can have a major impact on an organization's bottom line with word-of-mouth advertising as customers tell their family, friends, and co-workers about the exceptional service they received from your company. Including compliments and "atta-boys" up on the Internet, they recognize you and call you by name. More magic happens when Internet providers make up for their screw-ups by providing a free month subscription, or grocery stores offer free replacement food items or free delivery... it's magic!
Service recovery is putting a smile on a customer's face after you've screwed up. It may not be your fault, but it is your problem. How you handle those mistakes is what separates you from the rest of the pack... and keeps customers for life.
I have developed the following four techniques for providing quality service recovery:
Practice the magic every day when customers confront you with a situation or problem. No business can afford to lose customers, if only because it costs much more to replace a customer than it does to retain one (five times more). Those who go out of their way to please customers and correct problems or screw-ups will soon have more customers than their competition.
Here's more magic: According to a study by the Wharton School, reducing customer attrition by 5 to 10 percent can increase annual profits by as much as 75 percent. The stakes are high.
John Tschohl is a professional speaker, trainer, and consultant. He is president and founder of Service Quality Institute, with operations in over 40 countries. He is considered one of the foremost authorities on service strategy, success, empowerment, and customer service. His monthly strategic newsletter is available online at no charge. He can also be reached on Facebook, LinkedIn, and Twitter.