Success Monday: The Remarkable Impact of Good vs. Bad Customer Service

Customer sales guru Teresa Allen says bad customer service can have serious negative consequences for your business, and she’s got the numbers to back it up. The bottom line, she says, is it’s well worth your while to train your staff to take good care of your clients.

“A survey by Dimensional Research of mid-sized company customers showed a strong and direct correlation between customer service levels and future spending (83%), especially in B2B transactions. Here are some specific highlights of the study regarding the impact of good and bad service encounters: ​

Impact of Good Customer Service on B2B Sales

  • 62% purchased more products or services
  • 58% would recommend company to others
  • 48% considering another purchase from that company

Impact of Bad Customer Service on B2B Sales

  • 59% overall stopped buying from that source
  • 55% switched to another provider
  • 40% recommended to others that they should not purchase from that source

In other words, as I discuss in my customer service keynote presentations, the spin from any customer service encounter is tremendous. Let’s just do a little math using these statistics with some hypothetical numbers:

Let’s say average B2B transaction for a company is $500 and there are 100 transactions in a week. That would give us $50,000 in sales per week or $2,600,000 per year.  If we gave bad service in just 10% of those transactions, and those 59% stopped doing business with the company, that would equate to a loss of $153,400 potential future business ($2,600,000 X .10 X .59)

Conversely, for every happy client in this business, they generate hundreds of dollars of repeat and referral business, potentially generating hundreds of thousands of dollars of additional business and income.

Your transaction level may be bigger or smaller than the one used in my example.  It really doesn’t matter. Here is the question: Are you willing to lose 59% of ANY number you are working so hard to generate? I would assume not. Thus it is baffling to me why businesses do not spend more money training staff on how to be business builders instead of business destroyers for their organization. The cost of lost business and the potential added revenue of incremental and referral business makes this a no-brainer business decision. All the marketing dollars in the world are a wasteful spend without a staff ready to serve and please customers.

Is any of this rocket science? No—it’s just common sense. But as you and I are frequently reminded in today's business world, common sense just isn’t that common any more!  Opportunity for business growth is waiting. Are you and your staff ready? If not, I would be happy to have a discussion with you on how you could improve your positive customer service spin and build your profits!”

Teresa Allen is a highly acclaimed customer service speaker and is the author of Common Sense Service: Close Encounters on the Front Lines. Visit her website to find more ideas on building your customer service culture. To contact Teresa call 800-797-1580 or email: