What is customer service? Ultimate guide

The ultimate guide to customer service: what it is, why it's important, and tips for improving it.

By Courtney Gupta, Customer Service Enthusiast

Published May 26, 2021
Last updated June 21, 2022

Customer service can make or break a business. But not everyone agrees on what it is or how to do it well. In this guide, we’ll share how to set your busiess up for customer service success.

The definition of customer service

Customer service is the act of supporting and advocating for customers in their discovery, use, optimization, and troubleshooting of a product or service. It’s also the processes that support the teams making good customer service happen. The objective of customer service isn’t just to find a quick solution to any one customer problem. It’s to build a long-term relationship, one where each customer interaction offers opportunities for deeper, more valuable engagement.

The main difference between service today and service 10 years ago is that customers expect premium service to be built-in from the first sales or marketing interaction and carry through to the moment they ask for help, post-purchase, and back again. To position themselves for success, businesses must integrate service into the journey at every interaction point.

This may sound like a lot more than you thought. If so, you’re not alone. We’ve narrowed it down to a few key takeaways:

Why is customer service important?

Customer service is now a key differentiator between companies, a top consideration for customers, and a profit-generating force in its own right.

And whether a company exceeds or falls short of customer expectations is often directly tied to business success. It’s a high-stakes game—61 percent of customers would now defect to a competitor after just one bad experience, according to Zendesk’s 2022 Customer Experience Trends Report. That’s a 22-percent jump from the previous year. Make it two negative experiences, and 76 percent of customers are out the door.

Whether you’re a well-established firm or just starting to scale and grow, a successful customer service team
can help attract new business, boost retention, and increase sales among your existing customer base.

Benefits of great customer service

For companies that succeed at wowing customers, the opportunities for growth are immense. It’s impossible to overstate the importance of customer service.

  • 73 percent of business leaders report a direct link between their customer service and business performance.
  • 64 percent of business leaders say that customer service has a positive impact on their company’s growth.
  • 60 percent say it improves customer retention.
  • 47 percent report an increase in their ability to cross-sell.
  • More than 60 percent of customers say they now have higher customer service standards.

*Zendesk’s Customer Experience Trends Report

How to deliver excellent customer service

Whether you’re building a support team from scratch or you already consider yourself a pro, we’ve identified tips from our latest CX Trends Report to help you drive better customer service.

1. Make agent training a priority

Companies with high-performing customer support teams understand the need for more training, more empathy, and more investment to reduce churn and empower their people. Consider developing a tiered training plan that starts with basic technical skills, including product knowledge, and then advances agent knowledge at regular intervals.

In fact, high-performing companies are nearly 10 times more likely to strongly agree that their agents are of the highest caliber and over 6 times more likely to have plans to greatly extend education and training opportunities.

2. Automate repetitive tasks

Identify and automate the most repetitive tasks to free up agents’ time and improve performance. For example, high performers are nearly 3 times more likely to use AI-powered chatbots to help with agent workflows and it’s paying off. 63 percent of business leaders believe chatbots are driving large cost savings.

61 percent of companies also expect the majority of customer service interactions to be automated in the future.

3. Personalize every experience

Give agents access to valuable customer information—beyond just the customer’s name—that they can use to improve experiences. In fact, 72 percent of customers expect agents to have access to all relevant information.

90 percent of customers will also spend more with companies that personalize the customer service they offer them. And 92 percent will spend more with companies that ensure they won’t need to repeat information.

4. Evaluate existing customer service channels

93 percent of customers will spend more with companies that offer their preferred option to reach customer service. Ensure that you have satisfaction metrics linked to each and every channel. Actively track and benchmark performance across channels to check for continuous improvement.

5. Focus on business impact

Create opportunities for agents to drive profits through upselling and cross-selling, informed by a deep understanding of the customer’s immediate needs. Establish a separate profit and loss statement that captures revenue generated by agents so the link between customer service and business growth is more tangible.

High performers are 7.6 times more likely to strongly agree that they view customer service primarily as a revenue driver and are 6.2 times more likely to strongly agree that customer service funding has kept pace with company growth.

6. Integrate systems

Integrate customer service and CRM platforms to monitor changes in customers and their lifetime value. Sharing data between these platforms can lead to the discovery of personalized, relevant solutions to customer issues that otherwise wouldn’t be considered.

7. Keep leadership in the loop

Ensure the core team provides regular updates to leadership so they’re aware of evolving customer service plans and metrics. Create opportunities for customer service insights to play a greater role in larger company policy and strategy. Leaders of businesses with the highest customer satisfaction scores understand the inherent value of their customer service teams. Not only are they more likely to prioritize funding of customer service initiatives, but they’re also more likely to keep a close eye on the business impact and make necessary changes along the way.

Companies that are leading in customer service have buy-in from top to bottom. Instead of a siloed customer service team, leadership takes an active role in monitoring performance and impact. And in many cases, compensation of senior executives is directly tied to customer satisfaction.

High performers are over 9 times more likely to report that senior leaders view customer service metrics on a daily basis and nearly 8 times more likely to strongly agree that senior leaders immerse themselves in customer service.

Key customer service skills

Customer service skills or characteristics represent the qualities and abilities a customer service representative needs to deliver good customer service. Customer service managers tend to hire for technical skill sets. Technical skills are important, but soft skills matter, too.
Here are the top customer service skills your customer service representatives need:

  1. Ability to mirror a customer’s language and tone

    Mirroring another person’s language and tone can help you connect with them.
    Now, if a customer is angry on a call, you don’t want to copy their frustration. Instead, remember that “calm is contagious.” Be firm and work to bring the intensity down a notch. Customers respond well to getting help from someone who’s clearly level-headed.

    On live chat, responses are often short, quick, and incomplete. This makes it harder for you and the customer to understand each other’s tone. Choose your words carefully and err on the side of caution and clarity. Try to avoid puns or regional turns of phrase.

    Instead, use a gentle, informative tone. Patience is your best friend when helping a frustrated customer.

  2. Active listening

    When customers complain and are frustrated, they might not be able to take in what you say. So scrambling to a solution isn’t always the best approach.

    The ability to display empathy first is crucial. Remember, both you and the customer want to reach a resolution, not just a solution.

    Customers who are stressed need to feel heard. Explain that you understand the reason for their call. This little bit of empathy will go a long way toward improving a difficult customer experience.

  3. Clear communication

    Nobody likes to wait on hold, especially if they don’t know how long it’ll be until they can talk to someone.

    When customers call or start a live chat, set their expectations about hold times. This can help them feel like their issues matter to you.

  4. Interpersonal skills

    The best customer service templates do more than give agents pre-written text to copy and paste. They’re the starting point for high-quality, personalized answers so agents can build real, human connections with customers.

    Start with a template, then adjust it before replying to customers. This makes your answers feel more personal to customers.

    It’s OK to use your own voice and approach—just make sure you reflect the company’s brand and philosophy. For example, maybe you can make your own email signature unique.

  5. Comfort multitasking

    Live chat agents are expected to handle more than one chat at a time. This is a skill in itself. Great multitaskers don’t lose sight of the bigger picture as they’re bombarded by questions.

    Be careful not to handle too many chats, or else your customers will be waiting too long between responses. You can always put a chat on a brief hold if you need more time to find an answer. But just like with phone support, set expectations first. For example, ask if you may put them on a brief hold to conduct more research.

  6. customer service skills

  7. Attention to detail

    Sometimes it’s harder for customers to express themselves in writing. Don’t read too quickly and jump to conclusions. It takes a lot of training and practice to understand how different customers communicate. But it’s key to success in customer service.

    For example, someone who works in sales might come off as assertive or aggressive. Or, an engineer might want more technical details about how their problem was solved.

    Being able to read cues like this can give a customer care representative a better idea of how to tailor their customer service approach.

  8. Attentiveness

    Always respond to a customer’s social post when they need help. You may not be able to answer right away. But it’s still important to make quick initial contact with that customer and let them know when you’ll respond. Providing speedy responses means being adept in addressing a customer’s problem with a precise and polite tone.

    The exception to “always respond” is when agents are confronted with an obvious attempt to pick a fight on public channels. These comments are often directed at the company itself. It can be tempting to engage with the person if you feel strongly about the issue at hand. But a company can’t afford to have an agent, or any employee, make mistakes on social media. So, always proceed with caution when responding publicly.

  9. Collaboration skills

    Answering a customer’s question often involves working with other teams or departments. Is answering a social media post a job for customer support, or for marketing? Sometimes it’s hard to tell.

    If your marketing team manages your social media, make sure they connect with the customer service team for help with any incoming support requests. Remember, everyone is responsible for good customer service so agents will need to have strong collaboration skills.

Learn the top customer service skills for 2022 in our blog post.

4 examples of good customer service

We’ve all heard the stories of companies going above and beyond to provide their customers with incredible support. Morton’s steakhouse met a man at the airport with a steak because he asked for one in a tweet. Nordstrom’s accepted a set of returned tires even though Nordstrom doesn’t actually sell tires. But good customer service is ultimately about the scalable ways a company meets customer needs every day.

Here are a few everyday examples of excellent customer service.

1. Providing fast first-response times

76 percent of customers say they expect to engage with someone immediately when contacting a company.

2. Meeting customers where they are

Customers want to connect with you on the same channels they use to talk to friends and family—so being able to help a customer on their preferred support channel is one of the best ways to create an excellent customer service experience. Channel preference can vary based on the issue type and customer need. In fact, 73 percent of customers also want the ability to start a conversation on one channel and pick it back up on another.

3. Helping customers help themselves

89 percent of customers will spend more with companies that allow them to find answers online without having to contact anyone, such as via a knowledge base.

4. Being proactively helpful

Reactive support used to be the standard: you wait for a customer to contact your business with an inquiry or issue. Proactive service, however, is now a crucial type of customer service—it means anticipating your customers’ issues and addressing them before your customers do.

All year, every year at Zendesk, some of the world’s sharpest analysts are doing research and then painstakingly interpreting it to illuminate the coming year’s biggest trends in customer service. A few of the top customer service statistics to watch in 2022:

  • 68 percent of customers say it feels like most businesses need to improve the training of their customer service agents.
  • 54 percent of customers say it feels like customer service is an afterthought for most businesses they interact with.
  • 38 of agents say that the customer service team is not treated as well as others in the organization.
  • 81 percent of customers say a positive customer service experience increases the likelihood they’ll make another purchase.
  • 74 percent of customers say they will forgive a company for its mistake after receiving excellent service.
  • 76 percent of customers say they expect to engage with someone immediately when contacting a company.
  • 68 percent of customers say they expect all experiences to be personalized.
  • 70 percent of customers say they have made purchase decisions based on the quality of customer service.
  • 61 percent of customers say this past year’s crisis has raised their customer service standards.

Top customer service questions

What is good customer service?

Good customer service means meeting customers’ expectations. And meeting customers’ expectations pays off: 81 percent of customers say a positive customer service experience increases the likelihood they will make another purchase.

What company has the best customer service?

We found that some of the companies with the best customer service are Zappos, Dollar Shave Club, Slack, Amazon, and Lessonly.

Is the customer always right?

This customer service philosophy was never meant to be taken literally. The point wasn’t that customers should always get their way no matter how outrageous their demands. It was to give employees permission to truly listen to customers and go the extra mile to understand their needs.

How do you handle a difficult customer?

Handling difficult customers is challenging for any customer service professional. The most important thing you can do is show them respect, patience, and care. It helps to remember that your customers are human beings. If you can connect with them in a human way, it can make a big difference.

What are 3 important qualities of customer service?

Customers are looking for helpful and empathetic agents, always-on support, and fast, personalized, and uninterrupted service across their preferred channels.

How to structure your customer service department

Learn more about the key steps for structuring your customer service team with this free guide.

How to structure your customer service department

Learn more about the key steps for structuring your customer service team with this free guide.

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