knowledge base articles

When your business is on a low budget, there are probably several functions that are high-priority when allocating funds. Of course, your product team could use some financial assistance and marketing — especially advertising — could always use a little padding.

However, it might seem like a waste to invest money in your customer service team. After all, how can it really improve? Contrary to popular belief, your customer service team should be just as important  — if not more important than — as your other teams. After all, it’s the direct connection between your customers and your business.

1. Revenue increases with good customer service.

Revenue dictates every business decision. Companies measure success or failure based on money in minus money out. Profitability is king, regardless of whether it happens on day one or day 1001.

The number one reason why customer service is important in a business is that it correlates to revenue: 84% of organizations working to improve customer service report an increase in revenue.

why customer service is important reason 1 revenue

2. Happy customers build a better reputation.

A positive reputation leads to higher growth. Reputation goes a long way in business. It attracts customers, investors, partnerships, and employees. When seeking to improve reputation, start with excellent customer service.

After a positive customer experience, 69% would recommend the company to others.

3. Retention correlates to customer satisfaction.

Customer retention carves the clearest path to business success. Keeping current customers happy results in more stable revenue and more accurate predictions. When you master not just attracting customers, but retaining them, it sets a solid foundation for your entire organization.

And, why is customer service important to retention? 75% of people would return to a company with excellent service.

why customer service is important reason 3 retention

The majority of consumers sight good customer service as a reason for sticking with a company. Beyond product satisfaction or value, customer satisfaction reigns supreme in today’s landscape.

Your unique product or service may reel them in, but customer service keeps them.

4. Churn decreases with more customer care.

Churn measures the amount of customers who leave a business after purchasing. It provides a fairly cut-and-dry measurement of satisfaction. Customers churn when they’re unhappy.

When it comes to churn, the importance of customer service is clear: 89% of consumers begin doing business with a competitor following a poor customer experience.

why customer service is important reason 4 churn

Products have issues. Services have flaws.

But if you can provide a seamless customer service experience, people will be forgiving.

Rather than push them right into the enemy’s arms, focus on excellent customer service to prevent customers from churning.

5. CLTV improves with better customer service.

CLTV (customer lifetime value) reveals the amount of money a customer potentially brings to a company over the course of their engagement. CLTV correlates directly with revenue.

How does it relate to customer service, though?

(For one, it’s got “customer” in the name. And anything involving the customer, involves the customer service team.)

These data points reveal a more specific breakdown: Highly engaged customers buy 90% more frequently, spend 60% more per transaction, and have 3 times the annual value compared to other customers.

why customer service is important reason 5 CLTV

A highly engaged customer refers to one who reads your emails, follows you on social media, and interacts with customer support (whether through individual correspondence or more general blog posts and knowledge base articles).

A good customer service team is involved in all of these mediums. Better customer service means higher engagement, which leads to more dollars spent.

Why we need Agile Project Management Methodology..?

Agile project management provides numerous benefits to organizations, project teams, and products. Key benefits and how to maximize them:

  • Better product quality: Agile methods have excellent safeguards to make sure that quality is as high as possible by

    • Taking a proactive approach to quality to prevent product problems

    • Embracing technological excellence, good design, and sustainable development

    • Defining and elaborating on requirements just in time so that knowledge of product features is as relevant as possible

    • Incorporating continuous integration and daily testing into the development process, allowing the development team to address issues while they’re fresh

    • Taking advantage of automated testing tools in order to develop during the day, test overnight, and fix bugs in the morning

    • Conducting sprint retrospectives, allowing the scrum team to continuously improve processes and work

    • Completing work using the definition of done: developed, tested, integrated, and documented

  • Higher customer satisfaction: Agile project teams satisfy customers by

    • Keeping customers involved and engaged throughout projects.

    • Having a product owner who is an expert on product requirements and customer needs.

    • Keeping the product backlog updated and prioritized in order to respond quickly to change.

    • Demonstrating working functionality to customers in every sprint review.

    • Delivering products to market quicker and more often with every release.

    • Possessing the potential for self-funding projects.

  • Higher team morale: Being part of a self-managing team allows people to be creative, innovative, and acknowledged for their expertise. Having a scrum master removes impediments and shields the development team from external interference. Working cross-functionally allows development team members to learn new skills and to grow by teaching others.

  • Increased collaboration and ownership: The development team, the product owner, and the scrum master work closely together on a daily basis. Daily scrum meetings let the development team organize around work completed, future work, and roadblocks. During sprint reviews the development team can demonstrate and discuss the product directly with stakeholders.

  • Customized team structures: Self-management puts decisions that would normally be made by a manager or the organization into scrum team members’ hands. Because of the limited size of development teams — five to nine people — agile projects can have multiple scrum teams on one project. Self-management and size-limiting mean that agile projects can provide unique opportunities to customize team structures and work environments.

  • More relevant metrics: The metrics agile project teams use to estimate time and cost, measure project performance, and make project decisions are often more relevant and more accurate than metrics on traditional projects. On agile projects, you provide metrics by

    • Determining project timelines and budgets based on each development team’s actual performance and capabilities

    • Having the development team that will be doing the workprovide effort estimates for project requirements

    • Using relative estimates, rather than hours or days, to tailor estimated effort to an individual development team’s knowledge and capabilities

    • Refining estimated effort, time, and cost on a regular basis, as the development team learns more about the project

    • Updating the sprint burndown chart every day to provide accurate metrics about how the development team is performing within each sprint

    • Comparing the cost of future development with the value of that future development, which helps project teams determine when to end a project and redeploy capital to a new project

  • Improved performance visibility: On agile projects, every member of the project team has the opportunity to know how the project is going at any given time. Daily scrum meetings, daily sprint reviews, and visible progress charts offer concrete ways to see progress.

  • Increased project control: The many opportunities to inspect and adapt throughout agile projects allow all members of the project team — the development team, product owner, scrum master, and stakeholders — to exercise control and ultimately create better products.

  • Improved project predictability: Agile project management incorporates several practices, artifacts, and tools for improved predictability:

    • Keeping sprint lengths and development team allocation the same throughout the project allows the project team to know the exact cost for each sprint.

    • Using individual development team speed allows the project team to predict timelines and budgets for releases, the remaining product backlog, or any group of requirements.

    • Using the information from daily scrum meetings, sprint burndown charts, and task boards allows the project team to predict performance for individual sprints.

  • Reduced risk: Agile techniques virtually eliminate the chance of absolute project failure:

    • Developing in sprints, ensuring a short time between initial project investment and either failing fast or knowing that a product or an approach will work

    • Always having a working product, starting with the very first sprint, so that no agile project fails completely

    • Developing requirements to the definition of done in each sprint so that project sponsors have completed, usable features, regardless of what may happen with the project in the future

    • Providing constant feedback on products and processes through daily scrum meetings and constant development team communication, sprint reviews and retrospectives, and releases in which the end user can see and react to new features on a regular basis

    • Generating revenue early with self-funding projects, allowing organizations to pay for a project with little up-front expense.