Could your great service hurt customer loyalty?

August 22, 2011 by Michele McGovern

Posted in: Communications, Customer Service, In this week's e-newsletter, Latest News & Views, New Research

Hard to believe, but great service may actually hurt customer loyalty. The explanation:

All it takes is a little better service from the competition and once-loyal customers will leave, Harvard Business School researchers recently found. In fact, your most loyal customers are the folks who will leave first, the study found.

Why does this happen? Companies that deliver a high level of service create a high expectation for customers. So they almost always crave more, and go elsewhere if another company offers and delivers on it.

Of course, there’s one solid way to avoid losing customers to another company that promises great service: Make sure your service evolves with, or ahead of, customers.

Regularly offer new perks or service upgrades.
Do more proactive service, reaching out to loyal customers before they have to contact you.

Tags: customer loyalty, Harvard Business School

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Ulka Rodgers: Good ideas. It would be even more effective if they actually solved the problem and contacted the customer to follow up....