What is Customer Relations? Everything You Need to Know

January 24, 2021

Developing an amazing product is one of the hardest challenges that a company can overcome — but it's not the only factor that will determine the success of a business. Today's consumers have more industry influence than they've ever had in the past, allowing them to focus on more than just the product that you're selling them.

Now, consumers are interested in what you're selling them, how you're selling it, and what happens after you've sold it to them.

The shift has placed pressure on companies to invest in their customer service teams and meet rising customer demands. In fact, a 2018 study showed that 59% of consumers have higher expectations for customer service than they did in 2017. Businesses are now facing the challenge of creating an excellent customer experience that's consistent across every interaction.

To achieve this, many companies are now focusing on how they manage their customer relationships. Building strong customer relations is a great way to develop customer loyalty and retain valuable, long-term customers. If you're looking to improve customer relationships at your company, it helps to understand what successful customer relations look like and how you can create them with your clientele.

Customer relations is present in all aspects of a business, but it's most prevalent in the customer service department. Customer service teams, customer support, customer success, and product development all play important roles in building a healthy customer relationship. Customer relations also extend to marketing and sales teams as well since these departments have a significant influence over the company's interactions with the customer.

What functions does customer relations include?

Customer relations includes both the reactive and proactive functions performed by your customer service teams. Reactive functions are the efforts made by your team to solve issues that are reported by customers. This includes tasks like responding to customer complaints and solving problems with the support team. Being able to solve unexpected customer roadblocks is essential for brands that are looking to build strong customer relationships.

Proactive functions are the measures taken to ensure a long-term relationship with customers. These efforts are aimed towards fostering customer success by consistently satisfying evolving customer needs. Customer success teams do this by providing information about products and updates as well as by promoting discounts and exclusive offers. This type of long-term customer relationship management helps companies create lasting impressions on customers who eventually become loyal to the brand.

Customer Service vs. Customer Relations

You may think they're one and the same, but customer service and customer relations are two very similar concepts with one distinct difference. Customer service is what your company provides to ensure customer success. It is an inbound function that's now expected by customers at the first point of interaction with your business. Companies can provide proactive customer service features, but most customer service functions are delivered in response to customer action.

Customer relations differs because it consists of both the inbound and outbound measures taken by your company. It considers your organization's ability to react to present issues as well as your approach to bettering future experiences. Customer relations focuses on the proactive steps you're taking to engage customers and improve the customer experience.

Customer relations encompasses all of the important functions that customer service performs, but also includes the efforts made before and after customer interactions. While responding to immediate customer needs is a great way to provide excellent customer service, searching for solutions to future roadblocks is how your company can build positive customer relations.

Benefits of Positive Customer Relations

Positive customer relations can result in an array of benefits for your company including more potential leads and higher customer retention rates. To narrow it down, here are the top three benefits that positive customer relations can provide for your company.

Customer Retention

Companies that do a better job of managing customer relations are more likely to see higher customer retention rates. In fact, studies show that 61% of customers stop buying from a company if they have a poor customer experience.

Customers know when your company is being genuine and are willing to overlook your mistakes so long as you demonstrate a dedication to their success. That type of transparency is essential when reducing churn as well as when you're building a positive customer relationship. It can also be financially beneficial too, as studies show increasing customer retention rates by just 5% can increase your profits by 25% to 95%.

Customer Loyalty

When you have a good history with your customers, it makes it more difficult for your competitors to lure people away from your brand. Customers loyalty is highly valuable for businesses as repeat customers are more likely to buy from you than leads that have not yet converted. Building positive customer relations drives customer loyalty because it creates an intangible incentive for the customer to return to the same business. thinkJar Research even shows that 55% of consumers will pay more money for a product or service if it's a guaranteed good experience. While it may cost more for companies to invest in building positive customer relations, the payoff in customer loyalty can be instrumental for generating consistent revenue over time.

Customer Satisfaction

Often times it can be hard to tell whether your customers are truly happy with your business or not. In fact, 91% of unhappy customers who don't complain simply don't return to a company for another purchase. Having strong customer relations can act as your insurance policy for preventing these unidentified customers from churning without warning.

Positive customer relations give companies more insight into their customer's problems because it creates an open channel of communication for relaying customer feedback. This leads to better individual interactions with customers which builds up trust over time and influences their buying decisions. Studies have even found that consumers believe that a good experience with a company has more influence over their purchase decision than advertising does. So while the commercial of the cute dog may get a smile or two from your target audience, customer satisfaction actually is the result of your brand creating memorable customer experiences.

Every company should aim at building positive customer relations but hitting your target can be a lot easier said than done. It takes a complete effort from the entire company to build a long-lasting and trustworthy customer relationship. In the next section, we break down some of the important components needed for fostering positive customer relations at any company.

Building Positive Customer Relationships

Since customer relations considers all of your customer interactions, there are a lot of factors that can influence a customer relationship. When building positive customer relations, organizations need to take a company-wide approach that's focused on promoting customer success. To do that, here are three key factors that any business should consider when pursuing positive customer relations.

1. Invest in employee training.

A great customer experience comes not only from the product being sold but also from the employees who interact with the customer. Your reps must be highly skilled in their trade and motivated by quickly solving customer problems.

Customer service training may include developing some of the "soft" skills such as improving active listening, developing a professional communication style, and how to solve problems efficiently in your organizational framework.

While you might expect your reps to have these skills when you bring them on, continual training helps align the entire team to your organization's brand standards, policies, and procedures, resulting in a more consistent experience across the board.

2. Create a fulfilling workplace for your customer service reps.

Richard Branson of Virgin Airlines famously said, "If you take care of your employees, they will take care of the clients." This seems intuitive: If a customer service rep is having a bad enough day that the customer perceives this, it can change the tone of the experience.

Studies have also shown that happy workers are also 13% more productive, and in the service world, productive reps and quicker resolution times lead to higher rates of customer satisfaction.

3. Improve first call resolution rate.

86% of customers will pay more for a better experience, and great customer experiences are becoming the norm in today's marketplace. One of the metrics to look at when creating a frictionless service model is first-call resolution (FCR). FCR refers to the percentage of calls that get resolved with no follow-up or additional touchpoints needed.

It's a critical metric that improves satisfaction (no one wants to call multiple times about one issue, and more calls equate to more frustration) and your team's internal efficiency. The more calls that are resolved completely, the less your system is taxed by call volume.

Your service and support teams should be equipped and enabled to handle the majority of issues that customers present.

4. Leverage software to increase efficiency.

Speaking of enablement, companies faced with higher volumes of support and service cases should consider adopting customer service tools to help manage customer relations. Adding a help desk software can significantly help customer service, support, and success teams monitor interactions with customers over time. Tools like a customer relationship manager, or CRM, can help your team expand its bandwidth and create satisfying experiences for every person that interacts with your business.

5. Create opportunities for self-service.

You may not have the bandwidth to provide on-demand one-to-one support at all hours of the day. Ensure that you're providing the tools for your customers to get help when they need it, even without the help of a rep.

Chat bots can help disseminate information and guide website visitors to the right areas on your website. Knowledge bases can address some of the most common questions customers have.

Even though some customers will prefer calling in, these simple steps can address the problems of your more self-sufficient customers and increase satisfaction by continuing to solve problems on demand.

6. Be accessible.

That isn't to say that you should replace reps with self-service solutions altogether. To provide an excellent customer experience, your service and support teams need to be readily available to help. A Microsoft survey revealed that over a third of consumers reported that their biggest complaint with a company is not being able to get help from an agent when needed to.

While it helps to have things like self-service help desks, your team still needs to be there when the customer has a problem. Technology can help ease some of the stress for your customer service team, but it can never recreate the memorable experience that a live rep can provide. This human interaction is crucial to creating a meaningful relationship between a company and its customers.

7. Show appreciation.

Part of creating a great customer experience is providing small moments of delight where you exceed their expectations. This is particularly important as our culture is shifting away from brand loyalty and more toward loyalty to the brands that provide the best experience. Consider rewarding your best customers with a loyalty program or other small token of your appreciation.

8. Measure and improve customer satisfaction.

Making your customers happy doesn't have to be an intangible effort. Ask for feedback from your customers and develop a system for measuring that feedback. This could be in the form of customer satisfaction surveys and NPS scores.

If you do, also ensure that you're committed to acting on the feedback you receive. As you see scores improve and feedback get better, you know you're on the right track.

9. Create a customer-first culture.

Companies that want to create positive customer relations need to install a customer-centric culture into the organization. This culture has to be focused on customer success as well as creating long-term solutions for every customer. Companies can do this by creating a customer journey map that outlines the buyer's journey for a target consumer. Employees will be more motivated to help customers as they can see exactly where they play a role in the customer's success. It also helps to hire a customer relations executive who can lead the development of customer relationships.

Start listening to what your customers have to say and remove the points of friction that cause dissatisfaction. A great customer service and retention program doesn't happen on its own. Creating a thoughtful customer experience based on your ideal buyer begins with strategy.

Editor's note: This post was originally published in March 2019 and has been updated for comprehensiveness.

Source: What is Customer Relations? Everything You Need to Know

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