Top Ways Bad Customer Service Can Ruin Your Brand's Reputation

When companies allow customer service to deteriorate, it will negatively affect brand identity in numerous ways. The effect of customer and business opportunity losses from poor customer service are only the beginning of long-term challenges. The fact is that the damage to brand identity has much bigger implications for sending those challenges into an ever-expanding spiral.

The Dimension Data 2017 Global Customer Experience (CX) Benchmarking Report found that 71 percent of organizations cited customer experience as a competitive differentiator. Despite this statistic, many businesses are unable to see how poor call center performance can really affect the bottom line.

Whether it is poor call center training and monitoring, inefficient technology support, high turnover, or any number of other challenges that plague the call center, they all add up to poor customer service. Businesses should never make changes out of fear, but proactive customer service improvements can be spurred by these 5 ways that bad customer service can ruin your brand identity.

1. Loss of Reputation Leading to a Cycle of Dwindling Profits

In the age of social media, mobility, and multi channel touch points, it only takes one bad customer service encounter to cascade into a reputation firestorm. If the problem is more widespread such as poor agent training or problem-causing technology, it will quickly lead to a downward spiral of profits.

It starts with new sales and quickly spreads to loyal customers leaving. Damage control for the brand will only slow the decline temporarily without addressing the problems at the source. In the end, businesses will spend and lose a great deal more correcting the problem reactively than proactively.

2. A Single Employee Mistake Can Become the Face of the Brand

A single front line incident such as the death of an English bulldog put in an overhead bin by a United Airlines employee can take over and drive global brand identity. Whether poor policy, training, or processes that caused the problem, it doesn’t matter after the fact. The damage is already done. While this is an extreme example of poor customer service, the telltale signs that lead to an incident of this magnitude are hiding just beneath the surface.

This is why gathering and analyzing call and encounter data through the use of robust call center metrics is so important. First call resolution, service level/response time, and customer satisfaction all show patterns that can be traced to practices, processes, systems or training problems that can be corrected before a fatal brand encounter. By implementing proactive customer issue monitoring based on metric analysis, the contact center can improve agent performance and proactively head off customer service challenges that might impact the brand.

3. Poor Brand and Reputation Impacts Candidate Quality Pool

The effect of bad customer service on the brand can manifest in the caliber of employees that you have to choose from. Just as your reputation for poor customer service can spread, the negative effects of employee morale and attrition can spread as well. If your company develops a bad reputation, your top performers may also jump ship when they realize things are going south.

4. Poor Customer Service Begets Poor Brand identity that Impacts Customer Price Sensitivity

Poor customer service makes customers and prospects more sensitive to price. This goes beyond businesses that are subscription-based to businesses where customer encounters are stand-alone. In all cases, poor customer service makes customers think twice about pricing and any potential price bump. The statistics show that the majority of customers will pay more for a service in order to receive better customer service, and the opposite is also true.

4. Poor Customer Service Leads to Poor Brand Identity and an Inability to Improve the Business Model

The damage to brand identity due to poor customer service can happen gradually, since most customers that have a bad encounter won’t complain, they will just leave. Consequently, you’ll miss out on a chance to improve your customer service model. Without this knowledge, businesses can make poor brand decisions that further degrade the brand and the bottom line.

5. Disengaged Employees

Your brand affects the company internally as well as externally, so poor customer service that negatively impacts the brand can lead to higher complaint rates. This takes its toll on the employees who have to deal with upset customers.

The result is that employee morale and engagement become a growing problem, which leads to high attrition rates and inadequate staffing, causing the problem to spiral further out of control. While managed staffing can be an important tool, it is most effective when the internal employee support network is strong.

Conclusion

In the end, customers and prospects don’t know or care about what may be happening in the background of a contact center, but they will always equate your service with your brand. A poor customer service encounter won’t make them think less of your company’s customer service department, but rather of the company itself.