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  • Eric Choronzy

5 Ways Franchise Owners Can Better Understand The Value Of Great Customer Service

Updated: Jul 15, 2021

As franchise owners, we’re tasked with keeping tabs on just about everything under the sun in order to run a healthy operation. HR, marketing, sales, operations, facilities, the list goes on.. You can crunch numbers all day long or build the best strategy out there, but nothing compares to great customer service, for various reasons. Here’s a hot take on 5 reasons why rock solid customer experience is so important.




1. The Obvious: Customer Retention


This may seem like a no brainer, but there’s more to be said here. Keeping loyal customers is far less expensive than gaining new customers. Research shows that it costs about five times more to attract new customers than it does to retain existing business. Obviously you have to strike the balance of prospecting for new customers and effective lead generation efforts, but satisfied customers become devoted customers when a business is trustworthy and provides exceptional customer service. Franchise owners in the service, health and wellness, restaurant business (and many more) know this best. The LTV (lifetime value) of that customer far outweighs multiple one-off purchases if you can keep them coming back.


2. Competitive Advantage


Today’s consumer market is more saturated than ever before. Buyers have choices; a lot of them! You may have a flashy logo, or great branding, but the optionality presented to consumers and the ease of switching to something else is easier than ever before. Great customer service not only establishes a trusting relationship, but keeps customers around and builds a sound community. There’s a reason more and more brands focus their efforts on building communities. Getting people to feel that sense of belonging builds stronger bonds and creates advocates for your business. As we all battle against churn, and customer retention in this competitive landscape, this is an obvious way to soften the blow. Provide excellent customer service and win market share from those who don’t.


3. Brand Advocates = your best (and cheapest) lead generation.


Positive endorsements and online reviews are arguably the most important thing you can have for your business. Using the above example with the saturated and competitive marketplace, where do people turn to first when looking for a new product or service? Reviews, case studies, testimonials, google, etc. With all the great marketing out there, that can sway people in ways we thought we couldn’t be swayed, we always trust our peers and their experiences first. As Walt Disney so brilliantly said,


“Do what you do so well that they want to see it again and bring their friends”.


4. Prevents Business Failure / Interruption


The unfortunate truth is that about 96% of small businesses close their doors within 10 years. One of the major contributing factors happens to be poor customer service. We’ve all been there before. We made a purchase, or entered into a service agreement and had the worst experience ever. We vowed to never go back there again. They lost our business. That bad taste isn’t going away. Also said best by Warren Buffet:


“It takes 20 years to build a reputation, and 5 minutes to ruin it”.


5. Reduces Employee Turnover


Employees want to work for businesses that appreciate worker contributions, encourage new ideas, and treat customers fairly. In today's extremely challenging labor market this is more crucial than ever. Statistics show that when people work for an employer who provides great customer service, they’re more engaged in their work and they themselves become advocates for the business.


Be Human. Be Kind. Treat people fairly. And the rest will follow.


For more dialogue and conversation around strategies, ideas, and best practices for franchise owners, join our franchise community at www.franchisecommon.com where we contribute to the mission of support, community, peer-to-peer learning, and knowledge from our other bright minded members.



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