employee helping customers after a service failure by the airline

Service Recovery – 8 Reasons to Include it in Your Customer Service Strategy

Successful organizations understand the importance of providing outstanding customer service. However, even the most stellar companies can have service mishaps. While every effort should be made to prevent customer service failures, they can happen to the best of us. What is essential is to have consistent protocols to make things right – swiftly and completely. These resolution protocols make up what is known as a “service recovery.” Before we go over why having a service recovery strategy is so important, let’s take a moment to define what service recovery is. 

What Is Service Recovery?

Service recovery refers to the actions and processes a business or organization employs to address and resolve customer complaints, issues, or problems that arise during or after the delivery of a product or service. A service recovery aims to restore customer satisfaction, loyalty, and trust, even when something has gone wrong in the customer experience. 

Service failures can take various forms, ranging from product defects and poor customer service to delays and late deliveries –  or any other aspect of a service or experience that does not meet the customer’s expectations. Service recovery is about making things right for the customer, and it requires a well-coordinated effort by the business or organization to restore the customer’s confidence and trust. It involves training and empowering customer-facing employees to:

  • Listen to the customer’s complaint
  • Empathize with the customer’s situation
  • Apologize to the customer for their negative experience 
  • Take prompt and appropriate action to rectify the problem. 
  • Follow up to make sure the issue has been resolved 
  • Compensate the customer for the inconvenience 

Why is Service Recovery Important?

As Donald Porter, the former Vice President of British Airways, once said, “Customers don’t expect you to be perfect. They do expect you to fix things when they go wrong.” It’s true that no matter how good your service is, mistakes can happen! However, what matters most is how you handle them. Ignoring or neglecting an issue could have negative consequences that could damage your business’s reputation, whereas acknowledging customer complaints promptly and resolving them completely can make all the difference. It can turn a dissatisfied customer into a loyal one and even bring you positive word-of-mouth advertising – which, as we know, is worth its weight in gold! 

Advantages of Implementing a Service Recovery Strategy

Research done by Salesforce reveals that If the company’s customer service is excellent, 78% of consumers will do business with them again – even after a mistake. This is why successful businesses have a service recovery strategy as part of their overall customer service strategy. Let’s explore some of the benefits of creating and implementing a service recovery plan:

1. Repairing Customer Relationships – When customers encounter problems or have negative experiences with a product or service, their initial dissatisfaction can lead to frustration, disappointment, and, potentially, a decision to take their business elsewhere. Effective service recovery efforts can help repair the relationship with the customer, ensuring they continue to do business with the organization.

2. Increasing Customer Retention – Acquiring new customers is typically more costly and time-consuming than retaining existing ones. Service recovery is a means of maintaining valuable customers who may otherwise be lost due to a bad experience. Loyal customers tend to make repeat purchases and can become advocates for the business.

3. Enhancing Business Reputation – In today’s digital age, customers have a powerful voice through online reviews, social media, and word-of-mouth. Unresolved customer complaints can quickly spread and damage a company’s reputation. Conversely, effective service recovery can lead to positive reviews and recommendations, improving the organization’s image.

4. Learning and Continuous Improvement – Service recovery allows organizations to learn from their mistakes and identify areas to improve their products, services, or processes. By addressing the root causes of problems, businesses can prevent similar issues from occurring in the future. Providing relevant customer service training across all departments can help reduce the number of service mishaps or failures.

5. Gaining a Competitive Advantage – Businesses that excel in service recovery can gain a competitive edge. Customers are more likely to choose companies that are known for resolving issues promptly and to their satisfaction. This can help differentiate a business in a crowded market.

6. Expanding Customer Feedback – Service recovery often involves gathering customer feedback about their experiences. This feedback can be invaluable in identifying recurring problems and strategically improving business operations.

7. Adhering to Legal and Regulatory Compliance – In some industries, effective service recovery is not just a matter of customer satisfaction but also a legal or regulatory requirement. Failure to address specific issues can result in legal consequences or fines.

8. Boosting Employee Morale – Employees trained in and empowered to participate in service recovery methods that genuinely make a difference in retaining customers will have higher job satisfaction. This can lead to improved employee morale and a more motivated workforce.

In today’s world, service recovery is not just an option but a necessity for businesses that aim to succeed. It is a powerful tool that can help retain customers, safeguard an organization’s reputation, and enhance the quality of products and services. By demonstrating a solid commitment to customer satisfaction and taking prompt and effective action to address any problems, you can continue to earn the trust and loyalty of your customers for the long haul.

Additional Resources:

The Financial Cost of Bad Service (Free eBook) 

Customer Service Training: 4 Reasons Why You Need it for All Departments

Top 9 Customer Service Metrics to Measure

Customer Service and Your Online Reputation

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Customer Service Institute of America