Digital vs. Personal — What's the Best Way to Communicate With Your Customers? One of the challenges all businesses face is figuring out how much personal support to offer their customers.
By Joseph Camberato Edited by Chelsea Brown
Key Takeaways
- Effective customer service requires a balance of automation and personalization. Automation tools like chatbots are cost-effective and can provide 24/7 support, but too much reliance on them can frustrate customers.
- Personalized customer service ensures you meet customer expectations, creates customer loyalty, drives revenue and helps you understand your customers.
Opinions expressed by Entrepreneur contributors are their own.
One of the challenges all businesses face is figuring out how much personal support to offer their customers. Customer service automation can reduce the rate of human error and enable your company to scale its services more effectively.
Tools like chatbots allow you to provide 24/7 customer support and collect leads your team can follow up on during normal business hours. Plus, it can save your business quite a bit of money on call centers and customer support.
But too much of anything can turn into a problem, and relying too heavily on automation removes the personal touch most customers are looking for. Let's look at how personal interactions can benefit your business and how to find the right mix of automation and personalization.
What is personalized customer service?
Personalized customer service is providing assistance to customers that is tailored to their specific needs and preferences. It's about finding a way to include a human element in each interaction with your customers.
Starbucks was an early adopter of this tactic when the company began having baristas write customers' names on their drink orders. It's a small way to establish a connection between the baristas and the customers and build customer loyalty. It also reduces confusion and ensures the customer receives the drink they ordered.
But even if you never see your customers in person, there are still ways you can create a personalized customer experience. Starbucks also offers personalized drink recommendations and special offers based on a customer's location and order history.
It's also about giving customers multiple ways to contact your business since everyone has their own preferred way of reaching out for assistance. By staying flexible, you can ensure that each interaction with your business is helpful and leaves the customer satisfied.
Related: Want Customers to Love You? Treat Every Customer Like They're Your Only Customer
How personal interactions help your business
Personal interactions help you improve the customer experience and drive more growth in your company. Let's look at the biggest benefits of providing personalized customer service.
Ensures you meet customer expectations
The pandemic raised the bar for what customers expect from the companies they do business with. Over 50% of customers say that the experience they have with a company is as important as the products and services offered.
According to data from McKinsey, 71% of customers expect personalized interactions with businesses, and 76% feel frustrated if they don't happen. This is true whether you run an online store or a brick-and-mortar business. In many ways, personalization has become the minimum bar you need to meet just to get customers in the door.
Creates customer loyalty
Having meaningful interactions with your customers is the best way to create customer loyalty. Loyal customers will continue doing business with you again and again and are more likely to recommend your company to their friends and family.
Loyalty customers have a higher lifetime value than a one-off customer. Alternatively, customers are unlikely to purchase from you again if they don't feel like their opinions were heard or the issue was resolved.
Plus, businesses that effectively use personalization will stand out from their competitors. Personalization helps you build loyal customers and create more sustainable revenue for your business.
Drives more revenue
Data shows that companies that incorporate personalization drive more revenue, both from new and existing customers. The McKinsey report found that fast-growing companies drive 40% of their revenue from personalization. Plus, because you're targeting your customers more effectively, you can better control your market spend.
Helps you understand your customers
There's only so much you can learn about your customers by collecting demographic data and segmenting them into different email lists. By interacting with customers directly, you'll learn more about what they want from your business as a whole. You'll learn what they like and don't like about your products and services and how you can make them better.
Related: 3 Ways Founders Can Connect With Their Customers to Drive Sales
The importance of balancing automation and personalization
Have you ever needed to contact customer support but were unable to get anyone on the phone? No matter what you did, you couldn't seem to get past the automated messages and speak to a real person.
This is the problem with relying too heavily on automation — it makes customer interactions feel inauthentic and frustrating. Technology can be an excellent way to keep up with the demands of a growing business, but some problems require human interaction and support.
That's why after 18 years, Facebook is finally building a customer service division. Members who were having their posts or accounts removed unexpectedly were unable to fix the problem due to the company's lack of customer support.
For most companies, automation and personalization go hand-in-hand — using them together is the best way to streamline your processes and grow more efficiently. How much human interaction you provide to your customers will depend on the type of business you run. However, adding a personal element to customer interactions can be a great way to grow, build and scale your business.
