3 Ways Social Media Customer Service Impacts the Bottom Line

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March 9, 2018

By Ashley Cooksley

Great social media customer service has a strong impact on a business’ bottom line. Done well, it means customers will spend more, it improves efficiency and it generates data that you can use to improve services and benchmark against your competitors. Done poorly, and you will be faced with spending precious resources digging your brand out of a hole.

Research published in Harvard Business Review found that customers who received a response to their query on social media were more likely not just to remain a customer, but to spend more money with the brand, and recommend it to others. And research from Sprout Social shows that answering a customer’s question on social media prompts 49% of consumers to purchase.

But delivering that exceptional customer service on social media means understanding (and focusing on) three fundamental areas: consumers’ expectation of a fast response and resolution time; the inexorable rise of chat bots and artificial intelligence in improving efficiency; and the ability to mine data to gain insight into what customers want.

  • Trend No. 1: A rapid response is now standard.
  • Facebook Messenger, already widely used for customer service, is setting the standard for response times on social media. Unless a brand replies to 90% of queries, and—crucially—does this within 15 minutes (something we at The Social Element have been advising brands to include in their crisis plans for years), it won’t get the coveted fast responder status from Facebook, and it could, potentially, lose customers to those brands that respond quickly.

    The demand for rapid response is only going to increase in 2018: In its second-quarter-2017 report, Sprout Social found that 48% of respondents valued a quick response on social media above any other action a brand could take.

    Brands have a lot of work to do to meet these expectations. According to Sprout Social, the average brand response rate is just 12%. On average, a response takes 11 hours. That’s a long way short of the Facebook-recommended 15 minutes, and a lot of potential sales lost.

  • Trend No. 2: Bots and humans must work together to improve efficiency, but not at the cost of satisfaction.
  • Forrester Research predicts that blended AI tools will “help improve sales outcomes and reduce customer-servicing costs.” But there’s a flip side. Forrester also says that this could lead to a decrease in customer satisfaction as brands adapt their customer-service offering to work with chat bots.

    That’s a challenge for brands. Bots will undoubtedly help in the quest for faster response times, sifting out more mundane queries and providing automated responses. But if brands don’t ensure the quality of that response, the price of speed and efficiency will be dissatisfaction.

    It’s a fine line to walk. Bots may help with basic queries, and that will free up time for humans to do what we do best—build relationships and delight customers. We need the intelligence of humans to respond engagingly and to deal with detailed or complex queries. Our view is always that bots power human engagement, and nowhere will that be clearer than in delivering social media customer service.

  • Trend No. 3: Customer service data matters.
  • Social media customer service can deliver more than just a happy customer. It can create valuable data that will give you insight into what your customers want. Analyzing the data can highlight things like product or service issues, common problems or regional differences in customer demand. You can spot patterns in customer behavior that could be invaluable in informing your strategy.

    Insights based on that data let you make data-led decisions on everything from product development to customer-service strategy. And you can benchmark your performance against that of your competitors to ensure that you’re staying a step ahead.

In summary, social media customer service isn’t an optional extra anymore. It’s a differentiator, a sales generator and a boost to profits. No wonder 2018 is the year that brands are investing in great social media customer service.

Ashley Cooksley is chief marketing officer at social media agency The Social Element.

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