Customer service has often been viewed as a cost center, so management techniques focus on efficiency and cost controls. But this is an increasingly outdated view. Customer service represents a critical component of the overall customer experience, a touchpoint that can increase or decrease loyalty.

So I want to start by giving a shout out to companies that are delivering consistently excellent customer service. I'll then move on to discuss how customer service links to customer experience and what companies need to do to excel at customer service.


2012 Temkin Customer Service Ratings

We just recently announced the 2012 Temkin Customer Service Ratings that examines 174 companies across 18 industries based on a survey of 10,000 U.S. consumers. Congratulations to these overall customer service leaders:

  • Publix
  • Hy-Vee
  • Credit unions
  • Chick-fil-A
  • H.E.B.
  • Sam's Club
  • Winn-Dixie
  • ShopRite
  • Aldi
  • Starbucks
  • Giant Eagle
  • JCPenney

All of these leaders except for credit unions come from the grocery, fast food, and retail industries. It turns out that these industries have the highest average ratings. At the other end of the spectrum, with the lowest overall ratings, are Internet service providers and TV service providers.




As you can see from the chart, there's a difference across industries. But there's also a pretty wide gap of scores within each industry. So it's good to recognize the companies that most outperformed their industry peers:

 Credit unions (20 points above banks)

  • Kaiser Permanente (17 points above health plans)
  • Bright House Networks (16 points above TV service)
  • American Express (15 points above credit cards)
  • Chick-fil-A (14 points above fast food chains)
  • USAA (14 points above banks)
  • PNC (13 points above banks)
  • Southwest Airlines (13 points above airlines)

Customer Service is on the Rise

We also looked at the change in Temkin Customer Service Ratings between 2011 and 2012. There's good news for customers. Led by computer makers, health plans, and banks, 10 of the 12 industries that were included in both years showed an increase.

Improvements were pervasive. Seventy-five percent of companies that were in the 2011 and 2012 Temkin Customer Service Ratings showed improvement. Fifteen organizations improved by at least 10 percentage points, with these five firms leading the way with improvements of at least 20 percentage points: 

  • PNC
  • Gateway
  • Toshiba
  • Farmers
  • HSBC

Customer service is a part of the overall experience

I am often asked: "How is customer service different from customer experience?" Customer service is an organizational function, like marketing or sales, that manages a subset of interactions with customers. Customer experience, on the other hand, is the connection that companies make with their customers across all functions and touchpoints. I like how Jeff Bezos,'s CEO, has described the difference:

"Internally, customer service is a component of customer experience. Customer experience includes having the lowest price, having the fastest delivery, having it reliable enough so that you don't need to contact [anyone]. Then you save customer service for those truly unusual situations. You know, I got my book and it's missing pages 47 through 58."

Here's a definition that I use for customer experience: The perception that customers have of their interactions with an organization. So customer service represents a subset of interactions that collectively create the customer experience.

Customer service, however, can have a disproportional affect on how customers view a company. These interactions often deal with customers who are upset, disappointed, or otherwise emotionally charged. In these situations, a great experience can create lasting loyalty. On the other hand, a bad experience can sour a customer for life.

Make Sure Your Customer Service C.A.R.E.S.

Since customer service can have such a lasting effect on customers, it's important that they deliver consistently good (if not great) experiences. How can they do this? By focusing on all five parts of what we call the CARES model:

  • Communication: Clearly communicate the process and set expectations.
  • Accountability: Take responsibility for fixing the problem or getting an answer.
  • Responsiveness: Don't make the customer wait for your communication or a solution.
  • Empathy: Acknowledge the impact that the situation has on the customer.
  • Solution: At the end of the day, make sure to solve the issue or answer the question.

If companies focus on these areas, then customer service ratings will continue to rise which will help to improve the overall customer experience.