Customer Service Experience: Top Five Strategies and The Role of AI

Before diving into this blog, a question — as a consumer, would you rather have an amazing product with terrible customer service or a decent product with exceptional service?   

Let's be real: it's a no-brainer. If you've had a bad experience with a brand's customer service, you'd hesitate before recommending it to anyone. But if it's great, you'll rave about it to your friends and family without a second thought.   

Businesses know that customer service experience directly impacts bottom line. Yet, they still struggle to consistently deliver positive experiences for a variety of reasons, losing customers along the way — even when their products are top-notch.

In this blog, we'll discuss the key elements of a great customer service experience, why it matters, and strategies for ensuring consistency. We'll also explore the growing role of AI in transforming customer service.

What is customer service experience? 

Customer service experience is all about how customers feel when interacting with your company's support — before, during and after buying a product or service. It includes every customer touchpoint — whether with your sales team, support reps or service agents. And here's the kicker: the quality of the customer interactions defines how customers perceive your brand.  

Delivering exceptional customer service is essential for business success in today's marketplace, where product differentiation is becoming less significant. Understanding your customers' needs and consistently meeting or exceeding their expectations can create a positive service experience that turns one-time buyers into loyal, satisfied customers. 

How customer service experience impacts business operations 

When customers have a great experience with your service, they’re more likely to come back for more, recommend your brand to others and leave glowing reviews. That kind of customer loyalty doesn’t just boost your reputation — it drives sales, too.   

Take Walmart, for example. Their customer-centric approach shines through in their efficient pickup points and seamless omnichannel customer experiences. They’ve set the bar high for smooth operations and built an unshakeable brand presence. So, when Statista reported that in 2023, Walmart welcomed around 240 million customer visits per week and their loyalty program Sam’s Club raked in $2.6 billion from membership fees, we weren’t surprised. 

What is the importance of customer service experience?

The importance of the customer service experience cannot be underestimated. This section briefly outlines its benefits and how it impacts an organization's brand value.   

Increases customer loyalty   

A positive customer service experience increases customer satisfaction and boosts customer loyalty, evidenced by high net promoter scores (NPS). A survey by Statista revealed that 94% of customers would purchase from the same brand if they had a positive service experience. This demonstrates the significant impact of customer service experience on brand loyalty.    

Improves customer retention 

Superior customer service turns one-time buyers into loyal customers, boosting customer retention and attracting more business. Ritz-Carlton, for example, is known for its exceptional customer service. The hotel chain empowers employees to spend up to $2,000 to resolve any guest issue, demonstrating a deep commitment to customer retention. Amused?

Learn 22 Customer Retention Strategies for 2024 

Enhances brand reputation 

Excellent customer service builds your brand's reputation, which sets you apart in a competitive market. For example, Apple has cultivated a loyal customer base through its exceptional customer service and support, making it the world's most reputed and valuable brand. 

Key elements of good customer service experience 

A positive customer experience depends on a few key elements. Let’s check them out.   

1. Good communication: Effective communication in customer service involves listening actively and providing clear, accurate information, which enhances the customer experience.  
2. Pleasant interactions: Positive customer interactions are marked by courtesy, empathy and genuine concern. They ensure customer retention and loyalty.  
3. Timely problem-solving: It is crucial to resolve customer issues promptly. Quick solutions drive high satisfaction, as exemplified by Amazon's efficient return process.  
4. User-friendly support interfaces: Providing customers with easy-to-use support channels, such as intuitive websites, mobile apps and live chat options enhances the overall service experience.    

Examples of effective customer service 

Look at the examples below to learn how effective customer service can build strong customer loyalty and enhance brand reputation. 

• Southwest Airlines: Southwest Airlines’ customer service team went above and beyond for a passenger who approached a gate agent to air his concerns about flight delays. After that, the airline did everything possible to expedite the customer’s journey. They allowed him to board early and even gave him a $200 voucher for a future flight. This incident indicates how brands can gain loyal customers by handling complaints promptly. 
• Chick-fil-A: A Chick-fil-A employee in Alabama saved a customer and her family during a storm by offering them free food and shelter in the restaurant. The customer wrote about her experience on Facebook, and the post was shared over 13,000 times. This incident showcases how going the extra mile for your customers can turn them into brand advocates. 

Top 7 metrics to measure customer service experience

Measuring key metrics is essential to understand and quantify customer service experience. These metrics provide insights into service performance:  

1. Customer satisfaction score (CSAT) 

The CSAT measures customer satisfaction with a company’s products or services. It’s typically assessed through customer surveys, which ask customers to rate their experience on a scale of 1 to 5. 

Must Read: Top Techniques to Measure Customer Satisfaction [+Role of AI] 

2. Customer effort score (CES)  

The customer effort score (CES) is a crucial metric that provides insights into the ease or difficulty of customer interactions with your company. Whether it's resolving an issue, making a purchase, or seeking information, CES focuses on the effort customers need to exert. This understanding is key, as it can influence customer satisfaction and loyalty.   

To calculate CES, you can typically ask customers a straightforward question like: 

"How easy was it to resolve your issue today?"

Customers then rate their experience on a scale of 1 to 7, where:  

• 1 = Very difficult  
• 7 = Very easy  

Once the responses are collected, you calculate the average CES by adding all the scores and dividing them by the total number of respondents.  

Let’s say you surveyed 5 customers whose responses were: 7, 6, 5, 6 and 4.  

Add up the scores: 7+6+5+6+4=28  

Divide by the number of responses: 28÷5 = 5.6  

In this case, the CES is 5.6. A higher score means less effort is required from the customer, which indicates a better overall experience.  

Note: Companies with lower CES tend to have higher customer loyalty, as customers appreciate not jumping through hoops to get things done. 

3. Net promoter score (NPS) 

NPS measures customer loyalty by asking how likely customers are to recommend the company to others on a scale of 0 to 10. Respondents are categorized as promoters (9-10), passives (7-8) or detractors (0-6). A higher NPS indicates stronger customer loyalty and a positive experience. 

For example, if out of 100 respondents, 60 are promoters and 20 are detractors, 

Percentage of promoters = 60/100 × 100 = 60% 

Percentage of detractors = 20/100 × 100 = 20% 

NPS = 60% − 20% = 40% 

Read More: How to improve the Net Promoter Score of your brand

4. Customer churn rate 

Customer retention rate (CRR) is a key metric that measures the percentage of customers you retain over a given period. It reflects your ability to maintain your customer base, which is essential for long-term growth. A high retention rate often indicates customer satisfaction, brand loyalty and effective customer engagement strategies. 

To calculate CRR, you need three key figures: 

E = The number of customers at the end of the period. 

N = The number of new customers acquired during the period. 

S = The number of customers at the start of the period. 

Compare your performance against your peers: Average Customer Retention Rate by Industry 

5. First response time (FRT) 

First response time (FRT) measures a company's average response time to respond to a customer's initial inquiry. A lower FRT is preferable, indicating that the company is prompt in addressing customer concerns, which enhances the overall customer experience. 

Imagine a customer support team that handles inquiries via email. Here is a sample dataset for a day's worth of inquiries: 

1. Inquiry received - 09:00 AM, first response sent - 09:15 AM  
2. Inquiry received - 10:30 AM, first response sent - 11:00 AM  
3. Inquiry received - 11:45 AM, first response sent -12:00 PM  
4. Inquiry received - 02:00 PM, first response sent - 02:10 PM  
5. Inquiry received - 03:30 PM, first response sent - 04:00 PM  

Calculation steps 

Determine the time taken to respond to each inquiry first.  

Inquiry 1: 15 minutes 

Inquiry 2: 30 minutes 

Inquiry 3: 15 minutes 

Inquiry 4: 10 minutes 

Inquiry 5: 30 minutes 

Sum the times to the first responses: 15+30+15+10+30=100 minutes  

Total number of inquiries: 5 

So FRT=100/5= 20 minutes 

If your customer support team has an average FRT of 20 minutes, customers typically get a reply to their initial inquiry within 20 minutes of contacting your team. 

A lower FRT indicates that the company is quick to acknowledge and address customer concerns. A quick first response can improve customer satisfaction and demonstrate a commitment to providing excellent service. 

6. Average resolution time  

Average resolution time tracks the average time taken to resolve customer issues from when they are reported until resolved. A lower average resolution time signifies efficient problem-solving capabilities, contributing to a better customer experience. 

7. Customer lifetime value (CLV) 

Customer lifetime value (CLV) is a metric that estimates the total revenue a business can expect from a single customer over the entire duration of their relationship. It helps businesses understand the long-term value of acquiring and retaining customers. A high CLV means the customer is likely to contribute significant revenue over time, making them more valuable to the company. 

There are different ways to calculate CLV depending on the business model, but a common and simplified formula involves three key variables: 

• Average purchase value (APV) = Total revenue generated divided by the number of purchases.  
• Average purchase frequency (APF) = The number of purchases made in a given time period (usually a year).  
• Customer lifespan (CL) = The average time customers continue buying from the company (in years). 

Five key strategies to provide great customer service experiences 

Providing superior customer service experience is crucial for any business. Here are five key strategies to ensure your customers are satisfied: 

1. Ensure a customer-first approach 

Accessibility, convenience and speed are the three factors that determine whether your customer service operations are truly customer-focused. For example, nobody likes being left on hold —your customers are no exception. That’s why making the IVR journey as interactive as possible is essential, gathering key context before routing them to a live agent. 

Now, imagine this: A customer prefers live chat or social media, but when their query isn’t resolved, they’re routed to a call queue. After waiting longer than expected, they finally reach an agent — only to have to repeat their issue all over again. Frustrating, right? This not only frustrates customers but also undercuts your customer-first approach. 

The solution? Making customers feel valued from the moment they reach out and ensuring their service experience is as seamless as possible.  

💡 Good to know  
 
A modern unified agent desktop brings multiple customer service channels together on one screen, giving agents a bird's-eye view of customers' cases while enabling them to have concurrent conversations across channels seamlessly.   

Also, upon escalation, customers won't have to repeat themselves across different channels as your agents will have all the context they need — from the customer's last purchase to previous interactions — right on the unified screen. This can reduce average handling time by up to 30%, making both customers and agents happier.  

Reduce Agent Workload by Over 50% with Unified Agent Desktop  

See in Action

2. Deliver personalized support 

Personalized support, whether on-call or live chat, makes customers feel valued by addressing their unique needs and preferences. This approach proactively addresses issues, builds trust, ensures a smooth customer experience and drives repeat business.   

3. Empower staff with the right tools 

It is important to provide your staff with tools to automate information retrieval and speed up issue resolution. For instance, integrating CRM with your customer service system ensures agents have the necessary information readily available during live calls or chats.  

Similarly, chatbots can handle frequently asked service questions and maintaining a comprehensive knowledge base can be beneficial as it allows customers to self-serve. These solutions can reduce the workload on agents, minimize repetitive queries and ultimately help prevent agent burnout and frustration

How Sprinklr helps 

Sprinklr's AI-powered agent assist software takes this a step further. With Sprinklr AI, agents are automatically provided with similar resolved cases, relevant knowledge base articles and guided workflows based on the conversation's context. This enables real-time nudges, helping agents make better decisions, reduce average handling time, boost upsell opportunities and ensure SLA compliance. 

BOOK DEMO OF SPRINKLR AGENT ASSIST

4. Enable automation with a human touch 

Automation with a human touch balances efficiency and personal connections. For example, after an automated order confirmation, a personalized follow-up from your customer service agent can make your customer feel valued. This fosters genuine customer connections, helping enhance the overall customer service experience.   

5. Seek customer feedback 

Gathering and acting on customer feedback boosts morale, enhances service and drives continuous improvement. This can be achieved through regular customer surveys and feedback forms. These tools not only help you learn more about your customers but also provide valuable insights for product development, revealing areas for improvement and helping to raise your CSAT scores. 

Say bye to survey fatigue 👋 

Believe it or not, survey fatigue is real and it can lead to lower response rates. However, you can combat this by turning your feedback collection process simple and conversational.  

Sprinklr’s advanced feedback management survey software transforms traditional surveys into interactive conversational surveys, driving higher completion rates. Sprinklr AI dynamically tailors questions based on previous answers and probes to uncover deeper insights. The best part is that you can run these conversational surveys with a visually appealing design on social and digital channels.   

Streamline customer surveys with AI-powered workflows 

See How It Works

Role of AI tools in customer service experience  

AI-powered tools can dramatically enhance the customer service experience by streamlining interactions and boosting efficiency. Here are four ways to leverage AI in your operations. 

AI-powered smart responses for faster resolution 

As agents engage with customers via live calls or chats, AI can dynamically generate reply suggestions, providing quick contextual responses that help resolve issues faster. These tools also optimize agent replies for tone, relevance and accuracy, ensuring faster responses and greater customer satisfaction. 

Live CSAT trend monitoring and sentiment predictions 

AI can monitor conversations in real-time for critical signals — like changes in customer sentiment, CSAT, tone, intensity and intent — allowing you to predict potential escalations. This helps you auto-alert supervisors before issues spiral out of control. 

AI-powered scoring to ensure call quality 

As call volumes grow, manually reviewing each conversation for quality and compliance becomes nearly impossible. AI scores conversations based on over 30 quality and compliance-related factors, such as active listening, empathy, and the introduction/closing of calls. With detailed reasoning behind each score, you can quickly review agent performance, spot areas for improvement, and take action before it’s too late.

Did you know 

With Sprinklr AI, you can transcribe voice calls in real-time, significantly reducing evaluation time through accurate transcription and call analysis in 20+ languages. It also offers AI-powered indicators that detect issues like clamor or high-pitched tones in both customer and agent dialogues. This allows supervisors to be notified in real time and have the option to whisper to the agent or barge into the conversation if needed.  

Proactive engagement 

AI tools can analyze data from multiple sources to predict customer needs and deliver personalized recommendations before a customer even asks. AI uncovers valuable insights by capturing queries and keyword variations from unstructured conversations. This proactive approach allows you to anticipate customer preferences and trends, ensuring a more personalized and seamless customer service experience. 

Create delightful customer service experiences with Sprinklr 

As challenging as it may seem, today's customers expect quick, personalized, seamless service at every touchpoint. That's the reality. But without the right tools, even the most well-intentioned customer service teams can fall short — leading to longer response times, frustrated agents, and, worst of all, unhappy customers.   

Imagine the missed opportunities when customers abandon interactions because they're stuck repeating their issues across channels or left waiting on hold for far too long. Every second counts and failing to meet these expectations can damage your brand's reputation and erode customer loyalty.    

Sprinklr Service is built to tackle these challenges head-on. With its AI-powered, unified customer service platform, your team can respond faster, gain deeper insights and deliver seamless service across every channel — whether through voice, live chat, social media or messaging apps.

Schedule a demo of Sprinklr Service today and see how it can transform every interaction into an opportunity to strengthen relationships and boost customer satisfaction.