Do you need to offer Customer Service - or is it cheaper not to?

Many of you (thankfully) may not have heard of the 'wannabe' home of low-cost flights called Jet2 and if you haven't as yet had the opportunity to sample the 'delights' of their offering, my personal opinion would be simply this - don't. I've travelled with them twice (both times experiencing some of the worst travel stories of my life!) so i know my experience is not a one-off...and therefore cannot be forgiven as such.

We all understand that low-cost means just that, and yes we understand that we wont perhaps get all the frills (if you can call a free sandwich and a drink such a thing) but there are some basics that should happen and must never be cut - these are basics of customer service, respect and availability of personnel willing to deal with valid customer complaints. On a recent journey with Jet2, these basics were not only overlooked but indeed seemed to have been accepted as "not included!" Even their tag line is a joke - "friendly low fares" - could someone please explain to their marketing guys and girls that it's not the price that needs to be friendly - its the staff and the ethos of the business. Having a low fare is just a price thing, not a service thing....but perhaps this is the point?!

In this recession-strapped world, where companies seek to reduce costs, customer service can seem like one thing that you don't need to worry too much about....WRONG, WRONG and once more WRONG!

The list is endless with companies who seems to have done the maths that says it costs £x to have a fully trained (and accessible) customer service team and if you (foolishly) assume that most of the people who are not happy wont come back anyway, it's cheaper not to deal with the problem, rather than train staff to do so....sounds back to front...but think about it? If your business is "high-churn" (the term these types of companies use for meaning people leave us all the time), then losing a few percentage points more doesn't really make any difference - if you're cheap enough some other (sucker) will fill their space.

Such a policy (written or otherwise) seems to be most common in markets where it is harder to switch (think broadband providers for example) and so the calculation for customer service has become much like the bean-counters of old at the car manufacturers who worked out it was cheaper to send out a car even if it had a dangerous fault and pay for the people who got hurt (rather than fix the fault which would have cost more!)

But I would suggest in these cash-strapped days where the customer is not just king, but banker too, looking after the ones you have, resolving accurately and promptly issues when mistakes occur and going out and winning new ones it all important. Research shows that a client that has a problem with service and has their problem promptly and professionally resolved will often become not just a repeat user, but regularly an evangelist of the product, brand or service! But try getting a bean-counter to build that into a spreadsheet - as any accountant will tell you - it is very hard to value goodwill - but in this market it can be the difference between success and failure - if you can't rely on your existing clients to keep shopping - what hope do you have?

For me, my Jet2 experience means - firstly i will never fly with them again, secondly i am taking every possible opportunity to share with as many people as i can my feelings about them, thirdly, I would have happily paid a few pennies more to ensure a better level of service (because the stress and time delay meant more to me than the pennies!)...so there you go Jet2 - you lost a customer, he's become an evangelist for all things NOT Jet2 and would have paid extra to be happy to boot - still think your customer service calculation adds up?

Best Price or Best VALUE?

The debate of best value is by no means unique to the office supplies industry...take airlines for example.

RyanAir has built a business on the basis of "low fares" not best value or customer service. But often its sometimes extreme focus on "discretionary revenue" has come back to bite. Recently the undiplomatic Michael O'Leary declared on BBC TV that the airline was considering charging £1 to use the on-board toilet. This sparked headlines and got RyanAir more free press than anything that the concept of having no check-in desks would have got (which was the reason he was actually being interviewed!)

People who fly RyanAir often plan and bring their own food, drinks etc on-board...bringing your own toilet might be a little too much....but you have to give it to them for spinning a rather dull story into something of note.

But the whole concept comes back to value and the client's perception of it. For some, it is all about the price of the ticket - hence the fact that RyanAir flies 729 routes with 181 aircraft - but for others Leary's manner, Ryan Air's corporate attitude and contempt with which he seems to view the flying public may be more than they can bear and so other, added-value airlines win through. The interesting question is at what point do the price proposition get found out and buyers begin to tot up the incidental costs of paying to put a bag in the hold, paying by debit card, paying for food paying for the toilet....what will be next - perhaps the spoof safety card above suggests some ideas!?

But seriously take this real-world example:

Stanstead to Barcelona with 1 bag in the hold, priority boarding, meal on-board, paying by debit card travelling out 18th March 2009/return 21st March 2009 - total cost?

RyanAir- £87.68 - (RyanAir advertises ticket at £0.01 and £0.00 before taxes!)

British Airways - £91.00

Additionally, the BA flights arrives at Barcelona's main airport - much closer to Barcelona than the RyanAir flight (which would no doubt save you the £3.32 in travel cost!)

So who is cheap and who is not? OK I know you can deselect the priority boarding and bring your own food - but in a like-for-like experience (or as close as you can) BA would seem the better deal overall....did you expect that?

Stationery presents much the same challenges as that of the airline industry....some clients are all about the price of the paperclip, paper, toner etc....for others the ability to speak to a knowledgeable member of our team, know that we are environmentally focused, flexible billing, have a late cut off of 18:00hrs for next day, have a great price on everything they buy not just the "loss leaders" promoted by the supplier and not be tricked by hidden charges (like "protection plus" - Viking Direct's equivalent of the debit card charge from RyanAir) have a value.

But some poor souls will always be seduced by the perceived low price with which such companies play their game. We believe in transparency, openness and no hidden tricks - and in turn we believe that when you really play on a level playing field that much like BA, UOE offers its clients BEST VALUE overall.