Customer Service and Customer Relationship Management
Service quality
The exam tests service quality, complaint handling and CRM as a business process, not just software. Common service-quality dimensions are reliability, responsiveness, assurance, empathy and tangibles. Reliability matters most in retail: the customer wants the promised product, price and time. A service gap occurs when the promise and the delivery differ.
CRM basics
- Collect: capture contact details, purchase history and preferences with consent.
- Segment: group customers by value, frequency, basket or loyalty stage.
- Retain: use relevant offers, follow-up and recognition; retention is usually cheaper than acquisition.
- Measure: repeat rate, customer lifetime value, complaint resolution time and satisfaction score.
Complaint handling
Listen without interrupting, acknowledge the issue, clarify facts, propose a solution within policy, act quickly, record the case and follow up. Service recovery can strengthen loyalty if it is fast and fair, but it cannot replace reliability.
Worked example
A customer’s online order of a ₹1,200 school bag arrives with a broken zip. The store offers an immediate replacement and ₹100 store credit. The direct cost is ₹100 plus handling. If the customer’s average annual margin is ₹1,500 and she would otherwise leave, retaining her is worth more than the credit. The reasoning: compare recovery cost with expected future margin, not with the value of the single complaint.
Traps
CRM is not merely buying software; it needs clean data, consent and use. Do not overpromise delivery dates to close a sale. Do not offer a discount before diagnosing the complaint. Under India’s data-protection expectations, do not share a customer’s phone number or purchase history without a lawful basis.