Hospitality Industry
2 min read

What are the benefits of implementing Service Recovery?

EHL Insights
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While some errors may be inevitable in the service sector, dissatisfied customers are not. This is why some service providers opt to take action in response to service failure by exercising patience, asking the right questions, taking the time to understand their customers’ issues while ensuring a rapid response to restore harmony. In short, going above and beyond to right wrongs and restore customer satisfaction.

It is said to cost five times more to replace a customer than it does to retain one, with the expense of marketing weighed up against predicted future spending among existing customers. Surely this is reason enough to ensure everyone in your organization has the skills, motivation and authority to pursue Service Recovery whenever the need arises? Implementing Service Recovery presents your company with many potential benefits.

Benefits of service recovery:

· Increase customer satisfaction

Thanks to the Service Recovery Paradox (SRP), customers may think more highly of your company once you have successfully corrected a service failure, compared to how they would regard it if non-faulty service had been provided.

· Generate a loyal customer base

Thoughtful Service Recovery measures have the power to emphasize your company’s commitment to Service Excellence. Letting your customers know that their satisfaction is your top priority may well keep them coming back time and again, enabling you to reap the rewards of a higher total customer lifetime value.

· Create brand ambassadors

Service Recovery is yet another opportunity for your company to showcase its values and present your brand in its best light. If you succeed in surpassing your customers’ expectations in this regard, they may feel compelled to spread the word, polishing your reputation.

· Avoid losing potential customers

In the absence of appropriate Service Recovery, disgruntled customers often share their experiences with their nearest and dearest, posting negative comments on social media or leaving bad reviews on ratings sites. With 94% of ReviewTrackers survey respondents reported to have been convinced to avoid a business by bad online reviews, curbing these is crucial.

· Side-step profit losses

The profits lost when a customer is left unhappy are often underestimated and therefore under managed. A solid, company-wide Service Recovery strategy can help circumvent this source of profit losses.

· Trouble-shoot service failures

Service Recovery efforts may highlight recurring customer service process issues. Tracking problems may reveal hotspots for service failure, granting you the opportunity to remedy any process friction. Complex processes with many moving parts and interdependent timelines are particularly prone to service failure, as is the timeframe allocated to the introduction of new services or products.

   From service design to service recovery, here is your guide to achieving  service excellence.  Learn more

Service Recovery is an integral part of service excellence

A systematic approach is likely to prove fruitful in implementing Service Recovery, especially with regard to corporate cohesion and brand identity. Should you like a helping hand getting started, take a look at Freshdesk’s 3 steps to prepare for Service Recovery implementation, consult Hospitality Insights’ 5-step Service Recovery solution or read The Thriving Small Business’ 5 tips for successful Service Recovery. For a more comprehensive overview from Service Design to Service Recovery, see EHL Advisory Services’ Service Excellence guide.

As you train your employees and empower the front line, be sure to prioritize your efforts according to leverage potential and distinguish between small-scale issues your front of house can deal with and large-scale problems requiring top-management attention. Recognize that, despite your best efforts, some customers may be difficult to please, while others may outright abuse your kind Service Recovery offerings.

All caveats and challenges aside, the benefits of implementing Service Recovery speak for themselves. If you consider customer satisfaction to be a primary business goal, note that Service Recovery – fundamental to Service Excellence – should form an integral part of any company’s service strategy.

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