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How Customer Service Impacts Your Loyalty Program

The relationship between customer service and customer loyalty directly impacts a business’s success. Customer service can either make or break a business depending on whether customers are satisfied or not.

When a customer has a positive experience with customer service and their issue is resolved, the relationship between the business and the customer is strengthened. The customer will view the business’s brand in a favorable light, and they may even tell their friends and family about their experience on business review sites like Yelp and social media platforms. If a customer is dissatisfied with the quality of the customer service they received, having been treated badly or as if their issue didn’t matter, then they could decide to never shop there again, and the business will have lost a customer for life.

The quality of the customer service that you offer at your business has the power to influence customer loyalty. Nothing benefits your business more than having loyal customers who routinely choose your store instead of patronizing the competition. If you’ve been highly focused on providing the best products for the best prices, this article will equip you with the best practices for improving the customer service experience at your business. Afterall, great products aren’t worth much if you don’t have loyal customers committed to buying them.

Solve Customer’ Problems

Solving customer issues, problems, and complaints is at the heart of any customer service department. If customer complaints weren’t a natural part of running any business, you might have very little need for customer service personnel. While dealing with customer complaints and problems isn’t the only reason to implement excellent customer service at your business, it is possibly the biggest one. And quickly rectifying the issues that your customers bring to your attention should be considered paramount.

Quickly and painlessly would be the best way of putting it. This doesn’t go without saying. Lax customer service and a laissez-faire attitude towards customer complaints will only result in disgruntled customers who don’t make the mistake of shopping at your store twice. Is the customer always right? Maybe not in every instance. However, in every instance your customer service personnel should respect the customer’s complaint as important, valid, and worthy of at least some degree of correction or compromise.

Effectively solving customer problems in a timely fashion is one of the best strategies to retain customers and influence their loyalty. Make sure that the technology you have implemented at your business helps rather than hurts this goal. If you implemented a touch-tone automated phone system to free up your in-store personnel from having to field phone calls while they tend to in-person customers, make sure that the customers calling aren’t going to be frustrated with endless options, robotic instructions, or worse, a never-ending ring tone when they push the option to speak to a real human being. The same rule applies to your website’s contact-us system. When customers send an email or interact with live-chat–a pop-up-assistant message box–to no avail, you will have frustrated them straight into the arms of your competitors. No one likes feeling like a voice in the wilderness, especially when they need help, so be certain that the lines of communication are open along every avenue you’ve provided your customers.

Remember: the lifetime value of a single customer will always be worth more than the dollars-and-cents “cost” of reconciling their complaint.

Keep Your Employees Encouraged

In large part, your customer service staff is your first line of defense against losing customers that are currently dissatisfied with some aspect of your business, whether a faulty product or sub-par service is at the heart of their complaint. As a business owner, you have a vested interest in providing unhappy customers with a resolution that will please them, because this will reinforce how accommodating and personalized your brand is. But you also have a vested interest in keeping your employees happy. In other words, you definitely don’t want to make your customer service personnel feel like they have to be the “bad guy” in the eyes of customers just because an aspect of their duties is to protect the company.

Though it might not happen often, the following scenario does occur, at least on occasion. A customer comes to customer service with a complaint and the customer already has in mind the resolution they want. But the proposed resolution is against company policy, which your customer service representative has been entrusted to uphold. Tensions rise when your personnel explains to the customer that the resolution they want will not be possible. Then the customer insists on speaking with a supervisor, manager, or the owner. If that supervisor, manager, or owner swoops in and then accommodates the customer’s original request, the customer service representative will feel undermined. They will feel like the “bad guy”, and the morale of your first line of defense will plummet.

How can you mitigate, or altogether avoid, this negative dynamic between customers, your customer service department, and your managers? Setting strong customer service standards can help. Likewise, putting the right staff and processes in place at your company, and being sure to thoroughly train your staff–all levels of management within that department–with real-world scenarios, which we will cover in the next sections of this article.

The fact of the matter is that not every customer complaint will be resolved in such a way that leaves all parties perfectly satisfied. It would be unrealistic to assume there won’t be a few bumps in the road. But despite the bumps, there are ways to support your customer service personnel so that they stay positive and encouraged, and feel appreciated.

Remember: you cannot have a profitable business with low-morale employees whose bad attitude chases customers away.

Strong Customer Service Standards

Every organization should have a basic expectation for employees to provide good customer service. But you can’t expect your employees to uphold standards that they are either unaware of or not entirely clear on. In order to solidify strong customer service standards at your company, you must first understand the two different kinds of customers that are associated with your business. Namely, these are external customers and internal customers. Both of these different customer groups must receive satisfactory customer service to ensure the success of your business.

The external customer group refers to those customers who are outside of your company and who buy your products and services. For instance, if you own a pet supply store, your external customers are those who enter the store to purchase dog food, or order from your company online. The internal customer group, by contrast, refers to anyone within your organization who depends on the services of another person within your organization. An example of this relationship would be your in-store personnel’s dependence on a properly functioning POS device. In the event that the point-of-sale screen goes black due to technical difficulties, the IT personnel responsible for fixing the issue represent another arena of customer service at your company. If the IT department is slow to get the POS back online and your in-store sales personnel are held up because of it, then tensions will rise between departments.

For each of these customer groups–both internal and external–there are customer service standards to implement that can lead to an overall great customer service experience. Once you are clear on the standards and make them known to your staff, your staff will be equipped to uphold them, and you will increase your customer retention rate both inside and outside of your company.

o supply you with a solid foundation upon which to build your own business’s unique customer service standards, the following are some points to get you started. Please note that all of the first list regarding serving external customers should also be applied to serving internal customers. For the sake of brevity, we’ve chosen not to repeat that list below.

When Serving External Customers

  • Greet customers in a courteous and professional manner
  • Listen fully to customer complaints, do not interrupt, and take prompt, necessary actions to assist them
  • Upon complaint, inform customers of typical resolution timelines and when they can expect resolution fulfillment
  • Keep customers informed of unexpected delays in service
  • Set and uphold reasonable response times for all website and web-based complaints, and aim to keep responses within 24 hours
  • Finish customer service interactions in a courteous and professional manner

When Serving Internal Customers

  • Regularly touch base with your internal customers to update them on the progress of reconciling their complaint, issue, or problem, and keep updates as close to an hourly basis as possible when issues are urgent and directly affect business operations
  • Work interdepartmentally–and also work intra-departmentally–to resolve issues, discuss problems immediately and directly, and devise and implement an agreed-upon solution until that solution has been achieved
  • Pledge to be considerate, cooperative, helpful, and most importantly available to other members of the staff until the issue is resolved to assure quality services
  • Hold yourselves and each other accountable if and when inappropriate comments or behavior occur

General Customer Service Standards to Uphold

  • Aim to exceed the expectations of all of your customer groups
  • Proactively work to meet your customers’ needs in order to preemptively reduce the risk of complaints
  • Hold yourselves and each other accountable for fulfilling the company’s customer service standards in a courteous and professional manner, i.e. professionalism in attitude, tone of voice, tone of email, and word choices when communicating
  • Compliment and reward staff with positive acknowledgement when they live up to the company’s customer service standards

Once you have devised the customer service standards for your company, you’ll need to make sure your staff understands the actions and etiquette you expect from them, as the next sections will touch upon.

Remember: scheduling weekly or monthly staff meetings to discuss the real-life successes or failures of your company’s standards will ensure an opportunity for growth and secure a higher retention rate of customers.


The flip side of handling dissatisfied customers who have problems, issues, and complaints is keeping customers happy across the board with perpetual rewards for patronizing your business. Deploying a customer loyalty rewards program at your business can greatly enhance the customer service experience of your customers.

At the beginning of this article, we mentioned that dealing with customer complaints is at the heart of any company’s customer service department. But customer complaints aren’t the only aspect of customer service that you can provide. Receiving deals, discounts, sales offers, and sales incentives make up a substantial portion of having a positive customer service experience.

With today’s technology–and by implementing the right loyalty rewards program–you can offer your customers far more than deals and discounts, and your rewards program can also supply a wealth of valuable information about your customers to your customer service personnel. Additionally, when loyalty members can use the rewards program to communicate with customer service, it opens up even more convenient lines of communication. A customer’s purchase history is documented within their loyalty account, which your personnel can reference to better accommodate their needs, should an issue arise. All told, the best way to launch a strong, positive charge towards establishing excellent customer service at your business is by utilizing your customer loyalty rewards program to its fullest potential.

When you leverage valuable customer data and personalize the rewards incentives offered to your customers, you help to make your loyalty members feel appreciated. These kinds of personalized touches also help your members feel as though you know them and as though you are happy to accommodate them, which ultimately results in them viewing your brand in the right, positive light. Even if a problem, issue, or complaint does arise in the future, their attitude towards your brand will be one of trust, assurance, and respect.

Remember: customer appreciation is reciprocal and when you show your customers that you appreciate their business, they will show you that they trust you to handle their issues, should any arise.

Loyal~n~Save is committed to helping business owners achieve excellent customer service standards with the help of our customer loyalty rewards program. If you would like to learn more about what our technology can do for your company, then find your industry on our Industries Page or Contact Us today.


  • customer loyalty program
  • Customer Service

Posted on Mar 11, 2020


Danielle Dixon

Danielle is a content writer at Loyal-n-Save. She specializes in writing about implementing loyalty solutions proven to help a company grow.

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