Wednesday, July 8, 2009

The Service Guarantee

When pitching new business, consider a service guarantee. By this I mean an unconditional money back guarantee. The guarantee should be “If for any reason you are not satisfied with our services, you will receive a 100% refund of the price.” Why do this? There are several advantages: (1) It gives the client/customer an incentive to complain, since 96% of customers will not share their gripes-they will simply switch firms. You should encourage complaints in order to improve your service delivery. (2) This will commit your entire firm to delivering “Total Quality Service” because your money is on the line. And (3) it informs your customer how much better you are then the competition because you are willing to back your promises. Why should the customer bet on you if you won’t?

All things being equal, services with a 100% guarantee will command a higher price than those without. Whether you realize it or not, you are probably doing this already! If one of your customers complained loudly enough, you would most likely refund or not collect the fee. Why not take this covert policy and put it into your agreement so the customer can perceive a higher value in dealing with your firm.

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