How Customer Service Impacts Prospecting and Customer Acquisition

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It’s no secret that providing excellent customer service to all customers will help your business grow. Not only will it help your business, but it will also increase your bottom line by achieving repeat business from your customer base and creating brand advocates.

In this article, we will dive deeper into how customer service affects your opportunity for prospecting by boosting word-of-mouth and a strong reputation.

As business owners, we all compete for every customer amongst our competitors. When you’re a smaller business the cost of customer acquisition can be challenging.  As you know, the cost to acquire new customers is much greater than gaining a repeat purchase from a customer who knows your brand.  After gaining the attention of a prospective customer, it can be even more difficult to get them to trust you if they are finding negative comments about your brand online.  

This is why customer service plays such an important role in customer acquisition and prospecting. Let’s go over a few statistics on how customer service can affect you according to a study by

  • 81% of people are most likely to work with the business again after good service
  • The effects of good service increase your customer retention by 5%
  • High-level customer service can increase your profits up to 125%
  • Companies that make customer service a priority make 60% higher profits than rivals
  • Loyal customers are worth 10 times as much as the first purchase on average

How customer support affects prospecting and customer acquisition 

A good reputation upheld through excellent customer service can lead you to a lot of customers and vice versa if your reputation is tarnished through negative experiences. The more you work on incorporating high-level customer service tactics,  the more you can rely on new customers coming in through word-of-mouth and reputation.

Make note that the cost of acquiring a new customer can cost five times more than retaining an existing customer. Increasing customer retention by 5% can increase profits from 25 to 95%.  The success rate of selling to a customer you already have is 60 to 70% while the success rate of selling to new customers is 5 to 20%.  

This data shows the importance of customer service and the impact it can have on prospecting and acquiring new customers. The more your business focuses on quality customer service, the more funds are available to spend and invest in prospecting and acquiring new customers.  The retention rate of current customers increases, conversion of prospects will increase – driving more profits to grow your business. The customers will come flooding through your door thanks to your loyal customers and stellar reputation.

Happy customers spend more money 

To have a thriving business not only do you have to take care of the customers who you already have, but you also need a budget set aside to search for new customers as well.  A great way to ensure you have enough budget in place to prospect for more customers is to make your current customers happy enough to the point where they will spend more with your business. Each interaction your customer has with your business directly impacts how much money they will be willing to spend.

Approximately 70% of buying experiences are based on how the customers feel they have been treated.  By engaging in high-level customer service tactics you make the customers feel validated and happy which will directly impact your sales in giving you enough revenue to acquire more customers.

Avoid negative experiences to increase customer acquisition

Behind every thriving business is the support of a stellar customer service initiative. With this in mind, it’s important to understand that it can be really tough to make up for any customer experiences that are bad. Although all companies make mistakes, it is important to understand what caused the error and how can such errors be avoided in the future.  You can imagine a prospective customer checking reviews for a brand and seeing similar negative reviews for the same issue.  This sets concern in the consumer’s mind about how their order will be handled.  This is why it is important as a business owner to read customer feedback, talk to the team to understand what happened, and put in place procedures to eliminate future errors.  Additionally, training your team on how to manage your customers and how to make them feel valued is so important. 

With each bad experience, there is the ability to drive customers away and cost your business potential revenue. Have you ever heard the saying “ bad news travels fast?” Bad news actually travels twice as fast as good news. This means that no matter how small the trouble it’s important to address any issues that your customers may have and to have a system in place to remedy each situation. This will enhance your company‘s reputation and can lead to new customers through word-of-mouth in the future. 

How excellent customer service track records can improve your prospecting experience

When searching for new customers you will always get a few who are hesitant and not ready to buy right away. They might need a little more information and assurance that you are the right fit for them.

They will most likely turn to your online reviews to take a look at what other people have to say. If your business does a great job of providing customer service, there will be enough social proof to help them feel assured and to make the purchase or to take the next step with your business. 

Let’s say they do a quick online search and they see that you have more negative reviews on customer service than positive reviews. They are most likely going to say no and turn to your competitor. Now you see the importance of having an excellent customer service reputation when prospecting with a potential customer.

According to here are a few statistics to further explain how positive customer service reviews can affect your prospecting experience.

  • 91% of 18 to 34-year-olds trust online reviews as much as personal recommendations
  • 93% of consumers say that online reviews influenced their purchase decisions
  • 92% of B2B buyers are more likely to purchase after reading a trusted review
  • Negative sentiment in Google reviews is a negative ranking factor
  • 3.3 is the minimum star rating the majority of business consumers would engage with a business
  • Only 13% of consumers will consider using a business that has a one or two-star rating
  • 94% saying online review has convinced them to avoid a business altogether
  • Four out of five consumers have changed their minds about a recommended purchase after reading negative online reviews


These staggering statistics prove to us the importance of how a good customer experience can affect the prospecting and customer acquisition process. After reading this blog post, what steps are you going to take to ensure you set your business up for customer acquisition and prospecting success?