Virtually all CEOs of the fastest-growing U.S. companies (87%) single out quality of customer service as being very important to the growth of their business over the next 12 months. And, according to the latest PricewaterhouseCoopers Trendsetter Barometer survey*, 31% expect quality service will produce the single most profitable return for each dollar invested.
“These fast growth businesses owe much of their success to being market driven,” said G. Steve Hamm, managing partner of PwC middle market advisory services. “They understand the rewards and benefits of serving their customers well.”
“It should be noted that considerably more non-tech than high tech businesses – 91%, versus 83% – cited quality of service. Non-tech businesses often must struggle for competitive differentiation, and consequently may have a somewhat greater focus on the service aspects of their operations.”
Half or more of the CEOs surveyed also cited four additional sources of growth. These included: product improvements or extensions (62%), information technology (59%), advertising and sales promotion (58%), and development of entirely new product lines (49%).
“While none of these came close to customer service in the rankings, it should be mentioned that information technology came in third, and this growth source underlies or enables many customer service improvements,” added Hamm.
Leaders of technology companies placed greater emphasis on certain growth sources compared to their non-tech peers. Considerably more cited product improvements or extensions, 68%, 10 points more; information technology, 63%, seven points more; and development of entirely new product lines, 55%, 13 points more.
“These differences are a reflection of the comparatively short product life cycles and driving emphasis on innovation in technology businesses,” noted Hamm.
Nearly one-third (31%) of CEOs also cited quality of customer service as producing the single most profitable return for each dollar invested – again, far more than any other source studied. Next in importance were development of entirely new product lines (16%), product improvements or extensions (11%), advertising and sales promotion (8%), and territorial expansion within the U.S. (8%).
“It has long been said that quality customer service is the seed of a repeat purchase, and now here’s proof that it is also the most cost-effective growth source,” said Hamm. “For cost-effectiveness, nothing else comes close.”
* PricewaterhouseCoopers' Trendsetter Barometer is developed and compiled with assistance from the opinion and economic research firm of BSI Global Research, Inc.