The recession is no excuse for cutting back on customer service, says Tim Ogle. After all, a smile costs nothing

Maintaining good customer service is vital in the recession.

Although there are tentative signs of a recovery, the recession still looms large over every UK business, and as every day passes the prospect of falling sales and fragile profits increases the temptation to cut costs. As a result, retailers are in danger of viewing good customer service as a boom-time luxury, an ideal that is perfect when profits are riding high, but first to be pushed aside in a downturn.

However, as shop staff are the first point of contact with the customer, is your cost-cutting campaign also cutting back customers' spend?

In the storm of recession, sometimes it helps to be reminded of the basics: the better your customer service, the more customers will return to your store. Special offers and cut-price deals may entice the customer into your stores, but good customer service will keep them coming back, both in the short and long-term. Not only will customer advocacy increase, so will the amount each customer spends.

A survey of 3,545 UK consumers revealed that three quarters would pay more for a product if they received better service. Further still, surveys show the majority of consumers (60% in a recent poll of 9,000) base their shopping decisions on reputation rather than price .

It's not just about statistics, it's also about customer experience. If shop staff are friendly, helpful and polite, then not only do you have a happy customer and potentially a product sold, you have significantly increased the likelihood of that customer returning to your store and recommending you to their friends. These interactions are free; there are no overheads on a friendly smile.

Knowing what customers think of your offer, hearing their insight into the quality of customer service and exactly where and how improvements could be made, is invaluable. Whether you go for simple feedback forms or a fully fledged mystery shopping campaign, it is vital to both your reputation and your bottom line that you listen and learn from the customer. It's insight and intelligence that the grocery industry can't afford to do without.

Tim Ogle is CEO and co-founder of retail and development agency Retail Eyes.