Customer service is not cost of sales

I think the primary reason for endemic poor customer service is because management typically includes it under the cost of sales head. Unfortunately, cost of sales is something organizations see as an unwelcome item on their balance sheet. They want to reduce it or better still eliminate it completely. Having more staff in customer service centers means more cost, so they come up with (unintelligent and ultimately frustrating) ways to automate the customer service. They fail at this automation miserably and end up annoying the customers. All this is because customer service is seen as cost of sales, which is wrong


Customer service is marketing expense
Ironically, just because poor customer service is endemic, a company can get huge competitive advantage just by having a good customer service. Each customer service interaction leads to either a happy-and-satisfied customer or a frustrated-and-angry customer. Research shows that buying decisions are heavily influenced by peers, friends and family. Advertisements and marketing just creates awareness. It’s ultimately the recommendations that cause people to purchase stuff. And guess what drives recommendations? Product quality and features is one part. The other big part is customer service. No frustrated customer will EVER recommend a service, no matter how many features you cram into it or no matter if you run never ending national TV advertisements.
The right way to look at customer service is to see it as a form of marketing expense. If every customer service interaction creates a happy customer, it should be seen as an alternative to advertising or marketing. In fact, even if most organizations spend even 10% of their billions of dollars of advertisement budget on customer service, world will be a much better place