Customer service and customer service training are vital for any business.

But, is your business a leaky bucket?

This is a question I always ask small business owners who attend my marketing seminars.

The reason I ask is because many businesses are so focused on attracting new customers they forget about retaining and providing good customer service to their existing clients.

Many are also unable to quickly identify who their most profitable customers are.

In the leaky bucket example we have two businesses in the same industry. Both businesses attract 10 per cent new customers each year. Not a bad effort considering the increasingly crowded and competitive industry they operate in.

Business number one has a 95 per cent retention rate and 5 per cent slippage, while business number two has a 90 per cent retention rate and 10 per cent loss of customers.

Not bad figures to have, but after 14 years business number one has doubled in size and business number two has stayed the same size.

This business is just treading water because it suffers from a leaky bucket' with too many customers slipping through the holes in the bottom of the bucket.

Much of this is due to poor customer service. And they don't even know it!

For example, the research shows a typical business does not hear from 96 per cent of unhappy customers.

For every complaint there are 26 others with the same problem and the average person with a problem tells 9 or 10 others. Thirteen per cent will tell more than 20 people.

So that is the cold hard reality of poor customer service.

But it is not all bad. If complaints are resolved those people tell 5 people and it is usually a positive message.

For example, complainers are more likely to do business with that company again compared to non-complainers, and this rate goes to 95 per cent customer retention if the complaint is dealt with quickly.

Everyone makes mistakes, the key is to learn from those mistakes and act on them quickly and you will have even more loyal customers.

Keeping your customers happy will help fill the holes in your leaky bucket and lead to a more profitable and successful business.

Thomas Murrell

Thomas Murrell is an International Business Speaker and Managing Director of 8M Media and Communications, an integrated media, marketing and management consulting company.

Described by BRW Magazine as "committed to using creativity as a competitive edge", he is recognised as an expert on how to be media and marketing savvy.

His Integrity Marketing, Brand Building and Winning the Media Game topics are full of real life experiences and practical advice.

In a former life he was a TV and radio personality, executive producer and senior media executive ? describing his 12 years at the Australian Broadcasting Corporation as an "apprenticeship".

The author of Media Fundamentals, How to Turn Your Big Marketing Idea into a Competitive Advantage and Web Marketing Essentials, he has just released his signature Media & Marketing Masterclass? series on six interactive CD-ROMs.

He uses metaphors from his experience as a National Junior Hammer Throw Champion to demonstrate the ?power of positive spin? and a Vincent Fairfax Fellowship helps put this within the context of ethical leadership.

Media Motivators is his regular electronic magazine read by 7,000 marketing and PR professionals in 15 different countries. You can subscribe by visiting http://www.8mmedia.com/

Write to Thomas Murrell at tom@8mmedia.com/.