The Sad State of Customer Service

By Rosanne D’ausilio

The state of customer service today is not good, to put it mildly, whether it’s over the phone or on the Web using self-service options. Since 92 percent of people (according to a BenchmarkPortal call center study) feel their call experience is important in shaping their image of a company, it reinforces the significance of branding the image of your company.

A survey entitled “The Cost of Poor Customer Service: The Economic Impact of the Customer Experience and Engagement” – sponsored by Genesys Telecommunications Laboratories and Datamonitor/Ovum – looked at the cost of customer service in fifteen major industrialized economies. The results showed that customers who defect or abandon purchases cause businesses to lose a total of $338.5 billion dollars per year.

The 2012 American Express® Global Customer Service survey, conducted in the United States and ten other countries (Canada, Mexico, France, Germany, Italy, the United Kingdom, the Netherlands, Australia, Japan, and India), explored consumer attitudes and preferences toward customer service. This survey found that the most popular way consumers address service inquiries continues to be speaking to a live representative (either on the phone or face-to-face) and through a company’s website or email.

However, one in six consumers (17 percent) say they’ve used social media at least once in the last year to obtain a customer service response, and this relatively small group of consumers is extremely engaged and vocal. Consider that people who have used social media for customer service at least once in the last year are willing to spend substantially more – 21 percent more – with companies they believe provide great service. This is in contrast with the general population at only 13 percent more, with those who have not used social media for customer service at an even lower 11 percent more.

In addition, more than 80 percent of these consumers say they’ve bailed on a purchase because of a poor service experience, compared to 55 percent overall.

According to the American Express® Global Customer Service Barometer, the four biggest service gripes are:

1) Rudeness: An insensitive or unresponsive customer service representative, 33 percent

2) Passing the Buck: Being shuffled around with no resolution of the issue, 26 percent

3) The Waiting Game: Waiting too long to have an issue resolved, 10 percent

4) Being Boomeranged: Forced to continually follow up on an issue, 10 percent

However, despite the greater value consumers place on customer service, it’s reported that many centers don’t make the grade.

  • Six in ten people (60 percent) believe businesses haven’t increased their focus on providing good customer service. This is up from 55 percent in 2010.
  • Among this group, 26 percent think companies are actually paying less attention to service.
  • Consumers feel most centers fail to get the message that service matters. Nearly two-thirds of consumers feel companies aren’t paying enough attention to service.
  • Two in five (42 percent) said centers are helpful but don’t do anything extra to keep their business.
  • One in five (22 percent) think their business is taken for granted.

According to the Harris Interactive, Customer Experience Impact Report, 86 percent of consumers quit doing business with a company because of a bad customer experience – up from 59 percent just four years ago.

Customers are smarter than ever and looking for more value. More than just customer service, they want a great customer experience. If you can’t deliver, your customers are a click away from your competition.

The White House Office of Consumer Affairs, Washington, DC, says that 59 percent of customers will try a new brand or company for a better service experience. And it’s been noted in many articles that dissatisfied consumer will tell between nine and fifteen people about their experience. About 13 percent of dissatisfied customers tell more than twenty-four people, up 50 percent from 2011. On the other hand, however, happy customers who get their issue resolved only tell about four to six people about their experience. Ruby Newell-Legner, author of Understanding Customers, says it takes twelve positive service experiences to make up for one negative experience.

The bottom line is that customer service matters. And customers are willing to pay for it! Give your representatives the tools, techniques, customer service skills training, and support required to deliver excellent customer service.

Rosanne D’ausilio, PhD, is an industrial psychologist, consultant, trainer, best-selling author, executive coach, customer service expert, and president of Human Technologies Global, which specializes in human performance management and provides needs analyses, instructional design, and customized customer service skills trainings, as well as executive/leadership coaching.

[From Connection Magazine October 2012]

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