Attitudes Toward Customer Service
Service is the New Marketing
A survey was commissioned through leading market research company Ipsos-MORI during September 2012. The survey covered 7,000 consumers across six countries — UK, USA, France, Germany, Poland and Russia. Questions to the participants were focused around key service sectors: Finance (including banking, credit cards, insurance), Phone/TV/Broadband providers, Utilities (electricity, gas, water), Retail (online and in store) and Public Services (national and local tax, benefits, etc.). Where relevant, differences between service sectors and/ or countries have been highlighted.
Introduction
This report highlights the nature and attitudes of the modern consumer and identifies key facets of the customer experience. It analyses typical consumer responses to poor service and service failure, and explores the impact those responses can have on consumer loyalty and ultimately, brand value and profitability.
Based on the research findings, the report outlines some critical areas in which service providers should focus in order to help minimize a negative consumer response, and outlines the solutions available to help build customer delight and loyalty.
I. Executive Summary
Today’s consumers are often frustrated and angry. They’re tired of encountering overworked and understaffed customer service functions and falling victim to avoidable errors and delays. They’re unresponsive to traditional marketing messages and prioritise service above price, yet they feel short-changed because service is falling short. What’s more, whilst some are broadcasting their complaints far and wide over social media, a majority can’t be bothered to engage. This climate of customer apathy is the polar opposite of the marketing ‘holy grail’ — customer loyalty and advocacy.
When it comes to service, many suppliers are failing their customers. In doing so, they’re missing vital opportunities to generate loyalty and enhance their brand with a consistently exceptional customer experience.
Meet Your Customer
Several key themes emerged in our study findings, including:
Service Trumps Price — The majority of consumers value service above price. They’re unresponsive to discounting, and many don’t ever visit price comparison sites where these are available.
Angered by Delays and Errors — Many become angry over mistakes and delays. They don’t like being kept waiting, they don’t appreciate errors in their billings, accounts or orders — and they see too many of them.
Going Social — Consumers, particularly in the younger age groups, readily ‘go social’ with their experiences, both good and bad. For suppliers, this represents as much of an opportunity as a threat.
The Ambivalent Consumer — Many consumers are disengaged. They typically don’t complain, but likewise, they don’t change supplier at the first sign of a problem either. Their inertia might be seen as good news for the supplier, but the consumer’s ambivalence and lack of engagement can open the door to complacency.
Unresponsive to Traditional Marketing — Another sign of ambivalence perhaps? In many cases, the modern consumer has become immune to conventional marketing messages. Generally speaking, they rate good service over the price promotions and discounts that are featured in so many marketing campaigns.
Points of Failure
Suppliers often fail to understand their consumers’ priorities, and as a result, they’re focusing on the wrong things. Without insight and a true understanding of what customers are thinking — how they feel about the service they receive, where they see problems, and what they think of the marketing campaigns which target them — the supplier cannot be certain they’re directing their attentions toward the areas which make a positive impact on the customer.
Many delays and errors stem from broken processes and inappropriately resourced front- and back- office customer service functions. Workforce Optimisation technology, supported by the right business processes and best practices, can help reduce process errors and improve efficiency. Likewise, teams need to be resourced appropriately to meet fluctuating demand conditions.
Strategies to Build Customer Delight
Improve resource planning — Implement a Workforce Optimisation strategy that encompasses such technologies as quality monitoring, analytics, forecasting, staff scheduling and process optimisation to help eliminate bottlenecks and service failures in both the call centre and back office.
Listen to the Voice of the Customer — and act on it — Implement Voice of the Customer Analytics — including speech analytics, text analytics and enterprise feedback management — to help build an understanding of what matters to customers. Pay particular attention to social media and other sources of unstructured data, such as telephone conversations and chat sessions.
Make ‘Surprise and Delight’ service the rule, not the exception — Combine the deployment of Workforce Optimisation and Voice of the Customer Analytics with cultural change to develop an ethos of ‘Surprise and Delight’. Examine current practices and make changes where necessary to enable customer service staff to act to exceed customer expectations. Then sit back and watch delighted customers ‘go social.’
Win loyalty and advocacy with differentiated service, rather than special offers — Our survey shows the majority of consumers value quality customer service over price. Focus on service quality and attention to detail, and the need for margin-slashing discounts and no-win price promotions diminishes.
Service is the New Marketing
Competing on price and focusing marketing on discounts and promotions can become an endless cycle treadmill. Our survey illustrates that promotions and discounts are not enough. Service is the new Marketing and should become the differentiator, leading to increased revenues through customer retention, incremental purchases from existing customers and new sales driven by word of mouth. Enhanced customer satisfaction through service quality can translate into longer-term customer relationships, increased lifetime value and advocacy.
II. The 21st Century Consumer
Dissatisfied, angry, frustrated and ultimately ambivalent — the picture painted by our survey into consumer attitudes across six countries is generally one of disappointment and disillusionment.
What we found was the 21st Century consumer is not fully satisfied with the customer service they receive from the organisations they deal with. Overall, less than half (49%) of respondents claim to be satisfied, with 22% dissatisfied and 26% claiming they are neither satisfied nor dissatisfied.
Results revealed that the lowest satisfaction levels occur in Government/Public Sector (28% satisfied, 41% dissatisfied) and the highest in Retail (67% satisfied and 7% dissatisfied).
In our survey, consumers responded that they had experienced numerous problems, including challenges in back-offi ce operations directly linked to:
• Rude or unhelpful staff — 24% had experienced rude and unhelpful Public Sector staff.
• Technical issues — 24% had experienced this in Financial Services (banking, insurance, credit cards, etc.).
• Lengthy resolution times — The worst offender was the Public Sector (26%).
• Ordering mistakes — 26% of Retail consumers had ordered one thing and received another.
• Chasing for updates — 19% of Phone/TV/Broadband consumers have had to chase their supplier.
• Account/billing errors — 17% of consumers experienced Energy account and billing errors.
Some consumers shout their dissatisfaction from the metaphorical rooftops; others vent their frustration at an unfortunate contact centre agent. But the overwhelming response of many is apathy and inertia — they’re neither satisfied nor dissatisfied; they’ve lost faith; their expectations are low; they believe it’s not worth complaining; they can’t be bothered to go to any effort to try and get better service or better value. And in a world where suppliers are focused on discounts and price promotions, our survey found an overwhelming majority say price isn’t what matters.
So where are companies going wrong? And what can be done to deliver on service and engage the modern consumer?
III. Service Trumps Price
Today’s consumer places a premium on good customer service. When asked whether they agreed or disagreed with the statement ‘Price is the only thing that matters to me — service is secondary’ more than twice as many disagreed (48%) with the statement as agreed (22%).
The survey found that consumers still place a premium on good customer service, and are generally disinclined to shop around for the best prices. For example, 39% have never checked the prices they pay for Financial Services on price comparison sites, and nearly half (48%) said they never check their Energy prices.
Most consumers are saying that service matters more to them than price. Organisations in every sector, however, persist in trying to win consumers over with price promotions and special discounts, whilst keeping them hanging on the telephone, passing them from one department to another and failing to resolve errors satisfactorily.
Regional Variations
Poland — Consumers in Poland were more likely to agree with the statement than any other region. Roughly equal numbers of Polish consumers agreed (32%) and disagreed (35%) with the statement.
Russia — The highest percentage of consumers who disagreed with the statement came from Russia, where more than half of those surveyed (55%) disagreed that price was the only thing that mattered to them.
France — Price seems to matter least to French consumers, who are the least likely to check retail or services price comparison sites.
IV. Angered by Delays and Errors
Consumers are tired of avoidable mistakes, and they don’t like being kept waiting unnecessarily. Becoming the victim of avoidable mistakes, such as billing errors, makes a majority of people (56%) angry. An even greater percentage is made angry by being kept waiting unnecessarily (64%).
Account errors are most common in Energy suppliers (17% of respondents had experienced these), and ordering mistakes are most commonplace in Retail (experienced by 25% of respondents). Of some concern is the revelation that 24% of respondents report technical errors with Financial self-service systems, such as online banking, ordering and payment systems.
Account errors are most common in Energy suppliers (17% of respondents had experienced these), and ordering mistakes are most commonplace in Retail (experienced by 25% of respondents). Of some concern is the revelation that 24% of respondents report technical errors with Financial self-service systems, such as online banking, ordering and payment systems.
Regional Variations
France — French consumers would seem to be more forgiving sanguine with fewer angered by avoidable errors (34%) and unnecessary waits (34%).
Russia — Russian consumers are most angered by avoidable errors (65%).
Germany — German consumers are most angered by being kept waiting unnecessarily (82%).
Consumers are increasingly prepared to talk about their experiences — good and bad — on social media, with the preferred medium being Facebook (used by 19%), followed by posting comments on blogs or news websites (used by 11%).
When age is factored in, the results suggest, perhaps not surprisingly, that younger people are more inclined to ‘go social’; and the inference from this is that this trend will only continue to grow.
The impact of a dissatisfied customer ‘going social’ can be huge, and recent examples where consumers have made YouTube videos or blasted their Twitter followers with details of their grievances have reached millions of people. Topping the list is the US at nearly 50%.
VI. The Ambivalent Consumer
Many customers experienced mistakes, including billing errors and ordering mix-ups. Some sectors were worse than others, with 22% of respondents experiencing errors in Financial Services (banking, finance, insurance, credit cards, etc.). Yet it’s apparent that consumers are prepared to let companies make a few mistakes before they start thinking about changing provider, with 44% of respondents in total agreeing with the statement.
Poor service persists, and consumers do not readily identify themselves as ‘satisfied.’ What emerges, as a result, is a picture of ambivalence or inertia, where consumers, whilst dissatisfied and even angered by errors and poor service, are disinclined to do anything about it. They tolerate mistakes; many don’t visit price comparison websites, and only 15% say they resort to emotions, such as anger and flirting (‘playing the game’), to get what they want.
Does this imply a degree of resignation — that consumers expect that service will be less than satisfactory? Is this why mistakes and poor service do not spur consumers into action, to seek a better service elsewhere? Does it imply that consumers do not expect things to be any better with an alternative supplier?
Regional Variations
Poland — Most tolerant would appear to be Poland, where 59% of respondents reported that they would let companies make a few mistakes before thinking about changing provider.
France — Consumers in France, whilst least likely to get angry over mistakes and unnecessary waits, are also least inclined to let companies make a few mistakes, before they start thinking about changing provider.
VII. Unresponsive to Traditional Marketing
Another significant feature of the ‘ambivalent consumer’ is that they have become relatively immune and unresponsive to conventional marketing messages and price promotions. A total of 43% of responders reported that they do not read or respond to marketing messages or special offers.
This presents a challenge for suppliers in terms of reaching and infl uencing consumers. It suggests that traditional approaches are having less impact, but why would this be so? Is it because the 21st Century consumer is more ‘savvy,’ more resistant to being sold to? Or are they simply disengaged and disinclined to pay attention to communications from suppliers that are failing to provide them with satisfactory customer service?
Interestingly, across every region (with the exception of France), consumers that are more likely to read and respond to marketing messages, are less likely to agree with the statement that price is more important than service. This suggests that to achieve impact, marketing needs to be linked to service — and not to price.
Regional Variations
Russia — Russian consumers appear to be more responsive, with 45% agreeing that they responded to marketing messages or special offers.
France — French consumers are most unresponsive to marketing messages, with 60% disagreeing with the statement.
VIII. Service Providers’ Points of Failure
Our survey suggests that organisations are failing consumers in two key areas:
Lack of understanding of consumer needs and expectations
The findings point to a lack of understanding of consumer priorities, attitudes and expectations. In failing to understand the issues that frustrate and anger the consumer, suppliers risk focusing their attentions on aspects of their offering, which may be of lesser significance to the consumer, and missing the opportunity to address the things that matter most.
What’s needed is a thorough feedback and insight mechanism to enable the supplier to pinpoint consumer frustrations and service failures early on and address them. When the supplier is able to listen to the Voice of their Customer, the insight they gain can help them address the issues which matter and not waste valuable resources focused on the wrong things.
Customer feedback, both structured (such as post-call surveys) and unstructured (emails, in-conversation feedback, social media, etc.) is a life-blood of organisations seeking to improve customer satisfaction. The supplier that is able to analyse trends and emotions, uncover early responses to changes in service provision and gather data on marketing campaigns, can gain valuable competitive advantage whilst enhancing their brand value.
Poor workforce planning and lack of process accuracy
Customers don’t like being subjected to unnecessary delays, nor do they appreciate errors in their accounts, billing or other processes. These things make them angry and whereas they’re not generally inclined to rush away and fi nd a new supplier at the fi rst sign of a problem, they become dissatisfi ed and ambivalent — emotions which are the enemy of brand loyalty and advocacy. They’re also increasingly inclined to voice their dissatisfaction on social media, with the consequent damage to brand perception.
What’s needed is Workforce Optimisation within the contact centre and back-office functions (process/ administration/order management/account management) to manage staff scheduling and resourcing to meet demand, and to enhance quality, process accuracy and efficiency.
Front- and back-office support functions are inextricably linked, as failings in the back-offi ce (delays and errors in process, account management, etc.) can stimulate additional calls to the contact centre. Getting things working more efficiently in the back offi ce can help reduce load on the contact centre and in turn, help build customer satisfaction, reduce call waiting times and decrease the incidence of call backs.
IX. Strategies to Build Customer Delight
The survey clearly identifi es that differentiated service is favoured over price — service really is the ‘new marketing.’ With differentiated service, suppliers can retain and engage customers; more than this, they can build customer loyalty and advocacy and become the suppliers that everybody talks about — for all the right reasons.
Improve resource planning
Long wait times and process-related errors are infuriating for consumers and are tell-tale signs of poor workforce planning in the contact centre and back-office supporting functions that help shape the customer experience. Implementing Workforce Optimisation — quality monitoring, analytics, forecasting, staff scheduling and process optimisation — can help eliminate bottlenecks and service failures in both the contact centre and back office.
Listen to the Voice of the Customer — and act on it
Where price is less important and service is what differentiates service providers, it’s vital to understand customer expectations and deliver on them in order to delight the customer and build brand loyalty. Voice of the Customer Analytics — speech analytics, text analytics and enterprise feedback management — can help deliver insight into a vast resource of structured and unstructured customer data and represent an unrivalled source of customer insight. Knowing what customers want, understanding what’s impacting their satisfaction and spotting problems before they escalate are all critical to suppliers seeking to be responsive and customer-focused. Special attention should be given to addressing the new social-savvy customer and to unlocking the feedback from invisible and apathetic customers — those who don’t respond marketing efforts and don’t even bother to complain.
Make ‘Surprise and Delight’ service the rule, not the exception
Service must be at the heart of customer retention efforts. ‘Surprise and Delight’ service is delivered as much through cultural change as through the technology systems which help to deliver effective resourcing, process accuracy and efficiency. It will be those suppliers who ‘go the extra mile’ that get talked about in positive terms and recommended to friends and family and over social media.
Build loyalty and advocacy with differentiated service, rather than special offers
Discounting and endless price promotions can impact margins and profitability and set expectations which must then be met continually — it’s a never-win situation. When the supplier delivers on service quality and exceeds expectations, the need to stimulate the market with discounting and special offers is lessened. One has only to consider the credentials of certain much loved and valued brands that are exceeding market expectations in a challenging economic climate and whose names are rarely associated with special offers and ‘cheap as chips’ pricing.
Conclusion
Competing on price and focusing marketing on discounts and promotions can become an endless treadmill. Our survey illustrates that promotions and discounts are not enough. Service is the new Marketing, and should become the differentiator, helping drive increased revenues through customer retention, incremental purchases from existing customers and new sales driven by word of mouth. Enhanced customer satisfaction through service quality can translate into longer-term customer relationships, increased lifetime value and advocacy.
