December 7, 2012
Is Bad Customer Service PR's Worst Enemy? Consumers Are Defecting From Brands in Growing Numbers — But Majority Say, "You Could Have Kept Me," New Accenture Research Finds
In 2012, one in five consumers switched companies they buy from, including wireless phone, Internet service and retailers, according to new research released today by Accenture. This marks a five percent increase in switching over 2011 levels. However, the eighth annual Accenture Global Consumer Survey also found that the majority (85 percent) of consumers say the companies could have done something differently to prevent them from switching.
The survey, which polled more than 12,000 consumers in 32 countries, found that among those consumers who would have stayed if their provider had acted differently, two thirds (67 percent) pointed to having their customer service issue resolved during their first contact as a factor. More than half (54 percent) might have remained loyal if they had been rewarded for doing more business with their provider. The survey revealed that, of the ten industries covered, the largest rises in switching were among wireless phone providers (26 percent of consumers switched in 2012, up from 21 percent in 2011); Internet service providers (23 percent switched, up from 19 percent in 2011); and retailers (22 percent switched, up from 16 percent in 2011).
Broken promises are a top area of frustration for consumers, according to the survey: nearly two-thirds (63 percent) of respondents indicate it's extremely frustrating when a company delivers a different customer service experience from what it promised upfront. Seventy eight percent of consumers say they are likely to switch providers when they encounter such broken promises. Other frustrations that make consumers more likely to switch include:
- Having to contact customer service multiple times for the same reason (selected by 65 percent of consumers)
- Dealing with unfriendly customer service agents (65 percent)
- Being on hold for a long time when contacting customer service (61 percent)
"The sobering reality is that 'tried and true' strategies for customer acquisition, loyalty and retention are struggling to keep pace with consumers who are perpetually in motion, more technologically savvy than ever, and increasingly unpredictable," said Robert Wollan, global managing director of Accenture Sales & Customer Services, in a news release. "The news this year is that customers want to be loyal but customer service often fails to meet their expectations. In the digital marketplace, companies must improve social listening capabilities and apply predictive analytics designed to quickly identify and respond to potential customer issues before problems arise."
Selling More With Tailored Experiences
The Accenture study found that a tailored experience is critical to a strong customer relationship. Nearly half (48 percent) of respondents say that, compared to 12 months ago, they have higher expectations of getting specialized treatment for being a "good" customer. A similar proportion (50 percent) say it is extremely important for customer service people to know their history so they don't have to repeat themselves each time they call.
Nearly a third (31 percent) of respondents prefer companies that use information about them to make their experience more efficient from one step to the next. However, only a quarter (24 percent) said their providers deliver tailored experiences.
Among the ten industries included in the survey, providers in the travel and tourism, retail banking and life insurance industries earn the highest marks for providing tailored experiences: 32 percent of respondents say travel and tourism providers offer tailored experiences, followed by 27 percent who say the same about retail banks and 25 percent about life insurance providers.
"To convince consumers to stay – and spend more – many companies will need to develop more tailored offers and interactions that connect with consumers' specific needs," said Michelangelo Barbera, managing director of Accenture Sales & Customer Services in Europe, Africa and Latin America, in the release. "Taking such proactive steps to keep customers requires companies to use analytics to mine the vast stores of data they possess to gain greater insight into customers' desires and intentions and behave in the ways that customers want them to. Failing to use that data equates to not listening and can result in customers searching for someone who will."
Corporate Websites, Expert Review Sites Top Social Media Influence
As technology provides an ever-growing number of channels for consumers to interact with companies, the Accenture survey found that on average consumers use five to six channels to learn about and select providers, including:
- Word of mouth, relied upon by 79 percent of consumers to get information about providers
- Corporate websites, used by nearly three-quarters (71 percent) of consumers
- Online sources such as expert review sites, news sites and product comparison sites, used by nearly two-thirds (63 percent)
- Social media sites such as Facebook and Twitter, used by 47 percent of consumers
Looking more closely at the influence of social media, the survey found that 31 percent of consumers say they trust comments posted by people they know, echoing the importance of word of mouth. More than a quarter (28 percent) say positive comments in social media affect purchasing decisions and 28 percent say negative comments do so.
"Consumers, particularly in North America, appear to be migrating to increasingly polarized camps: one group that prefers traditional interactions, such as telephone, and one tech-savvy group that demands seamless interactions across all digital platforms," said Kevin Quiring, managing director of Accenture Sales & Customer Services in North America, in the release. "Many companies, however, approach their customers with a decades-old, 'one size fits all' sales and service model that they must evolve to satisfy the different ways consumers want to interact with the companies they buy from."