"66% of consumers switched brands due to poor customer service"
Today I read an article about the future of customer service. It stated (as highlighted below), that "66% of consumers switched brands or business due to poor customer service" and "82% of those who switched said the brand could have done something to stop them". This reminds me of several of my own experiences and also highlights how much the market has changed.
Switching used to be difficult
Several years ago, many of us continued to use the same brand or company for ages, as it was easier than switching. Mobile phones and car insurance are an excellent example of this. The customer service could be poor but switching insurer or mobile service provider and having to go find a better deal was a complicated and often stressful thing to do, so we just put up and shut up. However, now, the internet has made things a lot easier:
- We can find other, much better deals in a few clicks of a button.
- Now as consumers, we are more savvy than ever.
- We regularly switch our utilities to keep prices low and our insurance policies to not get hit with renewal fees.
Why don't they want to keep us happy?
So why aren't these big businesses, that are constantly competing to offer us the best deal, not competing to keep us?
Often when we there is little difference between what is available the competitive differentiator will be the customer service we have received. If my current car insurer offers me a deal that is £50 more a year than what is offered on a comparison site, but my current insurer also offers great customer service, this will sway my decision to stay.
Great customer service and customer loyalty go hand in hand
Are these businesses dropping prices to compensate for poor customer service? Or do we, as consumers, now care more about costs than service? We all know that cost will, of course, always be a factor when buying products and services - but great customer service can make all the difference! It has certainly swayed me on several occasions!
For me, it's very simple
Great prices bring new customers in and great customer service keeps them. Loyalty not only keeps the monthly recurring revenue (MRR) flowing, but it also provides you with customers who champion your brand. So, where are these businesses going wrong, if up to 66% of consumers are switching solely because of a negative customer experience? Maybe they're not investing in customer experience because they don't realise that it would actually be more profitable in the long run?
In a competitive market, with smarter customers, businesses need to be smarter and customer experience needs to be a priority.
Globally in 2013, 66% of consumers switched brands or business due to poor customer service, a 4% increase on the previous year. Some 82% of those who switched said the brand could have done something to stop them.