I saw an article recently which suggested that the annual cost to businesses in the UK of bad customer service is in the region of £7.2 billion. In a sense this is a quite staggering amount but then in a sense it isn’t at all, because switching service providers has never been easier.
Gone are the days when changing bank accounts meant a million forms to fill in and contacting all of your direct debit payees individually – now, it’s as simple as clicking a button and in most instances your new provider will do all the legwork, so customers are voting with their feet more than ever before.
Accurate figures for this ‘switching economy’ are hard to come by, but Accenture have published an annual ‘Global Consumer Pulse Survey’ for the past nine years which makes interesting reading for anyone involved in a consumer-facing business.
Some key takeaways from the most recent version of this research include:
- Accenture estimates that the “Switching Economy” puts up to $5.9 trillion of revenue up for grabs for companies globally; with $1.3 trillion in the US.
- 51 percent of U.S. consumers switched service providers in the past year due to poor customer service experiences, up five percent from 2012.
- Switching rates were highest among retailers, cable and satellite providers and retail banks – making companies in these sectors the most vulnerable, but also giving them potentially the most to gain.
- The survey found that customers are increasingly frustrated with the level of services they experience: 91 percent respondents are frustrated that they have to contact a company multiple times for the same reason; 90 percent by being put on hold for a long time and 89 percent by having to repeat their issue to multiple representatives.
- There are also frustrations with marketing and sales practices: 85 percent of customers are frustrated by dealing with a company that does not make it easy to do business with them, 84 percent by companies promising one thing, but delivering another; and 58 percent are frustrated with inconsistent experiences from channel to channel.
Sobering stuff. Happily, however, the report also looks at the capabilities commonly exhibited by companies that were seen to deliver highly valued customer experiences. These include:
Hyper-relevance: Assure customers that the company is doing all that it can to understand them at a more personal level, including customizing their channel and interaction preferences. This means providing a more tailored customer experience with more customization and personalization through the use of predictive analytics.
Relationships at Scale: Digital gives businesses rich channels through which to communicate with customers in much more personal ways and manage relationships with customers at scale. Use digital to bring the intimacy of the corner store to all customers and then give them more convenient access and more tailored services that matter to them.
Seamless Experience: Creating a seamless experience requires a multi-channel approach. Integrate information and processes that enable customers to flow easily across different channels when and how they choose.
Inherently Mobile: Invest in mobile services and support capabilities that are a quick win with customers, and that help to deliver hyper-relevance and reduce costs.
Social Media: Harness social media in order to deliver up-to-the-second customer preferences, greater levels of trust, a mechanism for direct and dynamic interaction and more and more usable data upon which business decisions can be made.
None of these factors will come as a surprise to the majority of customer experience professionals – but knowing the theory and putting it into practice are two very different things, as the figures put against the value of the ‘switching economy’ demonstrate.