2 in 3 Consumers Switch Providers Due to Poor Customer Service

February 1, 2012

accenture-customer-service-switching.jpg66% of global consumers reported switching providers in at least one industry in 2011 due to poor customer service, representing a rise of 3% from 64% in 2010 and 12% from 59% in 2009, according to [pdf] a survey released in January 2012 by Accenture. Surprisingly, consumers switched providers even as they reported increased satisfaction across a variety of service characteristics evaluated: for example, the proportion who were very or extremely satisfied with the politeness and friendliness of employees rose 7% points over 2010 to reach a majority, 54%.

Overall, 44% of respondents said their customer service expectations were higher than they were a year ago, although consumers were 90% more likely to respond that way in emerging markets than in mature markets (59% vs. 31%).

Consumers Want Knowledgeable, Friendly Staff

Data from “The New Realities of ‘Dating’ in the Digital Age” indicates that consumers placed the highest amount of importance on companies having employees who are knowledgeable and informed, as well as having employees who are polite and friendly, rating both a 4.5 on a 5-point scale. Having the service experience match the promise made by the company, and having customer service people who can deal with an issue without referring the problem to another person, followed closely (both at 4.4).

Consumers reported the lowest satisfaction with the amount of time they had to wait to be served, rating this variable a 3.1 on a 5-point scale.

Loyalty Programs Gain Acceptance, But Lack Persuasion

accenture-loyalty-programs.jpgParticipation in loyalty programs across most industries has steadily increased from 2009 to 2011, led by retailers, with 53% of respondents reporting participation in at least one program, up from 52% in 2010 and 45% in 2009. Wireless/cell phone companies trailed with a 34% participation rate (up from 19% in 2009), followed by internet service providers and banks (both at 31%).

Even so, consumers are not convinced: only 57% of loyalty program participants in the retail and wireless/cell phone categories said their participation persuaded them to stick with the companies that provided the programs, with most other industries around the 50% mark.

These results are mirrored by findings from a Colloquy report released in December 2011 that found increasing participation in loyalty programs but a high degree of cynicism about them. According to that report, although 74% of US consumers reported participating in rewards programs in 2011, a 9% increase from 68% in 2009 and a 30% increase from 57% in 2007, just 12% of US consumers strongly agreed that it pays to be loyal to their favorite brands, while only 17% said loyalty programs are very influential in their purchasing decisions.

Rewards Wanted, Though

According to the Accenture report, there has been a significant increase in the extent to which consumers want to be rewarded for being loyal, and want specialized treatment for that loyalty. 64% of consumers said they like it when they are recognized for increased business, and 65% like it when companies provide special treatment for doing more business with them, especially true in emerging markets (71%) when compared to mature markets (60%).

Accenture insight suggests that the disparity between this desire for recognition and the lack of effectiveness of loyalty programs owes to a failure by providers to identify when a business pattern with a customer changes and respond accordingly. This is likely due to most companies only recognizing major increments on their own terms (i.e. increments they predetermine for their loyalty programs), rather than the minor increments that matter to customers.

About the Data: The Accenture survey polled consumer satisfaction of more than 10,000 consumers in 27 countries in 10 industries (travel & tourism, life insurance, consumer goods retailers, consumer electronics manufacturers, retail banking, internet service providers, cable/satellite, wireline phone, wireless phone and gas/electric utilities), between September and October 2011.

45th Parallel Design Ad

Explore More Charts.

Pin It on Pinterest

Share This