During the recession, shortsighted businesses competed on price rather than level of customer service. It turns out that the consumer noticed and in big numbers is reacting now by taking his or her business elsewhere.
According to the American Express® Global Customer Service Barometer, 78 percent of consumers have bailed on a transaction or not made an intended purchase because of a poor service experience. Further, three in five Americans (59 percent) would try a new brand or company for a better service experience. Most surprising and disturbing is the finding that consumers are willing to pay a premium for a good interaction.
According to the study, seven in ten Americans (70 percent) are willing to spend an average of 13 percent more with companies they believe provide excellent customer service. This is up substantially from 2010, when six in ten Americans (58 percent) said they would spend an average of 9 percent more with companies that deliver great service.
As to whether “help” is enough, two in five (42 percent) said companies are helpful but don’t do anything extra to keep their business. Also, one in five (22%) think companies take their business for granted.
The survey is generally in line with global findings from Accenture which reported earlier this year that satisfaction with customer service has decreased since 2009 in each of 11 characteristics measured. Also, 64 percent of consumers have switched companies in the past year due to poor customer service. Accenture findings point to a high level of distrust. Only one in four respondents say they trust the companies with which they do business, according to the survey.
Missing from the survey is detail on what consumers do with their mistrust? Do they use their mobile phones to get on social networks or text when companies fail at so-called “Moments of Trust”? Do individual tweets, blog posts and Facebook postings influence sales and loyalty? I’ve commissioned a study and will release the findings in June when I speak on the subject at Jeff Pulver’s 140 Characters Conference in New York. (Article first published as Paying The Price For Customer Service on Technorati)