During the past year, I’ve reported on surveys by the Strativity Group and Right Now Technologies that say that customers will spend more with companies that provide excellent service and that they feel duty-bound to tell others about bad experiences. This week, American Express released a new customer service survey that confirms and adds to the understanding that customers will base their purchasing decisions on how well they or others are treated.
If three surveys (and probably more) in one year are saying the same things, why aren’t companies getting it? Do they think that the attitudes don’t apply to their customer relationships? Or have they forgotten why they’re in business? (Hint: to serve their customers)
Here are some highlights from the U.S. portion of the American Express Global Customer Service Barometer, which was conducted in the U.S. and 11 other countries:
- Americans will spend 9% more with companies that provide excellent service (Strativity said 40% of customers are willing to pay an additional 10%)
- In the current economic climate, only 37% of Americans believe that companies have increased their focus on providing quality service, 27% say these companies have not changed their customer service attitudes, and 28% say that companies are paying even less attention to good service than before.
- One in five feel companies take them for granted.
- 81% are more likely to repeat business after a good service experience and 52% will never do business with a company again after a poor experience.
- 91% of Americans base their decision to do business with a company on its level of customer service.
As we also know, the internet has changed the landscape of communication about customer experiences, but here are some actual numbers from the American Express survey:
- 48% use online postings or blogs to get others’ opinions about how companies treat their customers
- 57% put more emphasis on negative blog and social networking reviews than on positive ones.
What are your customers saying about you?
Frankly, these statistics should not be surprising. All you have to do is have casual conversation about service with people you know. As a consultant in customer experience, I could write a book on how people feel about the companies they do business with based purely on anecdotal evidence. When people hear what I do for a living, they often say, “Let me tell you a story about what happened to me …”
The news isn’t all bad. Some 86% of customers say they’re willing to give companies a second chance if their previous experiences have been great and 50% of Americans say it usually takes two bad service experiences before they’ll walk away.
Worldwide, consumers in 11 of 12 countries surveyed feel customer service has become more important in the current economy (The only exception was the Netherlands. Maybe they’re too focused on the World Cup).
While we aren’t surprised, companies still can’t figure out how to claim that “Great customer service” mantle. Maybe it’s because 80% of companies believe they provide a superior customer experience but only 8% of consumers agree (Bain and Company, 2005).
Here are some things you can do:
- Analyze each of your customer touch points. Where do you touch the customer? How well are you doing in that touch point? What can you do to improve the experience during that touch point?
- Make each customer feel that you are on his or her side. Be a customer advocate. If you’re worried about spending the company’s money, remember the statistic about how much more happy customers will spend.
- Give your people the authority to act on behalf of the customer. Companies quash this authority with everything from overbearing, ridiculous rules to providing scripts that tell customer service representatives what they can and can’t say. We have all had too many experiences where we just knew the employee would do something right for us but was restrained by management.
The numbers in these surveys don’t lie. None of these surveys are outliers – totally different from the others. They say the same thing: Customers will pay more and do more business with companies who provide excellent experiences and they will gladly spread the word about companies who don’t. If your company’s customers are not in the first category, you’re doing something wrong.
Tags: American Express, bad experience, bad service, Companies don't get it, customer experience, Customer Experience Ownership, customer service, customer service surveys, customer surveys, Global Customer Service Barometer, impersonal service, surveys, upset customers