Poor Customer Service Results In $331 Billion Revenue Loss ; Digital Medium Triggering More Brand Switching
We all experience bad customer service from one company or the other; we all know the frustration of being transferred from one operator to the other, from one voice prompt to the next when it comes to resolving some major issue.
After all, it’s the experiences which matter when it comes to a brand, and if that experience is bad, then we don’t hesitate to switch loyalty.
But have we wondered how much it costs for providing such poor customer service and for switching brands?
Accenture has just released their Consumer Pulse Survey in India, and there are some pretty interesting stats out there, especially related with poor customer service and it’s impact on the corporate sector.
As per the findings of Accenture, $331 billion of revenue is lost, solely due to poor customer service experience by customers. Such is the magnitude of this problem, that 88% of Indian customers are likely to switch atleast one company due to bad customer care experience.
Accenture has termed this as ‘Customer Switching Economy’ and due to repeated instances of bad customer service; this economy is growing at a healthy pace.
Key negative customer service experiences in India
Internet and Banking are the industries which are most prone to such brand switching due to poor customer service: switching behavior in these two industries have been pegged at 41% and 46% respectively. Overall, only 26% of customers are satisfied with their preferred brands, and are willing to continue the relation.
However, out of these 88% of potential brand switchers, 86% admitted that the companies could have done something positive to prevent this exodus.. And 56% are even willing to provide a second chance to their preferred brands. This means that brands and companies do have that small window for improving their services, but unfortunately, very few companies are actually doing it.
The Digital, Restless Customers Need More From Brands
The report highlights one crucial fact that the new age digital economy has fueled brand switching, simply because the mobile internet powered customer is restless for high quality service; and more importantly, the next brand is only a click away!
5 interesting facts regarding the digitally connected customer:
- 70% of customers who use digital medium to access their services, are using mobile to do so
- 65% of these customers strongly believe that companies which offer Internet based customer service are better than those which doesn’t provide such luxury
- 71% of all Indian customers read online reviews before choosing a service
- 47% of all Indian customers will select a company solely because they will interact with them online
- 80% of all Indian customers (against 61% globally) believe that the usage of technology has greatly improved customer service experience.
Now, against this backdrop of information, if we analyze the ‘customer switching economy’ of $331 billion, then things will suddenly become crystal clear for us: As more and more customers are able to use technology for every day needs, their level of expectations is also steadily increasing, and they want more from the brands.
They need that touch of personalization, the focus on their needs and the pampering via social media interactions.
Key reasons for switching due to poor customer service in India
And God forbid, if the brand is not able to provide these, then they will simply switch their loyalty. As mentioned in the report, 44% of the Indian customers will leave a brand for lack of customized service and 88% of them will talk about their negative experience with the whole world!
The report once again proves that famous quote from David Ogilvy: “The customer is not a moron. She’s your wife”