Customer Service Still Matters - Even More Than Ever

RightNow Technologies 2008 recently released their Customer Experience Impact Report conducted by Harris Interactive. I have written about RightNow a number of times (see - RightNow Offers New Features with August 08 Release) for the most recent. The survey polled 2,112 US consumers* online about how they engage with companies both online and via phone, what they find frustrating and how negative and positive customer experiences affect them.

For the third year in a row, an increasing number of consumers indicate they will stop doing business with an organization or company because of a negative customer experience. This year it was 87%, up from 80% in 2007 and 68% in 2006.

The study was done recently but before the real recent major down turn. However, the results indicate that the significance of customer experiences does not go down in bad financial times. More than half (58%) of consumers said they will always or often pay more for a better customer experience during a down economy. Consumers also said the most important thing companies could do to encourage them to spend more is to improve the overall customer experience. As a consumer I would agree with all of this.

In recent years, contact centers have faced mounting pressure to move from being a cost center to both supporting the customers and generating revenue. The study addressed this issue and found that more than half of consumers (58%) are at least somewhat likely to make a purchase during a service engagement, and 24% of them have already made a purchase based on an agent’s recommendation. This is consistent with my own experience. For one major telecom’s call centers, we found that call center agents who used the knowledge management system to improve the customer experience were three times more likely to successfully cross sell during the call.

This extends to referrals. They study found that 58% of consumers said outstanding service is the number one reason they would recommend a company to someone else; up from 51% in 2007. This beats service low prices (44%) and quality products/services (43%) in the recommendation-stakes. The flip side is that customers are almost twice as likely to tell others about poor treatment. The study found that 84% of US adults who had a negative experience with an organization or company said they would spread the word about a bad experience – up from 74% in 2007 and 67% in 2006. In addition, 26% of customers said they have sworn at bad service; 17% have shouted and 9% have felt sick. I stopped doing any of these things. I just do not go back.

These results are very similar to another Harris Study sponsored by Tealeaf – see Online Customer Experience – What is Going On? It found that nearly 9 out of 10 (87%) online adults who have conducted an online transaction in the past year have experienced problems. Those who experience problems conducting online transactions also reported feeling disappointed (55%), angry (41%), and confused (23%). As I said then, I usually feel all of the above even though I do not actively engage in the reactions found in RigthNow study. Tealeaf addresses the issue with web analytics (see Tealeaf Brings Visibility to Online Customer Experiences) and Rightnow provides technology to support online and call center customer support. (see Customer-centric CRM from RightNow). It seems these solutions can work together. Thanks to both of them for these complementary studies.

Comments

[WES]

As a former retail worker and waitress in college, and then working in a call center and moving up to be a supervisor of a call center; excellence was demanded of me. Now I demand it in others because I know it can be done. I have been on both sides I know how to be a good customer but I also know the job (in some aspects) so I know 98% of the time it isn't rocket science to get it right. Because of that I am probably one of the few that will actually broadcast good performance just as much as I broadcast poor performance. There are plenty of places for me to shop, and life is too short to spend it in a place that provides poor services. I would rather spend a little bit more for better service.

[Bill Ives]

Wendy - Thanks for your comment and sharing your experience. I agree. Bill