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Survey of 16 Countries Shows Poor Customer Service Costs $338.5 Billion per Year in Lost Business
(Market Wire Via Acquire Media NewsEdge) SAN FRANCISCO, CA -- (MARKET WIRE) -- 11/17/09 --
According to a new international survey
of consumers, the cost of poor customer service in 16 major industrialized
economies causes businesses to lose a total of USD $338.5 billion per year
when customers defect and abandon their purchases as a direct result of
poor customer experiences. The hardest hit industries across all countries
surveyed are financial services, cable and satellite TV providers, and a
variety of telecommunications companies. The average value of each lost
relationship across all countries surveyed is $243 per year. Losses were
defined as transactions taken to a competitor (63% of the total) and
transactions abandoned entirely (37% of the total).
The survey asked consumers their priorities and the changes most needed to
improve the quality of their customer service experiences in:
Australia
Brazil
Canada
China
Czech Republic
France
Germany
India
Italy
Mexico
Netherlands
New Zealand
Poland
Russia
U.K.
United States
While many larger economies saw greater impact, the losses were not
necessarily proportionate to the size of the economy. For example, Brazil
and Mexico represented two of the top four countries impacted.
In the past year financial services firms saw more than $44 billion in lost
revenue. And cable and satellite TV providers alone suffered more than $37
billion of losses. Wireless carriers and Internet service providers each
had $36 billion in lost revenue. Landline carriers also lost $33 billion.
Best and Worst Rated Industries
Some industries that were hard hit, like financial services, also had some
good news. Financial services companies were viewed more positively than
negatively, while other industries, such as telecommunications, were not as
fortunate: negative sentiment outweighed positive sentiment by a two-to-one
ratio. Consumers were asked to select the industries that did the best and
worst job of customer service. The consumer's choice for best customer
satisfaction with industry is shown in blue, and worst industry is shown in
red. The most positive ratings are for consumer products,
travel/hospitality, and financial services. The most negative ratings are
for telecommunications and government.
Survey Sample
A total of 8,880 consumers, at least 500 from each country, were selected
from all age and income groups and surveyed for the report, "The Cost of
Poor Customer Service: The Economic Impact of the Customer Experience and
Engagement." Consumers were asked about the frequency of their interactions
with businesses via the Web, through contact centers and with their mobile
devices. They also were asked to identify the impact of those interactions
on their purchasing decisions.
Reasons Consumers Leave
Consumers across all countries cited key reasons that they leave. Assisted
service is well developed, with the overwhelming majority of consumers
saying their most satisfying experience occurred because of a capable and
competent customer service representative. However, self-service that is
not intelligently integrated with assisted service is a key area of
concern. Consumers feel the most significant root causes of poor service
are:
-- Being trapped in automated self-service
-- Being forced to wait too long for service
-- Repeating themselves
-- Representatives that lack the skills to answer their inquiry
Some interesting differences occur regionally. For example, in many
European locales, including Germany, the Netherlands, France, the United
Kingdom and the Czech Republic, a significant portion of consumers said one
of their greatest sources of frustration was being unable to reach customer
service without paying a charge for the call: 29% of consumers in Germany
said so; and in the Netherlands 25% mentioned this. Nearly 10% of Chinese
consumers also cited this as a source of frustration.
This survey represents the first large-scale attempt to place an economic
value on the lost revenue from customer service across all channels when
businesses do not measure up to consumer expectations. The 28-question
survey of consumers was conducted by Greenfield Online. The survey was
sponsored by Genesys
Telecommunications Laboratories, Inc., an Alcatel-Lucent company
(Euronext Paris: ALU) (NYSE: ALU), in collaboration with industry analysts
at Datamonitor/Ovum. The survey group
represented virtually every age and income bracket of consumers in the 16
countries surveyed. Datamonitor/Ovum reviewed the consumer survey data in
conjunction with its proprietary contact center models to produce the
results.
"With the rise of social media and increased consumer awareness the cost of
customer frustration continues to grow," said Daniel Hong, Lead Analyst of
Customer Interaction at Ovum. "We're advising enterprise businesses to
develop cohesive strategies that straddle all channels of customer
communication. The difference between delivering exceptional customer
service and merely providing acceptable service is pronounced.
Differentiating on service, especially in service-centric industries, such
as finance and telecommunications, is how enterprises can retain customers
in today's challenging business climate."
Common Wish Lists
There were some broad areas of agreement among consumers from many regions.
Three common threads emerged among all countries. First, consumers are
demanding better integration between self-service and assisted service,
including voice self-service and eServices. The most requested improvements
in all countries were to be able to start in voice self-service or the Web
and get live assistance from an agent, and to start in e-mail and have
better integration with agent-assisted service. In other words, "Don't ask
me twice."
Most Requested improvements
When asked what they would most like to see companies deploy to improve
service, 40% chose human service, but more than half of consumers chose at
least one new communication channel among their top choices. In other
words, "Treat my interactions as a conversation." Over 18% selected as
their first choice better integration of communication channels, 16% chose
enriched content such as video, and 16% chose Web assistants or avatars.
Greatest Sources of Customer Satisfaction
Consumers also were asked to identify the factors that make the biggest
difference in improving satisfaction levels. According to the data,
consumer satisfaction increases when companies meet four key needs:
-- Competency
-- Convenience
-- Proactive engagement
-- Personalization
Proactive outreach emerged as an area in which consumers want greater
engagement. More than 86 percent of consumers defined proactive engagement
as a "strong benefit" or would "welcome proactive assistance" when stuck on
the Web or in some form of self-service.
For a complete copy of "The Cost of Poor Customer Service: The Economic
Impact of the Customer Experience and Engagement" survey, please send a
request to: press@genesyslab.com
About Genesys Telecommunications Laboratories, Inc.
Genesys is the leading provider of software to manage customer interactions
over the phone, Web and mobile devices. The Genesys software suite connects
customers with the right resources -- self-service, assisted-service and
proactive outreach -- to fulfill customer requests, optimize customer care
goals and efficiently use resources. Genesys software directs more than 100
million customer interactions every day for 4,000 companies and government
agencies in 80 countries. These companies and agencies can leverage their
entire organization, from the contact center to the back office, to
dynamically engage with their customers. As a result, Genesys stops
customer frustration, drives efficiency and accelerates business
innovation. For more information, go to www.genesyslab.com.
About Alcatel-Lucent
Alcatel-Lucent (Euronext Paris: ALU) (NYSE: ALU) is the trusted partner of
service providers, enterprises and governments worldwide, providing
solutions to deliver voice, data and video communication services to
end-users. A leader in fixed, mobile and converged broadband networking, IP
technologies, applications and services, Alcatel-Lucent leverages the
unrivalled technical and scientific expertise of Bell Labs, one of the
largest innovation powerhouses in the communications industry. With
operations in more than 130 countries and the most experienced global
services organization in the industry, Alcatel-Lucent is a local partner
with a global reach. Alcatel-Lucent achieved revenues of Euro 16.98 billion
in 2008 and is incorporated in France, with executive offices located in
Paris. For more information, visit Alcatel-Lucent on the Internet:
http://www.alcatel-lucent.com
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Media Contact:
David Radoff
Genesys
+1 650.466.1078
dradoff@genesyslab.com
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