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Poor customer service costs United Kingdom businesses £15.3 Billion per year

Financial services, utilities and telecommunications firms at most economic risk from poor customer service


Birmingham, U.K., September 23, 2009 – According to a new national survey of consumers the cost of poor customer service in the U.K. is a significant problem: U.K. businesses lose a total of £15.3 billion each year when customers defect and abandon their purchases as a direct result of poor customer experiences.


A total of 514 U.K.-based consumers were surveyed for the report titled “The Cost of Poor Customer Service: The Economic Impact of the Customer Experience.”  Consumers were asked about the frequency of their interactions with businesses via the web, through contact centres and with their mobile devices.  They were also asked to identify the impact of those interactions on their purchasing decisions.  The survey group identified their service priorities and indicated the changes most needed for improving the quality of their customer service experiences.  In addition to the £15.3 billion loss to the U.K. economy due to poor customer service, the survey uncovered these findings:



  • 73 per cent of U.K. consumers ended a relationship due to a poor customer experience

  • The average value of each lost relationship is £248 per year

  • 39 per cent of U.K. consumers said it is critical for companies to provide more intelligent self- service so they are not trapped in unproductive automated systems

  • 83 per cent of consumers welcome more proactive engagement if it improves their experiences

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 in the U.K was conducted by Greenfield Online.  The survey was sponsored by Genesys Telecommunications Laboratories, Inc., an Alcatel-Lucent company (Euronext Paris and NYSE: ALU), in collaboration with industry analysts at Datamonitor/Ovum.  The survey group represented virtually every age and income bracket of consumers in the U.K.  Datamonitor/Ovum reviewed the consumer survey data in conjunction with its proprietary contact centre 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 in the U.K 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."


The industries in which enterprises in the U.K. are suffering the biggest losses are Financial Services, Utilities and Telecommunications, which lose substantially more customers than companies in other industries.  Nearly one fourth of consumers said they abandoned a financial services company or utility in the past year.  Even industries that were previously safe from competition, such as utilities, must now pay closer attention to the customer experience.


 


Younger consumers are more likely to end relationships based on poor customer service than older consumers.  Survey participants who end a business relationship said they take their business to a competitor 66 per cent of the time.  The other 34 per cent of their business is completely abandoned.


The survey revealed the following significant root causes of poor customer service based on consumer sentiment:



  • Having to repeat information

  • Feeling trapped in automated self-service

  • Being forced to wait too long for service

  • Interacting with representatives who have no knowledge of the service history (or consumer value)

  • Unable to easily switch between communication channels

Most Challenging Communication Channels


The most challenging communication channel is voice self-service.  41 per cent of consumers cite voice self service as the most challenging communications channel compared to only 1 per cent who find it most satisfying.  And 39 per cent of consumers said it is critical to improve voice self-service to make it integrate more intelligently with human assisted service.


In customer service experiences where the consumer was ‘trapped’ in an automated system, consumers spent, on average, more than ten minutes trying to reach a live agent.  Even paper-based mail, which can be a considerably slower communications channel, is preferable to poorly implemented voice self-service systems.


Consumers say the biggest issues influencing their perception of voice self-service have to do with automated systems not recognising their unique value to the company, the lack of context during the interaction, and the need to more effectively recognise customer needs and intent.


Greatest Sources of Customer Satisfaction


Consumers were also 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

  • Personalisation

Proactive outreach emerged as an area in which consumers want greater engagement.  More than 83 per cent 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.


“Most businesses understand that turning the customer experience into an emotional engagement adds value to their brand and results in consumers who are more loyal and satisfied,” said Keith Pearce, Senior Director of EMEA Marketing, Genesys.  “It is important for businesses to continually gain perspective on the changing nature of customer service, as well as consumer perceptions of it.  We hope these survey results will provide enterprises with a better understanding of the opportunities and the challenges in delivering a great customer experience.”


For a complete copy of “The Cost of Poor Customer Service: The Economic Impact of the Customer Experience” survey in the U.K., please send a request to: press@genesyslab.com


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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.


Media Contact:


Duncan Burford, UK PR for Genesys, 01780 721 433, dburford@iba-europe.com


David Radoff, Genesys, +1 650.466.1078, dradoff@genesyslab.com