Last week I wrote two tweets about customer service; one congratulating our local train company on its good service and one describing why I wouldn’t use a local supermarket due to its poor service. This ‘even handed’ treatment of good and bad service appears to be rare.
Matthew Dixon, Rick Toman and Rick Delisi have written an interesting book on customer service and contact centres specifically. The book looks at the level of customer service provided and its impact on customer loyalty (propensity to repurchase, buy more over time and be an advocate of the company).
Based on a surveys of 97000 people who have had recent contact centre experience, Dixon, Toman and Delisi find that there is a 65% likelihood that poor customer service experiences will be told to others by word of mouth. By contrast there is only a 25% likelihood that positive service experiences will be passed on.
The bad news for companies is that in almost 50% of the instances where the customer has something negative to say about the service, they will tell more than 10 people. The impact is, of course, made worse by the use of social media.
Their conclusion is that ‘when it comes to customer service, the vast majority of the word of mouth that gets spread is just plain negative.’
Of course, a bad service experience doesn’t necessarily make a customer disloyal. Indeed it’s when Dixon, Tomas and Delisi explore why customers become disloyal due to a service experience that they come up with some interesting conclusions.
They find five links between the level of service offered and why customers are subsequently disloyal:
- Having to contact the company more than once about the same problem. This is by far the biggest driver of disloyalty
- Being the subject of generic service – making no effort at all to personalise the service. For example; standard scripting, non-committal responses and lack of ownership. An interesting conclusion by the authors is that ‘generic service’ is likely to be a prime driver of repeat calls as customers ring back to check information and resolution
- Having to repeat information and the effort that entails for the customer. For example, entering account numbers and being asked for them again when the agent comes on the line or repeating the same story to a team leader or other department
- Being ‘bounced around’ between departments. This includes being transferred to another team or using the web site but having to call because the question is not answered
- Having a perception that additional effort is needed to resolve issues when dealing with the company. This might be due to contact centre wait times, badly designed IVR (Interactive Voice Response), being put on hold while the agent speaks to someone else or poor questioning skills by agents.
Four out of the five reasons identified that link poor customer service with subsequent disloyalty relate to the amount of effort it takes for a customer to deal with the company. This leads the authors to the conclusion that ‘the role of customer service is to mitigate disloyalty by reducing customer effort.’ What often happens in practice is, of course, the opposite – for example, where the company encourages the customer to use their web site the minute they ring the contact centre.
It would be an interesting exercise to take a contact centre and explore how much of their systems and process improvements and staff training are really contributing to this focus.