Research Findings: Customer Dis-service and Hostage Marketing

The customer service experience is getting even worse.

Results from our recent Huffington Post research regarding people’s experiences when calling Customer Service Call Centers indicates serious problems.

Only 32% report that their Customer Service Call Center experience was positive. For the balance: 47% had a negative experience and 21% were neutral.

This quote reflects the widespread frustration: “I daydream about suing them. From the product to the reps, they just don’t care about their customers.”

Especially troubling is the finding that customers are treated poorly because companies think of them as “Hostages, unable to go elsewhere”.

Consider these 5 quotes:

“If I wasn’t on a fixed income, I would pay the fees and break my package contract with Comcast … horrible”.

“I still give them my business, but only out of necessity.”

“I’m stuck with their service.”

“AT&T is the only game in town; I just have to deal with them”. “If I had a choice other than Comcast, I would take it.”

“I would be done with most of these companies if I had any choice in the matter”.

Let’s look at the impact of these negative experiences on 3 critical business metrics. Decreased likelihood to buy from the company: 64%. Creates a negative perception of the company: 85%. Decreased likelihood to recommend the company: 77%.

Based on the quotes above, it appears that more than 64% would report a decreased likelihood to purchase from the company if they were not “hostages” with few or no alternatives.

There were astounding benefits to providing a positive Customer Service Call Center experience. An increased likelihood to buy from that company: 94%. A positive perception of that company: 94%. Increased likelihood to recommend that company to others: 86%.

Given the significant impact of a positive experience, it is incomprehensible that companies are not investing in appropriate training and resources for their Customer Service Call Centers. All of our experience in improving the performance of Customer Service Call Centers indicates significant improvements to revenue (for case studies, click here).

Given that it’s 7 to 10 times more expensive to acquire new customers versus selling existing customers, companies should view customer service centers as profit centers. As long as they continue to view them as cost centers, they will look for ways to cut costs.

In a blinding glimpse of the obvious (BGO), companies should realize that this is the most expensive and self-defeating way to “save money”.

7 Insights and Actions to Improve Your Customer Service Call Center Experience

Based on the research findings, following are 7 insights and action items to improve your Customer Service Call Center experience:

1. Do not view Customer Service Call Centers as cost centers. These are revenue centers. In their rush to cut costs, companies must consider the financial ramifications of losing customers due to poor post-sale experiences.
2. Customers’ post-sales experiences have significant impact on repeat purchase likelihood and willingness to recommend the company.
3. The damage from poor Customer Service Call Center experiences is significant. Companies need to consider how many millions of dollars this is costing them.
4. Do not cut back on Training, Quality Control procedures and investment in Customer Service Call Centers.
5. Remember that it’s 7 to 10 times more expensive to acquire a new customer than to sell an existing customer.
6. Keep in mind that, per the research data, positive Customer Service Call Center experiences solidify the relationship between the customer and the company.
7. Companies should focus on the quality of customers’ experiences with their Customer Service Call Centers, regardless of where they are located. Plenty of horror stories were reported regarding in-house, U.S. Call Centers as well as outsourced centers. The important takeaway is that customers expect quality post-sale care regardless of where the center is located.