As it has with many other aspects in our lives, the Internet has certainly caused a revolution in the way we market to customers. There are dozens of new ways and hundreds of new channels for reaching new customers … and thousands of companies are seeing the potential! Unfortunately, in the process, it seems that people are forgetting that it costs up to 7 times less to keep an existing customer than it does to gain a new one. A Satmetrix report has shown that billions of dollars are being wasted every year on marketing to new customers, while poor customer experience means that customers are actually leaving as fast as they are coming in. This churn in the market is a supreme waste of time and money. Today we look at our general starting point in terms of customer experience, and how we can use customer service surveys and satisfaction surveys to minimise customer churn.
Cold, Hard, Customer Satisfaction Facts
Research released in mid-2010, commissioned as part of Satmetrix’s annual Net Promoter Score® Benchmark study, found some quite disheartening trends coming through loud and clear from their customer service survey and satisfaction survey results:
- 49% of people trust personal recommendations the most when looking for a new supplier, and
- Only 2% trust advertising the most
- 15% of people trust online consumer opinions the most when looking for a new supplier
Interesting reading when …
- Over 10 million consumers in the UK alone have switched suppliers of various products or services in the last 6 months.
- Around £14 billion is spent on advertising every year in the UK.
These satisfaction survey results tell us that you can reach around 64% of your entire audience, simply by treating your existing customers well enough to inspire them to recommend you to family, friends, or the web at large.
In another study completed in late 2009, it was revealed that most customers actually expect a poor customer experience. Only 30% of respondents in a customer service survey by Temkin Group said that they expected it to be easy to resolve a customer service issue in the computer or health insurance industry. Of ten major industries, in only one (apparel) did a majority of consumers (54%) expect it to be easy to resolve an issue.
So What’s the Problem?
Why the switching epidemic represented in the customer service survey results? While the reasons vary across the world and even within different industries, in this case the main reasons that consumers switched were:
- Unfair fees or charges (23%)
- Poor product or service quality (22%)
- Rude or disinterested employees (19%)
- Can’t get anybody to deal with their problem (12%)
- Discounts are offered for new customers but not for existing customers (7%)
- Call centres located offshore (5%)
However, these results come from consumers across a range of industries. So if you want to know how you can better serve your own customers within your specific industry, it’s wise to ask them yourself. In fact, one of the planet’s largest corporations, Microsoft, lists ‘Knowing your customers well’ as one of the essential steps in getting repeat customers. Some of the others include ‘Hire the right people’, ‘Staying in contact’ and ‘Connect with customers on a personal level’.
In order to meet your customers’ expectations, you first need to truly know and understand what those expectations are – and this first step is made easy with PeoplePulse’s customer service surveys and satisfaction surveys, so let us know if we can assist.
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Net Promoter, Net Promoter System, Net Promoter Score, NPS and the NPS-related emoticons are registered trademarks of Bain & Company, Inc., Fred Reichheld and Satmetrix Systems, Inc.