Trends & Insights

10 Statistics on the Cost of Bad Customer Service

By Kimberly Meyer - January 09, 2018

Good customer service is not a luxury and no company can afford bad customer service. Even very big brands have not been able to ignore frustrated customers ever since democratization occurred through the Internet and social media – bad reviews spread like wildfire. We’ve found ten figures that elucidate that a lack of investment in customer service is a costly business.

66% of the customers surveyed switch brands

Salesforce tells us where frustration can lead. In a study, 66 percent of the customers surveyed said they switched brands after a poor service experience. The follow-up costs are hardly calculable if your customers begin to buy from your competitors in the future.

82% of customers do not buy again after a bad experience

Yes, it can get worse. According to Zendesk, even loyal existing customers can leave a company when their problems are not solved or they have been disappointed with the lack of friendliness or the complicated service process.

58% are prepared to spend more if the service is right

The opposite is also true. American Express found out that high service quality not only leads to long-term loyalty; it also has a direct influence on a company’s short-term revenue. Happy customers like to give something back – and buy more.

79% tell others about their bad experiences

The majority of customers share their experience with families, friends and networks, and like to talk about it when a business has come up with something incredibly bad, according to Zendesk. This figure may be even more dangerous than the customer’s own dissatisfaction. The effects are not foreseeable and can hardly be managed.

72% discrepancy between self-perception and customer assessment

80 percent of companies think their customer service is great, but only 8 percent of their customers agree, according to Forbes. Only a few brands are still able to really satisfy their customers, not even mentioning to inspire them. The reverse is also true: The potential is great and fantastic customer service stories always make the best anecdotes.

79% of high-income households avoid brands for years

Households, which have an above-average amount of disposable income, usually consist of well-informed people who know alternatives and weigh up options. They expect brands to do their best – if they fail to do so, 79 percent turn their backs for years, says Zendesk.

81% try it alone

According to Harvard Business Review, it makes no difference to which industry you belong. The majority of your customers tend to want to get their bearings first. This is just one more reason to invest in intuitive self-service, chat and contact opportunities via social networks.

65% complain about channel chaos

Do you already have a presence on Twitter and Co.? Very good! But being on these is not everything. Customer service, which sounds different on every platform, troubles customers and is bad for the brand experience. According to this Accenture study, customer service has a substantial impact on a company’s overall image and should be consistent.

10% less satisfied customers in the tech sector

At 47 percent, nearly half of customers are dissatisfied with their technology provider. Forbes says that this number got worse between 2015 and 2017. Look at it this way: There are a lot of old and new customers, which you can convince in 2018 by providing great customer service!

A contact in customer service costs 10 dollars

The costs in customer service are increasing with higher customer expectations. The average price for a contact across all industries is 10 dollars, according to Harvard Business Review. The awareness that automation and chatbots are not universal remedies is growing. Combining them with personal channels such as walk-in service or call centers is what makes the difference. Bad service is just too expensive to cut corners in the wrong places.

Summary

Save yourself a lot of money in 2018 and invest in innovation and quality in customer service. 2017 has once again shown that a lack of focus on customer care and badly thought-out budget cuts are leaving their mark.

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About the Author

Kimberly Meyer

Kimberly Meyer is Head of Global Marketing & Communication at B2X.