Lousy Customer Service Costs UK Businesses £12 Billion a Year

Businesses are so focused on enticing new customers that they often disregard the value of their existing ones. The impact of this is highlighted in new research which...

Businesses are so focused on enticing new customers that they often disregard the value of their existing ones. The impact of this is highlighted in new research which estimates that UK businesses lose £12 billion every year as a result of poor customer service.

Customer service

The research, conducted by NewVoiceMedia, shows that 93% of respondents have switched business at least once in the last year because of poor customer service and a third of 16 to 24 year-olds will post online if they are unhappy with the service they are receiving.

The statistics are impressive, but not surprising. For years companies have focused on making customer service as cost effective as possible, rather than providing a genuinely valuable service. Now that social media has given consumers a public and increasingly powerful voice brands are paying a hefty price.

The flip side of this is that after receiving good service, 71% would recommend the company to others and 44% would use the company more frequently.

In social media, customer service has been something of an afterthought and is still very much in its infancy. Research tells us that whilst 70% of Marketing departments are involved in social media, only 19% of Customer Service teams are using social channels. As the buying power of Generation Y increases, brands will have to think carefully about whether they can afford to ignore it any longer.

Some companies, O2 being an obvious example, have really taken to Social Customer Service and are succeeding in treating customers as individuals and responding in a human voice. What we need is for that to be applied to all Customer Service channels and to see a joined up approach between them.

Social CRM is the next step, allowing Customer Service teams to see the complete picture when they are contacted by a customer. They need to know what that customer has said about them on Twitter, what conversations have taken place on other channels, whether that person is a regular detractor, and so on.

The technology is starting to catch up. Contact Centre Software providers such as Genesys and NewVoiceMedia are making moves to incorporate social, whilst social media tools such as Sentiment Metrics, Hootsuite and Conversocial are increasingly focused on the customer service space. Meanwhile, CRM solutions are busy trying to tie all of this together. As always, however, technology is only the enabler. What we need is a shift in attitude if we’re to see truly end-to-end social customer service.

Hear how leading brands including Sony, eBay, BskyB and EE are implementing Social Customer Service and Social CRM at our upcoming conference. Early Bird tickets for Social CRM 2013 (London) on July 8-9 are available online now.

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    […] it wrong and you risk losing customers. In fact, 93% of consumers have switched businesses at least once in the past year as a result of receiving poor customer […]

  2. Oliver Karstedt Reply

    It baffles me how, facing these kind of numbers, a lot of businesses still treat customer service as a necessary evil instead of an opportunity to elevate their business and beat their competition. Thank god for social media and the voice people have been given through it. It won’t take long until companies who deny their customers a great social customer experience will get left behind and eventually fall prey to their competitors who listen and speak to their customers. I can’t wait 🙂

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