U.S. consumers are rewarding great customer service more than ever, according to the American Express 2014 Global Customer Service Barometer. The survey, which explores consumer attitudes and preferences on customer service, found that outstanding service prompts customers to open both their wallets and their mouths.
More than two thirds of American consumers say they’re willing to spend 14% more on average with a company that they believe delivers excellent service. That compares to 13% in 2012 and 2011, and 9% in 2010, the first year of the American Express survey.
In addition to spending more, nearly half of the survey’s respondents say they always tell others about good service interactions (46%), telling an average of eight people. According to the study, word of mouth is most effective in influencing customer behavior: Two in five Americans (42%) say that a recommendation from a friend or family member is most likely to get them to try doing business with a new company, even more than a sale or promotion (34%) or a company’s reputation (15%).
“Good service is good business because it creates impassioned, loyal customers,” said Kelly Fisher, Senior Vice President, Relationship Care Strategy, American Express. “Those engaged customers spend more and share their excitement with others, which often influences their buying decisions. It’s why willingness to recommend a product or company to a friend has become such an important measure for service companies. Service can really be a powerful way to drive the growth of a business.”
American Express reports that its own customers confirm the finding of customers voting with their wallets. Service promoters, or customers who are highly satisfied with their service interactions, spend 16% more on their American Express cards than those who aren’t. The company primarily measures customer service satisfaction by asking customers how likely they are to recommend American Express based on a service experience.
“Globally, our Recommend to a Friend scores are at all-time highs because of the customer care delivered by our award-winning team,” Fisher said. “We try to make every interaction an opportunity to deepen our relationship with the customer. That’s what our Relationship Care® brand of service is all about.”
Everybody’s talking about service
While 46% of American consumers say they always tell others about good service experiences, an even greater number say they talk about poor service experiences. In fact, 60% said they always share the bad ones, and they tell nearly three times as many people (an average of 21 people vs. 8 people).
“People are going to talk about your service, one way or another, so what do you want them to be saying?” asks Fisher. “In an environment where the recommendation of a friend is so important in driving a consumer’s purchasing decisions, creating good service experiences is extremely important.”
Even in a digitally connected world, consumers’ preferred method for talking about their service experiences is still face-to-face conversation. Nine in ten consumers say they tell others face-to-face about their service experiences – good or bad. In addition, 50% are using company websites to talk about customer service, followed by text messaging (49%), social networking (47%) and consumer review websites (46%).
While the reward for providing great service continues to climb, so too does the cost for getting it wrong. Three in five Americans (60%) have walked away from an intended transaction in the past year due to a poor service experience, up from 55% in the most recent survey fielded in 2012.
And, with poor service, patience is not a virtue. In fact, 37% of consumers say they will switch companies after a single poor customer service, while another 58% were willing to endure 2-3 instances of bad service. That means that for 95% of American consumers, businesses get three chances at most to get customer service right.
Overall, Americans are expecting more from companies when it comes to service. Thirty-eight percent believe that companies are paying less attention to providing good customer service in this current economy, a 6% increase compared to the last survey in 2012 (32%). Also, only 5% of Americans say that companies are exceeding their customer service expectations, the lowest figure since the survey was first conducted in 2010.
Great service defined
The vast majority of survey respondents say that a personalized service experience is important to them and they want to be thanked for their business. But the ticket to entry in providing great service is first taking care of the customer’s needs.
Virtually all respondents said that getting a satisfactory answer (99%) or being connected to someone knowledgeable (98%) are the important prerequisites to great customer experiences. Once those core expectations are met, personalization (important to 89% of consumers) and appreciation (80%) are pivotal to an excellent service experience.
A similar theme emerged when Americans were asked to identify the most important attributes in customer care professionals. More than anything, customers want the person at the other end of the phone or the other side of the counter to be efficient (33%) and empowered (29%).
Customers want choice in how they connect with companies
Many customers prefer to handle simple inquiries themselves, but as issues become more complex, they tend to prefer contact with a real person.
More than half of Americans say that their preferred channel for simple inquiries is one of several self-service tools such as a company website/e-mail (36%), an automated voice response system (12%) or a smartphone app (9%). For more complex inquiries like returning a product or handling product issues, 37% prefer a phone call with a real person and 19% want to speak to someone face-to-face. And for even more difficult issues, such as making a complaint or disputing a charge, nearly three fourths want a real person to help them, either on the phone (48%) or in person (24%).
“Relationship Care doesn’t start when the phone rings,” Fisher said. “It means understanding your customers’ preferences and enabling them to connect with your company in ways that are most relevant and convenient for them so they can resolve their queries.”
Social media is growing as a channel for those seeking a customer service response, but is mostly used to praise good service or vent about a poor experience. Twenty-three percent of U.S. consumers have used social media to get a service response, up from 17% in 2012.
Takeaways for great customer service
Given how customers are rewarding outstanding service more than ever, American Express offers the following tips to companies seeking to bolster the service experiences they provide:
- Cherish your connections with customers. Service shouldn’t be a clean-up operation. Turning service interactions into relationship-deepening moments can strengthen your business.
- In everything you do, put the customer first. Start with what the customer needs. Customers can’t be wowed by personalized service if their basic needs aren’t met or their questions go unanswered.
- Service is a people business; give care professionals the freedom to shine. Customers want to be helped by empowered, efficient people.
- Measure success through the voice of the customer. Let customers tell you how you’re doing, and truly seek to improve based on their feedback.
About American Express World Service
American Express is a global services company, providing customers with access to products, insights and experiences that enrich lives and build business success. American Express World Service is the company’s global servicing network that delivers a unique Relationship Care® service experience, which focuses on creating a personal connection and helping customers get the most from their American Express relationships. World Service has been recognized as a service leader in many markets around the world.
Learn more at americanexpress.com and connect with us on facebook.com/americanexpress, foursquare.com/americanexpress, linkedin.com/company/american-express, twitter.com/americanexpress, and youtube.com/americanexpress.
About the 2014 Global Customer Service Barometer
The American Express® Global Customer Service Barometer is a study conducted by American Express and Ebiquity, exploring customer attitudes and preferences around customer service. Research was completed online among a random sample of 1,000 U.S. consumers aged 18+. Interviews were conducted by Ebiquity, a team of independent marketing performance specialists, between August 19 and September 2, 2014. The overall results have a margin of error of +/- 3.1 percentage points at the 95% confidence level. The same survey methodology was used in Canada, Mexico, the U.K., Italy, India, Singapore, Hong Kong, Japan and Australia.