MARKET BRIEF

market Brief
Benchmarking Survey: Consumer Tipping Points - 2010 vs. 2011

ExECuTivE Summary This market brief presents the findings of the second annual consumer tipping points survey, which reveals what customer service issues frustrate consumers the most, and how they respond to negative experiences. We examined trends year-over-year to understand how customer expectations and perceptions are changing, and the hard-hitting impact to satisfaction, loyalty and revenue for businesses.

CONSUMER TIPPING POINTS BENCHMARKING SURVEY

Consumers still unhappy with teleCom and Cable Companies

1. as a customer, which of the following companies do you find the most frustrating to interact with? 2011 2010
27%
19% 20 % 25% 17% 14% 14% 11 %
10% 12%

please wait while i transfer your Call to the next representative

2. which of the following frustrates you the most?

2011
Having to speak with multiple agents and starting over every time

2010
42% 41%

Telephone

Cable

Being kept on hold for long periods of time

10% 9%

Healthcare

Insurance

Other

10% 7%

Bank

Utility

6% 8%

Rude or inexperienced representatives or service technician

9% 14%

Other
0

6%
11 %
10 20 30 40 50
Not getting what I need on the rst try

7% 8%

Telecom has replaced cable as the most frustrating industry to interact with in 2011 but both still top the list well above banks, insurance providers and healthcare companies. According to Forrester Researchs recently released 2012 Customer Experience Index (CxPi) rankings, TV, wireless and ISP providers lag far behind other industries, earning the lowest scores from consumers on interaction quality, convenience and meeting customer needs.

Not being understood by IVR/speech recognition applications

6% 7%

Frequent service interruption, disruption, gaps

6% 4%

Di culty logging in or navigating a website

4% 2%

Long windows to wait for a service technician

3% 2%

Fee/price increases

3% 5%
0 10 20 30 40 50

From 2010 to 2011, responses to the question, What customer service issues frustrate you the most? stayed consistent - the no. 1 most frustrating experience is still having to speak with multiple people and starting over, while no. 2 is now being kept on hold for long periods of time, followed by rude/inexperienced service representatives and not getting what I need on the first try. 2

CONSUMER TIPPING POINTS BENCHMARKING SURVEY Even with a rapidly evolving customer interaction landscape, consumers still value basic tenets of service like efficiency, effort, time, and good oldfashioned courtesy. Companies should engage in ongoing initiatives to measure the effectiveness of their automated and live service channels from the customers perspective, and not purely in terms of archaic metrics like average handle time (AHT), transfer rates and self-service containment as those only represent the organizations measure of their systems and operations, not the customers perceived experience. marketers so companies should capitalize on social media monitoring and analysis as a way to identify trends immediately to engage and respond to vocal consumers. Further underscoring the importance of advocacy and word of mouth, 68 percent of respondents will either tell family and friends about a negative customer service experience or post comments via social media. The debate over the role of social media has raged on recently with many struggling to find ways to monetize and measure the impact of sentiment, mentions and conversations on the customer experience. Organizations need a way to connect the dots between customer service interactions and social media activity to truly understand the impact and opportunity to capitalize on social networking.

unhappy Consumers getting even by spreading the word

how do you typically react to a bad customer service experience? (Select all that apply) 2011
Tell family /friends /peers about experience

2010
52% 51%

raNTS
I had to call numerous times for days, I was put on hold every time, I had to speak with inexperienced employees and explain numerous times to different employees the same thing I switched to another company and made sure

Ask for a supervisor /manager

51% 55% 35% 40% 27% 25 % 16% 21 % 13%

Cease doing business with the company

all my friends and relatives knew not to trust the company.

Submit negative customer satisfaction survey

Chat sucked and so did the agent. Rude and incompetent, the agent pushed me to tweet about it and push it to LinkedIn and Facebook, write a blog about it and

Post comments on social networking site or consumer review sites

send all the links to the executive management team and the investors.

Write letter/email of complaint

18 % 4%
Other

Company wouldnt budge on a late fee even though I had paid on time for 9 years so I dropped them. Best way to get even is to stop doing business with them customer always has the final say.
20 40 60 80 100

4%
0

In 2010 the top choice was ask for a supervisor, in 2011, it is tell friends/family about experience. Although both actions serve the purpose of communicating dissatisfaction and disappointment in an experience, spreading the word to external parties has an added consequence of damaging the brand and turning off future customers. McKinsey recently released research focusing on how the influence/advocate state of the consumer decision journey is the most critical for

I had such repeated and unsatisfactory support interactions after multiple hardware failures within the first year with [company] that I emailed one of the company VPs to express how poor their service was and assured them I would never buy another [brand] product I share my experience with anyone I know who is considering doing so.

CONSUMER TIPPING POINTS BENCHMARKING SURVEY The impact of poor customer experience on a companys bottom line is also evident: 35 percent of consumers said they would cease doing business with an organization after a poor customer service interaction. Organizations need a way to understand which customer journeys are driving attrition to proactively retain customers going down similar paths.

Word-of-mouth has a ripple effect on other consumers. More than 60 percent of consumers are influenced or very influenced by other consumers comments about companies.

loyal Customers outraged

for the experience where you reached a breaking point, were you a new or established customer?
2011
1% 3% 1%

2010
3%

- Social Media for

Customer Service Survey, ClickFox, 2011

14%

13%

82%

83%

An established customer

A new customer

Recently out of service

Other

In both 2010 and 2011, more than 80 percent of consumers surveyed who reached their tipping point after a bad customer service experience were established customers. Organizations should shift their primary focus from acquiring new customers to retaining and growing existing relationships for driving profitability and loyalty.

happy Consumers less voCal, more loyal

how do you typically react to exceptional service?
Tell friends/family /peers about experience

42% 23% 15% 8% 7% 5%

0 10 20 30 40 50

Submit positive customer satisfaction survey

Purchase additional products or services Post comments on social networking site or consumer review sites

Write a letter/email

No action

CONSUMER TIPPING POINTS BENCHMARKING SURVEY On the flip side, consumers in 2011 revealed how they react to exceptional service more than 40 percent would tell friends and family about a positive interaction and 23 percent would rate the experience on a satisfaction survey. Interestingly, only 8 percent of respondents would post positive comments on social media sites vs. 16 percent who would rant about negative experiences. Bottom line: ticked off consumers are much more vocal than happy ones, and have greater potential to cause brand damage. They also present a huge opportunity for organizations to build trust and salvage relationships by meeting or exceeding a customers expectations in resolving an issue.

A USA Today article, For some consumers, surveys breed feedback fatigue, notes that response rates have plummeted in traditional surveys and polls by as much as 20 percent.

surveys: the voiCe of the voCal few

which of the following makes you more inclined to complete companys customer service survey?
A good experience

31% 30%

A bad experience

I always take surveys

20% 14% 5%
0 10 20 30 40 50

Other

I never take surveys

Consumer responses about drivers of survey participation remained consistent from 2010 to 2011 with around 30 percent indicating that they would complete a survey for a bad and good experience, respectively. It is interesting to point out that consumers are much more inclined to spread the word about their negative customer service experiences with others (whose purchase decisions are undoubtedly influenced via word of mouth), while they are reluctant to spend the time to directly share feedback via surveys with the company.

ravES
The CSR resolved the situation beyond my expectations I made sure the management staff knew and also told many in my network via face to face and social channels of the positive outcome from the negative experience. To my surprise, not only was my issue resolved beyond all expectations, it was resolved by the person who answered the phone! The way my situation was handled left me with complete confidence I was dealing with a company with integrity and genuine desire to value my business and keep me as a long-term client I will be continuing to do business with them and telling friends whenever an opportunity presents itself.

CONSUMER TIPPING POINTS BENCHMARKING SURVEY

ConClusion
As consumer expectations continue to rise, their tolerance for poor service decreases, and in this digital, connected world they have several forums for being heard. With the evolution of customer care from a traditional call center environment to today where consumers have endless ways to interact with companies, and more importantly peers, customers now own the relationship. Organizations relying only on traditional methods of measuring customer experience like satisfaction surveys, call center metrics and performance management will be left behind. Companies that are already integrating social media, marketing and customer care across the enterprise without being limited by siloed, disconnected strategies and operations are reaping the benefits of innovation. The most valuable tools for customer-centric enterprises are those that can tie sentiment and behavior to actual business outcomes so that organizations can identify the root cause of service issues, understand the direct impact of poor experience on satisfaction and loyalty and proactively anticipate customer needs. ClickFox continually conducts industry research on customer experience trends to help todays organizations stay ahead of the game. Our quarterly consumer market research spans topics from customer interaction preferences to customer service frustrations to the impact of social media and mobile commerce on customer experience. If you have a topic you would like to see covered in the future, please email us at info@clickfox.com.

aBouT CliCkfox
The leader in a new breed of experience analytics, ClickFox maps the complex maze of customer experience journeys formed by interactions at every touch point with a company. Unlike business intelligence tools, ClickFox links disjointed, cross-channel data to fully understand and analyze customer behavior in a holistic view. Using ClickFox, businesses can optimize performance to improve loyalty, raise revenue, cut costs, enhance reputation, drive business strategy, and predict future needs -- all with breakthrough speed and scalability. ClickFoxs patented technology can be installed in weeks to deliver a clear picture of unstructured data and drive better decisions. Working with ClickFox, Fortune 500 leaders in telecommunication, financial services, media, utilities and healthcare organizations collectively have added more than $1 billion to their bottom lines.

www.CliCkfox.Com
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