New research suggests that 6 out of 10 consumers think that low prices will become more important to them when choosing where to shop and what to buy in the next two years. But according to the Institute of Customer Service (who carried out the research) companies need to offer more than just
discounts in order to keep their customers. In their survey of 10,000 people, a third of those asked said that they were prepared to pay more for good customer service.
The research also concluded that
businesses need to be understanding of the financial pressures their customers
face and offer a range of payment options. They should also consider giving
advice on budgeting and getting the most value out of products. Companies
should also gauge whether technology was the best solution to problems, and
when a discussion with a real person was a better option.
The Institute questioned consumers as
part of a regular review of customer service, at a time when prices are rising
at their fastest rate for 40 years and the costs of energy, fuel and food
continue to climb.
What does the research reveal?
More than 17% of those surveyed were
experiencing a product or service problem, the highest overall level since
records began in 2008. In particular, the quality and reliability of goods and
services was a growing problem according to the survey.
The cost of dealing with poor service
added to ongoing expenses for businesses. The institute estimated the
collective cost to be £9.24bn a month in staff hours.
A year ago, the Institute warned that
customers were fed-up of companies using Covid as an excuse for long waits on
the telephone or late deliveries - but that issue had now clearly been
overtaken by the issues relating to the cost of living.
The research also found that some
consumers have been violent and abusive towards staff in shops. An incredible
44% of frontline service staff say they have experienced hostility from customers
in the past six months - a rise from 35% during the previous six months.
A quarter of staff that have faced
increased hostility said they believed the increase was partly down to the
sharp rise in the cost of living and the stress this had placed on customers.
Other research from Citizens Advice
The Institute’s survey follows a
critical report from Citizens Advice on customer service performance from
energy firms. Citizens Advice (which ranks suppliers using a star rating
system) said that standards had "plummeted" to a record low since
June 2021 when several suppliers went bust due to high global gas prices.
According to their research, the average waiting time on the phone to speak to
a firm was now about six-and-a-half minutes, compared with just under four
minutes the year before.
What do the experts say?
Jo Causon, Chief Executive of the
Institute of Customer Service said that customers did not want products and
services that were "just cheap". So therefore businesses need to be
flexible and transparent about what they are offering their customers. This
could include being upfront about products and when they would become available
if the supply was held up.
According to Causon: "Organisations
can’t avoid these issues. They will need to develop service strategies that are
responsive to evolving customer needs but also protect short and long-term
business performance.” She added that UK companies had got better at dealing
with, and resolving, complaints, but more work was required to prevent the
problems in the first place.
Darren Bugg, Editor of The Customer
Service Blog said: “This new research doesn’t surprise me at all. From my own
research, I’d suggest that the situation is actually even worse than suggested.
For example, the research by Citizens Advice suggests that customers have to
wait on average six-and-a-half minutes to speak to someone on the phone. But for
many customers, it often takes far longer to speak to someone in customer
services.”
“For example, only today I’ve had to
wait 45 minutes on hold to speak to someone at British Airways, and then
another 20 minutes on hold waiting to speak to someone at Northern Trains!
Waiting on hold for 30 minutes or more seems to be typical with many companies.”