Saturday, December 13, 2008

Service Counts More than Price

It appears that Accenture has surveyed more than 4,100 consumers in various countries (countries other than the US are not identified). The survey was conducted over the summer of 2008 when the signs of the current financial crisis were emerging. Their key finding during this market turmoil is that consumers found service, more than price, to be a clear differentiator.

According to their survey results 67% of the respondents reported that they switched companies because of poor customer service. In the US the percentage is even higher
(73%). The percentage of customers who switched because of lower prices was 47%. Accenture has been performing this same survey for four years and the survey results show the increasing impact of service. The first survey reported 48% of the respondents said they were switching because of customer service. In four years the percentage has increased 19% (about 5% per year).

There were four other interesting findings; namely,
1. US consumers are the least likely to believe that technology has significantly increased customer service in the past five years.
2. When choosing a new provider, US customers weighed price and customer service equally.
3. The most important aspect of customer service identified by consumers was employees who are knowledgeable and well informed.
4. Consumers estimated they BROUGHT $4,000 WORTH OF BUSINESS to their new provider.

The bottom line is that survey after survey seems to be repeating the same message, customer service is a vital strategic weapon for companies. Unfortunately most companies haven't figured out how to use the weapon.

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