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December 14, 2012

Consumers 'will pay more for better customer service'

Shoppers are willing to spend significantly more with businesses that offer a great customer experience. But in the new world of multi-channel marketing, the very definition of service is changing.

These are the findings of two new reports that demonstrate the impact that customer service has on the bottom line.

A report from Oracle, Why Customer Satisfaction is No Longer Good Enough, has revealed that 81% of consumers are willing to pay more for superior customer experience. And almost half (44%) would pay a premium of more than 5%.

Improvement of the overall customer experience (40%) and providing quick access to information and making it easier for customers to ask questions (35%) were cited as key drivers for spending more with a brand.

Other findings included:

  • 70% of respondents had stopped doing business with a brand following a poor experience
  • 92% of these had gone straight to a competing brand and made a purchase
  • 82% of respondents describe their experiences as requiring too much effort, suggesting that brand loyalty is closely linked to ease of communication

Meanwhile, new research conducted by YourSayPays on behalf of consumer experience company [24]7 reveals that 51% of consumers feel frustrated when companies do not know who they are or what their issue is, despite having interacted with that company via another channel previously.

"Consumers are now saying 'enough is enough' and are willing to change providers if a service doesn't meet their expectations," said Mike Hughes, European MD of [24]7. "The world has changed for customers and they demand that companies know who they are, what they want, and how they want to be served. Customer service and the multi-channel experience are essential.

"Bad service is costing firms customers and cash, and organisations need to better understand what constitutes good customer service."