Businesses Failing To Admit Their Customer Service Shortcomings, Says Study

Businesses are out of touch with their customers and yet overestimate the quality of the customer service they provide, according to new research from Pegasystems Inc.

The 2019 global customer service insights’ study conducted across the globe by research firm Savanta, surveyed a total of 12,500 customers, businesses executives, and customer-facing employees, reveals that many businesses don’t even know their customers well enough to be able to provide the level of service required.

The study also found that many organizations aren’t fully committed to providing the level of service they aspire to. As a result, the run the risk of losing customers to competitors as a result.

Key findings of the study include:

• Business decision makers are out of touch
  

  71% of business leaders think they provide better customer service than their competitors. The number is mathematically impossible to achieve, researchers believe. Four times the number of business leaders (40%) as customers (10%) rate the current standard of customer service provided as ‘excellent’. However, only 23% of customer-facing staff rate their organization’s services in the same way.

  An overwhelming 89% of decision makers feel that their organization provides an overall positive level of customer service, compared to 73% of employees. Only 54% of customers feel the same way.

• Are businesses really committed to providing good customer service?
  

  While 81% of business decision makers consider customer service as either their main or key competitive differentiator, 33% of customer facing employees say they face no consequences for providing bad customer service. Meanwhile, 48% of customer-facing employees say they experience barriers to providing good service.

• Poor service is driving customers potty
  

  88% of customer-facing employees say that customer service is a priority within their business, but the customers themselves are telling a different story. Only 11% of consumers say that they find contacting customer services to be an enjoyable experience. Of those who expressed dissatisfaction, 63% say that they would rather clean the toilet than have to contact a customer service team. Only 10% say that their typical customer service experience is ‘excellent’.

• Customers feel like organizations don’t know them well enough
  

  Despite the fact that 87% of business decision makers believe they know their customers well, the vast majority of consumers feel differently. Just 23% of consumers say businesses understand them as a person and their customer service preferences ‘extremely well’, while 63% say that organizations should make getting to know them better their top priority.

• Poor customer service can lose you customers
  

  77% of customers agree that the standard of customer service they receive is a major determining factor in their loyalty, with 89% saying that receiving poor customer service from a business damages their impression of the brand. Significantly, 75% also say they have previously stopped doing business with an organization because of poor customer service, with 44% reporting that if they receive a negative customer service experience, they immediately stop the purchase and move to another vendor. Despite this, only 35% of business decision makers say they lose customers ‘all the time’ or ‘fairly regularly’ as a result of providing poor customer service.

• There are a number of areas for improvement
  

  Customers highlighted a number of specific areas of frustration within customer service for businesses to improve on. Their top three frustrations include taking too long to receive service (82%), having to repeat themselves when switching between channels or agents (76%), and not knowing the status of the query (64%). When asked what made for a positive customer service experience, 59% agreed that a quick resolution of their issue or question mattered most, followed by a need for knowledgeable service agents (48%).

“Good customer service can be the difference between success and failure, and what this study tells us is that organizations still have a long way to go before they are able to meet the expectations of their customers,” said Suman Reddy, Managing Director, Pegasystems India.

“The real question is, how willing are key decision makers within organizations to make the transformation required to turn things around? Bad customer service has long been a thorn in the side of consumers, and it’s now more important than ever that business leaders and employees collaborate closely and start facing up to the potentially ugly facts of the quality of the service they are providing, before it’s too late,” summed up Reddy.