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Report: $83 billion lost because of bad customer service
The customer is always right. It's an age-old saying that retailers live by. But, according to a recent report customer service, specifically bad customer service, is costing businesses billions of dollars each year. Analysts from Greenfield Online, Datamonitor/Ovum and Genesys found that more than $80 billion is lost each year because of bad customer experiences.
Not only is bad customer service costing money on singular purchases, it is funneling into a non-shopping pattern. The researchers found that two-thirds of consumers have 'ended a relationship' with a retailer because of one bad experience and 61% have taken their business to competing brands.
The problem is even bigger on a global scale. The report indicates that more than $300 billion is lost each year around the world because of bad customer service with $243 billion then being spent with competing entities.
Who is being the hardest hit because of bad customer service?
• Cable/Satellite companies lost about $12 billion in 2009
• Financial services lost more than $10 billion
• Utilities companies lost nearly $2 billion
Although the money lost is a huge issue, the biggest problem is that consumers are leaving the companies because of a customer service experience and jumping ship to competitor properties. This means not only a loss when the initial experience happens but continued losses because these consumers will not return for future interactions. On average consumers are flipping companies twice per year.
What are consumers most upset about?
• Automated self-service
• Prolonged waits for help/service
• The need to repeat their issue
• Inability to switch communication channels
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