The cost of poor customer service: the numbers don’t lie

We have all received bad customer service from an organisation at some point in our lives. With more customers than ever willing to take action against poor service providers, the cost of a poor customer experience is higher than ever for businesses.827556_46291532

According to American Express, 78% of customers have cancelled an intended purchase because they experienced bad customer service. Gaining new customers is considered five times more expensive than retaining current ones, and between 60%-70% current customers will make a repeat purchase.

When someone has shown the desire to purchase from you, the last thing you want to happen is for them to choose to abandon that purchase due to a bad customer experience. Service quality should by high before, during and after a purchase, and firms should make the buying process as smooth, easy and enjoyable as possible.

What makes matters worse is that only 4% of unhappy customers will ever tell you that they aren’t satisfied, and even more worryingly, 91% of unhappy customers will never return to your business.

This brings a new dynamic to analysing customer satisfaction. A company may provide very poor customer service but receive very few complaints. Signs of poor customer service are no longer in the customer satisfaction survey, but in your customer retention rates, and to make matters worse, customers will tell twice as many people about a bad experience then they will about a good experience.

Bad customer service is proving more costly than ever and the damage isn’t limited to simply losing the customer who had that bad experience. Things will inevitably go wrong occasionally in a customer service environment, but it is companies that make the extra effort to rescue and resolve those problems that are really winning.

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