A quarter of South African customers would ditch companies after just one poor experience, while 63% of them would switch to competing brands after just two-to-five bad examples of customer service.
This is according to new research by analytics firm SAS which says that, despite disruption caused by Covid-19, customers’ patience with companies offering a poor customer experience is running thin.
Businesses looking to avoid this pitfall can no longer rely solely on price, according to respondents. The research found that, when deciding who they will spend their money with, customers are placing increasing importance on the experience and service provided by brands.
Nearly 87% of South African respondents said they would pay more to buy and/or use products and services from businesses that provided them with a good customer experience during Covid-19.
This coincides with a drop in the importance of price. Before the pandemic just over half (51%) of customers put it in their Top 3 factors for a good customer experience. Now, it is in under half (48%) of customers’ Top 3 – a decrease of 3% in a short period of time.
The challenge intensifies further for businesses as the research found that what customers consider to be a “good” customer experience can encompass everything and anything from price to convenience.
When respondents were asked to rank their Top 3 customer experience concerns, the responses led to the following findings:
• About 18% valued flexible returns and refunds as a key concern;
• A third (32%) cared about responsive customer support;
• A third (32%) felt it was essential for companies to behave responsibly;
• Meanwhile, two-fifths (40%) placed great value in convenience
Findings from last year’s Experience 2030 report showed that companies were out of sync with customer demands. For example, more than half of companies selected high quality products/services as the most important factor (58%), which was true for just a third (35%) of customers.
Akesh Lalla, Country Manager at SAS, says: “Companies across Europe, the Middle East and Africa (EMEA) may feel that they’ve braved the worst of the storm with disruptions on a downward trend. However, having broken through the initial storm cloud, they now face a new challenge: increasingly demanding and unpredictable expectations when it comes to customer experience. If they don’t adapt quickly by using AI and analytics to offer a more personalised and realtime customer experience, customers will leave in droves. During a time of recession, this simply isn’t an option.”
The research also found that there have been signs of improvement over the last few months, despite the disruption caused by Covid-19. An average of three in 10 customers noted an improvement in the customer experience during lockdown. Further, the good news for businesses is that more than one in 10 (15%) of customers started using a digital service/app for the first time since lockdown, with over two-thirds (70%) planning to continue using it after lockdown. This represents a significant new pool of digital customers for businesses to interact with, but it’s important they have the capability to analyse this new online data to drive superior marketing analytics and customer experience.
However, despite these improvements and new opportunities, customers still think there is much more that businesses can do. An average of 13% of customers still felt that the customer experience had diminished over lockdown. This still leaves the majority of customers undecided on their feelings towards the customer experience: an opportunity for businesses to better understand their behaviours and preferences by using analytics, providing them with a competitive advantage.