Random musings: Poor Customer Service Costs US Businesses $75 billion

Today's blog post is based on a Facebook post by my friend Kimmer Sue, which in turn was based on an article in Toister Performance Solutions, Inc.:

Broken promises. Defective products. Surly employees. The list of poor experiences we face as customers goes on.

A report from NewVoiceMedia estimates those service failures are costing companies in the United States $75 billion per year.

The company worked with research firm Opinion Matters to survey 2,002 consumers. Its objective was to learn what people do when they experience poor service and why. The results should be a wake-up call for businesses:

67 percent have left a company due to poor service

10 percent have switched 5 or more times in the past year

$430 is the average a business loses per lost customer

Losing a customer isn't the only consequence of poor service. A separate study revealed many other ways angry customers can hurt a company.

What can you do to improve your customer service? First - focus on emotions:

Customer service is about emotions. Yes, customers have rational needs like getting the candy bar they purchased or solving a billing issue. However, it's the emotions behind these experiences that will cause a customer to be loyal or jump ship.

NewVoiceMedia's report discovered that 86 percent of customers are likely to do business with a company again if they make a positive emotional connection with the person serving them. It could be a moment of friendly banter or an empathetic gesture to solve an issue.

Sadly, customers say that emotional connection happens just 30 percent of the time.

Also, you can make service easy:

The phone is still king when it comes to customers' preferred channel for solving issues quickly, with 48 percent indicating it is their top choice.

That doesn't mean everything is perfect. Customers often find calling companies to be exceptionally frustrating. Here are the biggest challenges cited in the NewVoiceMedia report:

Talking to multiple agents.

Not being able to talk to a real person right away.

Being kept on hold.

My own study of customer complaints on Twitter shows that 80 percent of complaints are an escalation. This means that customers tried to call, email, or contact the company via a different channel and were unable to get their issue resolved.

Companies make service too difficult.

Remember, please and thank you still go a long way in any kind of interaction, whether personal or business. And as I talked about earlier this week, only 3% of businesses say thank you to their customers!