Survey: Poor service undermines loyalty programs

New York City -- A survey released Tuesday by Accenture showed that when it comes to customer loyalty, poor service can cause customers to abandon one company in favor of another.



The Accenture Global Consumer Survey found that 66% of consumers switched companies – including wireless phone, cable and utilities – as a result of poor customer service in 2011, even as their satisfaction with the services provided by those companies rose overall.



The survey asked consumers in 27 countries to evaluate 10 industries on issues ranging from service expectations and purchasing intentions to loyalty, satisfaction and switching.



Among the 10,000 consumers who responded, the proportion of those who switched companies for any reason between 2010 and 2011 rose in eight of the 10 industries included in the survey. Wireless phone, cable and gas/electric utilities providers each experienced the greatest increase in consumer switching – five percentage points. This includes consumers who switched entirely to another provider as well as those who continued to do business with their current provider but added services from another provider – a new, but growing trend.



According to the survey, customer switching also increased by 4% in 2011 in the wireless phone and Internet service sectors.



The survey also found that fewer than one-quarter (23%) of consumers surveyed feel “very loyal” to his or her providers, while 24% indicated that they had no loyalty at all. And, just 49% indicated that they are strongly influenced by at least one loyalty program offered by their service providers.



At the same time, however, consumer satisfaction with their providers’ customer service actually increased in 2011 in 10 attributes measured by the survey. These attributes include the wait time for service (33% satisfied compared to 27% in 2010), the ability to resolve issues without speaking with an agent (38% satisfied compared to 33% in 2010) and speaking with just one customer service agent to resolve an issue (39% satisfied compared to 32% in 2010).



“Companies are improving many of the most frustrating parts of the customer service experience, but they are facing a customer who is increasingly willing to engage multiple providers for a service and is apt to switch quickly,” said Robert Wollan, global managing director, Accenture Customer Relationship Management. “While high-quality sales and service in areas such as product knowledge and efficient issue resolution remain a basic requirement, in order to achieve sustainable, profitable growth, companies must better understand what really keeps their customers engaged.”