Despite having more data and insights into consumer desires and preferences, companies in the U.S. have failed to meaningfully improve customer satisfaction or reverse rising switching rates among their customers. As a result, there is a potential $1.3 trillion of revenue at play in the U.S. market represented by the ‘switching economy,’ according to new research released by Accenture.
The research revealed that 51% of U.S. consumers switched service providers in the past year due to poor customer service experiences, up 5% from 2012. Switching rates were highest among retailers, cable and satellite providers and retail banks, making companies in these sectors the most vulnerable, but also giving them potentially the most to gain.
The survey found that customers are increasingly frustrated with the level of services they experience: 91% of respondents are frustrated that they have to contact a company multiple times for the same reason; 90% by being put on hold for a long time; and 89% by having to repeat their issue to multiple representatives. There are also frustrations with marketing and sales practices: 85% of customers are frustrated by dealing with a company that does not make it easy to do business with them; 84% by companies promising one thing, but delivering another; and 58% are frustrated with inconsistent experiences from channel to channel.
Other findings include:
- Overall customer satisfaction fell by 1% since 2012, while customer loyalty rose 1% and willingness to recommend a company rose 2%.
- 81% of customers who switched providers in the past year said the company could have done something differently to prevent them from switching, with customer service equally important as price.
- 48% of U.S. customers use third-party online sources, such as official review sites, and 25% use customer reviews and comments from social media sites, to find out information about a company’s products and services.
- 71% of customers use word-of-mouth.
- 75% of respondents now use one or more online channels when researching companies’ products and services and 33% use mobile devices to access these online channels.
- 82% of customers say they feel companies they buy from cannot be trusted on how they use personal information provided to them.
“Changing customer behaviors in the digital marketplace and low levels of customer satisfaction are fueling a switching economy that presents opportunities as well as threats. But too many companies are playing not to lose instead of playing to win in this switching economy,” said Robert Wollan, global managing director, Accenture Sales & Customer Services. “Growth is harder to come by in many sectors but the switching economy presents a source of new, sustainable, profitable growth for companies that are playing to win and gain market share. To win requires an aggressive approach that goes beyond implementing technology to creating genuinely engaging customer experiences that today’s nonstop customers are seeking but obviously not finding with their current providers.”