What 1000 Consumers Say About Bad Customer Service

bad_customer_service

It’s very easy to underestimate the true cost of bad customer service. This is why we asked 1000 consumers if they would ever return to a company after a terrible service experience if recommended again by a peer.

CONTENTS

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Intro:

Word of mouth marketing

1:

The importance of getting it right first time

2:

Our experiment

3:

The results

4:

What this means for your business

5:

Is it too late to win the customer back?

6.

What you can do to rectify bad customer service

Takeaways

Intro:

Word of mouth marketing

Word of mouth marketing is one of the most valuable forms of marketing with 92% of consumers believing recommendations from friends and family over all forms of advertising.

We wanted to test word of mouth marketing to see if it could be used to rectify a customer’s bad experience. At Kayako, we help our customers get better at customer service.

We want to make sure our customers are offering excellent customer service so their customers continue to pay for their service or product.

We want to know whether there are ways to win back customers who have previously received bad customer service, if they’re recommended to the company by a trusted friend.

 

1: The importance of getting it right first time

Businesses of all sizes will, at some point, have to have to think about how they want to deliver their customer service.

Good customer service is powerful for any company. Through word of mouth, positive experiences resonate through people’s networks.
You can attract new customers while also retaining your current ones, making them more loyal.

Amazon's Jeff Bezos comments on bad customer service
Jeff Bezos (Founder, Amazon)

“We see our customers as invited guests to a party, and we are the hosts. It’s our job everyday to make every important aspect of customer experience a little bit better.”

Companies assume bad customer service is a cause of customer churn; and that word of mouth heavily influences consumer decision making. The statistics support this too:

59% of consumers like to tell others about new products.

When companies give bad customer service, it looks bad on the company and often causes customers to leave and take their business elsewhere.

 

2. Our experiment

Customer support teams strive for excellent service but what if they don’t deliver?

We wanted to know: could a poor customer service experience end a customer relationship forever? Could you win back a customer who had previously left due to poor customer service?

We also wanted to look at the importance of peer recommendations. Could a trusted friend’s recommendation be enough to convince a customer to return to a company they previously received bad customer service from?

We asked 1000 consumers the following question:

You’ve received bad customer service from a company in the past. How likely would you be to try them again if a trusted friend recommended them based on incredible service?

Positive word of mouth seems to mean very little once a customer has already had a bad experience

What we thought would happen

If customer service is good, customers are likely to come back.

But what if the service was bad?

What if service was bad, but your company was recommended by a trusted friend who told them the service was good – could peer recommendation bring customers back?

We assumed customers would be more likely to return on the back of advice from their trusted friend.

This assumption is based on the plethora of statistics supporting the idea that word of mouth marketing is a powerful asset and almost guaranteed to work.

People are much more likely to purchase a product when they learn about it from friends and family (77%)

81% of consumers’ buying decisions are influenced by their friends’ social media posts

With stats like those, we thought we would be proving our hypothesis. But the results told a very different story.

bad customer service report: customers are more like bomerangs than frisbees

3. The results

Almost 60% of consumers were unlikely or very unlikely to return to a business they had experienced poor customer service from, even if a trusted friend said the service had improved.

Only 12.5% of consumers said they would be likely or very likely to try a company again.

It seems customers don’t let their friends’ opinions affect their choices to buy.

Positive word of mouth seems to mean very little once a customer has already had a bad experience.

You’ve received bad customer service from a company in the past. How likely would you be to try them again if a trusted friend recommended them based on incredible service?

what Kayako data reveals about bad customer serviceHowever, age did have an effect on whether people would be more likely to return to a company: millennials are less skeptical and more willing to consider the opinions of their peers.

This is due to the “social media” effect, where they are more likely to ask their friends’ opinions.

70% of millennials are much more likely to base a product purchase on their friends’ opinion.

Age affected how high people answered on the scale.

Kayako's bad customer service research

4: What this means for your business

Customers are staying loyal to their disloyalty; there is little to no room for error. Businesses need to get customer support right the first time as there are often no second chances.

With more and more options available, your customer doesn’t want to (and doesn’t have to) put up with poor customer service. For every company that fails to provide excellent customer service, there’s another company that will.

Our survey found not even peer recommendation can win back a lost customer. One mistake and you can lose a customer for life.

It’s much harder than we thought to get customers back once they’ve gone. It’s important to put effort into preventing customers from needing to contact customer service.

You should always try to provide great customer service when something does go wrong and make up for it when you get something wrong.

 

5: Is it too late to win the customer back?

No company is perfect – you will lose customers, and sometimes it will be because of bad customer service experiences. But is there anything you can do to get them back once they’ve gone?

Our survey results show you can’t rely on peer recommendations bringing your customers back (though that doesn’t mean you shouldn’t keep working hard to satisfy your existing customers!). Instead, focus on making a proactive effort to resolve customer issues before they arise.

Know how to really say “I’m sorry”.

When JetBlue passengers were stranded on the runway for 11 hours without food or water, the founder and CEO of the airline, David Neeleman, described how he felt about the incident as “humiliated and mortified.”

Neeleman was both authentic and transparent with his apology. He demonstrated the humility to admit mistakes quickly without spin and without making excuses. He reacted by showing he genuinely cared about his customers.

After humbly apologizing after the incident, Neeleman provided refunds to the stranded customers, which was a huge financial risk to the company. JetBlue is an airline that wants to be known for great customer service, and Neeleman knew refunding customers is standard protocol for any company when they’ve given a bad service experience. So, JetBlue went further.

Neeleman next created a Customer Bill of Rights that penalizes JetBlue financially and rewards customers for every hour they spend stranded on a plane. This innovative bill of rights, however, protects JetBlue customers and may force the airline industry to face it’s bad customer service record, squarely putting JetBlue at the top for proactive customer service.

JetBlue customer bill of rights is part of their customer experience strategy to prevent bad customer service in the future

How Npshire priotoizes customer satisfaction to avoid bad customer service
Rasheen Carbin (CMO, Nsphire)

Nsphire follows a system of transparency and Rasheen personally follows up any customer requests in order to encourage disheartened customers to return, demonstrating Nsphire takes customer satisfaction seriously.

Curtis Boyd comments on how he deals and avoids bad customers service
Curtis Boyd CEO, Future Solutions Media

Curtis believes it’s important to give customers confidence in your company. Bad reviews matter regardless of what kind of bad review, the most important thing to remember is that these reviews decrease confidence in your company from potential customers.

 

6: What you can do to rectify bad customer service

It’s impossible to please all your customers all the time. It’s important to make sure you know what to do when something goes wrong, so you can solve the issue and try to win back your customer before they leave.

1. Accept blame and apologize

Your customers stopped using your service for a reason. They felt the service or support they received was not good enough. If you want a chance to win them back, you need to accept blame, be humble and find out exactly where you went wrong and what you could do to improve. The important bit? Ensuring their advice is taken on board!

2. Give your customers something to come back for

If you’re going to contact a customer and encourage them to come back, there needs to be something in it for them.

They don’t want to risk wasting their time, and you don’t want to waste your efforts.

Whether they left because of a problem with your product, or your service, make sure the issue is fixed before enticing them back.

3. Build lasting relationships

Your customers are people, and people have needs. Give each customer personal and special attention to make up for any poor service they had previously encountered. A personal touch can go a long way to help build new, long-lasting relationships.

4. Make your offering better than your competition’s

If you’ve lost customers due to poor customer support, it’s likely they have moved to one of your competitors. If you’re going to attempt winning them back, ensure your offering is better than that of your competitors’, or customers will have no real reason to return. Learn from the best support pros about building customer relationships

5. Consider how you’re handling complaints

If you’re faced with a complaining customer, the first thing you need to do is rectify the situation. If it’s not already obvious, try asking “what can we do to make it better?” and listen to their feedback.

Customers are not always going to be happy with the support they receive, but dealing with their complaints in a positive, timely way can go some way to encouraging them to continue to do business with you.

 

TAKEAWAYS

Kayako's final takeaway on bad customer services true effects

We assumed word of mouth marketing would be powerful enough to convince customers to return to a company they previously received bad service from. However, the results from our survey showed 60% of people are unlikely to do this.

People remember their customer experiences, especially bad ones, and a friend’s good word doesn’t have an effect on their buying choices.

It’s much harder to gain customers trust back once they’re gone. Word of mouth marketing is only effective if the customer is considering the business for the first time. It’s unlikely to be effective if the customer has already experienced bad customer service from a business.

It’s crucial when dealing with customers that you make a conscious effort to prevent your customers from needing

to contact your customer support team.

Primarily, you should always aim to provide excellent customer service. But you also need to make sure you have defined methods in place for when things go wrong.

Customer behavior more closely resembles a frisbee than a boomerang, once you upset your customers, they’re unlikely to come back

 

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About the author
Adam Rogers

Adam Rogers is the Content Marketing Manager at Kayako, the effortless customer service software that helps teams be more productive and build customer loyalty. Adam loves guitars, music, books, and his wife Lacey.

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