Industry Research : Businesses Losing Money Due to High Failure Rate of Customer Programmes
8 in 10 companies with solid customer programmes demonstrate significant profit increases. Yet 81% of organisations have seen their customer initiatives fail in the last three years, costing them up to £750,000 each over the past three years
?Europe lags behind the rest of the world in meeting customer expectationsFewer than 20% of companies globally are delivering the level of service their customers expect, according to a new study from Avaya, a global provider of business collaboration and communications solutions and services.
The research suggests that European companies lag behind their Asian and American counterparts when it comes to closing the gap between customer expectations and the service they deliver and are missing out on potential profit increases as a result.
Despite the research finding a firm correlation between customer service initiatives and increased profits, businesses are failing to evolve their customer programmes fast enough to keep consumers satisfied.
- 81% of companies with solid customer initiatives in place have seen significant profit increases in the last 12 months.?92% of UK/ 61% of German consumers would rather spend money with organisations that are easier to buy from?Yet less than a fifth (16%) of British/ German managers believe customer effort significantly impacts spending satisfaction and retention and less than half (40% UK)/ less than a third (30% Germany) have initiatives in place to reduce customer effort
- ?When businesses do listen they are still getting it wrong
Eight in ten organisations have put in place projects aimed at improving customer service in the last year, ?but 81% of organisations have seen their customer initiatives fail in the last three years. ?Consequently, 66% say they have wasted money on failed customer initiatives – as much as £750,000 per organisation - and many senior managers are unable to even quantify how much money has been wasted?In addition to losing money these failed customer initiatives mean businesses miss out on the increased customer satisfaction (68%), loyalty (64%), retention (59%) and repeat purchasing (56%) that companies with solid customer experience programmes report
?Europe lags behind the rest of the world.
?In general European businesses place less importance on managing the customer experience. In China and the US 83% and 73% of businesses respectively have a customer management programme in place while in India the figure is 72%. This is in sharp contrast to Europe, where only 55% of British and German companies do. In India three-quarters of business managers say customer experience management is very important. The US (59%) and Brazil (59%) also view it as very important, but fewer business managers in Germany (33%) and the UK (39%) feel this way.
Getting off the ground
?The research reports that 31% of organisations who do not have a customer management programme in place attribute its absence to a lack of appropriate technology. A further 37% say they are being held back by the fact that different parts of the business own the customer experience. Avaya’s Enhanced Customer Experience Management Portfolio provides solutions that help companies deliver transformative customer experiences, truly moving customer experiences into the next generation – with better services, advanced technology and ultimately great solutions for today’s consumer.
?"Lacklustre customer service is inexcusable in a digital world where customers are king," says Garry Veale, president of Avaya in EU. "When it is so closely linked with customer loyalty and increased profits, and with cost-effective and easy-to-implement software and services available to companies of all sizes, there really is no excuse for not having a comprehensive programme in place."
Additional Resources: ?Avaya CEM Research Infographic on Slideshare?Avaya CEM Research Media Summary Report
Survey Methodology: ?The survey was conducted globally across 13 countries by independent market research firm Dynamic Markets on behalf of Avaya including: United States, Canada, Mexico, Brazil, United Kingdom, Germany, Netherlands, Russia, China, Singapore, Japan, India and Australia. 1,268 businesses with more than 1,500 employees were interviewed, 54%of who are at senior-management level or above. 8,500 adult consumers were surveyed; 49%of who are male and 51% female.
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Published: Wednesday, May 14, 2014