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New study: poor service is eroding loyalty to retail brands

A new study has found that poor service is eroding consumer loyalty and confidence in retail brands.

GENERAL MERCHANDISE

New study: poor service is eroding loyalty to retail brands

A new study has found that poor service is eroding consumer loyalty and confidence in retail brands.

A poll of 2,000 consumers commissioned by customer service specialist KANA Software found that 30% of those surveyed had become less loyal to retail brands in the past five years. In addition, a quarter of those customers identified poor service as the main reason for their declining loyalty.

The research shows that a major concern for shoppers was the number of times they had to repeat their complaint to different people within the same company. Almost half of respondents - 48% - said they had to repeat information during their last communication with a retailer.

While all age groups identified repetition as a problem, it occurred most frequently for customers under the age of 35 with one in 20 having to repeat themselves at least five times. Only 30% of these younger customers had their issue resolved after one interaction. By contrast, 64% of customers over the age of 65 did not have to repeat their complaint at all and felt satisfied after their first contact.

Of those shoppers who felt less loyal to retail brands, 37% of 18 to 24-year-olds cited service as the key factor versus just 20% of those aged 65 and older.

Steven Thurlow, head of worldwide product strategy for KANA, said: “The need for repetition shows not only poor management of customer data, channels and context, but more fundamentally a lack of ownership of the consumer’s problem and lack of appreciation for their effort levels.

"The younger generation has higher expectations of digital channels, collaborative and social communications and asks ‘how hard can it be.’ They won’t take seriously an organisation that is unable to do the basics right, and these expectations are rising all the time." 

The study also found that more than one in 10 adults polled said they had used at least five different customer channels to contact a retailer in the last six months. KANA said this finding supports other studies it has conducted which show that UK consumers regularly use multiple different channels of contact. Web-based chat, email and face-to-face in store came out as the most popular choices for customer engagement with the preference varying between age groups.

Thurlow added: “When you have an issue, you want to speak to someone who knows your back history and is able to take action on your behalf. Repetition causes frustration and makes customers feel devalued or, worse, completely ignored. Without a true sense that different channels of communication are linked, people feel that they are wasting their time and, ultimately, this leads to an erosion of loyalty in the retail brand.”

 

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