Friday, 14 November 2008 19:00

RightNow Survey: Good Customer Experiences Key Differentiator for Companies as Consumers Cut Spend

In an economic downturn, more than a quarter of Australians are most likely to remain loyal to companies that provide them with the best service. So says a new study investigating what impact the current economic situation will have on consumer spending and customer service in the run-up to Christmas.  
The survey, conducted by StollzNow Research and commissioned by RightNow® Technologies (NASDAQ: RNOW), polled 500 Australian adults and found that:

·     47% of all respondents had suffered a negative customer experience in the last six months
·     79% of consumers have stopped doing business with an organisation because of a bad experience
·     71% tell others about their negative customer experiences with the main aim (69%) being to prevent other consumers doing business with the company at fault

Even at the best of times these statistics are likely to have a significant impact an organisation’s bottom line in terms of lost business. However, the financial ramifications are potentially exacerbated when considered against the backdrop of consumer spending trends also revealed by the study. Asked about their online, retail and Christmas spending plans, Australian indicated that, in light of the global economic situation:

·      35% of them have already decreased both online and retail spending
·      In the next six months 35% are likely to decrease spending in retailers and 29% will decrease online spending
·      36% will buy the same number of Christmas presents as last year but at a lower spend per person, 27% will try to buy fewer presents

With consumers reigning in their spending, good customer service as a competitive differentiator becomes increasingly important for businesses if they are to weather the economic turmoil. The provision of ‘outstanding service’ remains the number one reason why Australians recommend companies to others and, even in an economic downturn, 28% of consumers will remain loyal to companies that provide them with the best service.

The survey also found that the Federal Government’s ‘Economic Security Strategy’ whereby families, pensioners and carers will receive one-off payments, may not help stimulate the economy; when asked what they would do with $1,000 if they were given it tomorrow – 61% of Australian’s would save it, only 17% would spend it.

Commenting on the survey’s findings, Brett Waters, RightNow’s vice president, Asia Pacific-South, said: “There are tough times ahead for both companies and consumers. Consumers are concerned that the dollar in their pocket isn’t going as far as it used to, so they are more selective about whom they spend with and focusing on finding better deals. What companies need to remember is that while competitive prices may seem like the short-term fix to satisfying customers, longer term, customer care strategies, which focus on delivering good customer experiences, will ensure customers remain loyal through rough trading environments and beyond.”

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