Benefits of Delivering Good Customer Service
Companies that prioritize customer service tend to perform better.
Let's take a look at some real numbers that show just how much of a difference good customer service can make:
Most importantly, customer service has a good impact on boosting your ROI:
- When customer service is perceived as a “value center”, a business's income grows more (5.8%) than when they think it's just a “cost center.” (1.6%). (Accenture)
- Almost 40% of customer service leaders say that their company views customer service as an expense rather than a driver for growth. (Hubspot)
- 72% of shoppers are willing to pay more for a brand that offers an exceptional customer experience. (Gladly)
- 36% of business leaders are seeing direct revenue generation with support automation. (Ultimate)
- Providing excellent customer service and improving the customer experience can increase sales revenue by 2-7% and profitability by 1-2%. (McKinsey & Company)
- 48% of customers have switched brands for better customer service. (Salesforce)
- 94% say good customer service makes them more likely to make another purchase. (Salesforce)
Furthermore, delivering good customer service improves your business communication.
- One out of every five companies sees their customer service as a key part of their business that helps them build strong relationships with customers and grow over time. (Accenture)
- After receiving excellent customer service, 75% of customers forgave a company's mistakes. (Salesforce)
- 32% of respondents said yes when asked if they’d “fall in love with a brand because of great service. (Gladly)
What's more, the impact of good customer service goes beyond immediate financial gains, increasing customer loyalty and even supporting your worth of mouth marketing efforts:
- 59 % of consumers would recommend a brand to a friend because of its customer service. (Gladly)
- 83% of customers feel more loyal to brands that respond to and resolve their complaints. (Khoros)
The Negative Consequences of Poor Customer Service
It's pretty clear: how a company treats its customers can make or break its relationship with them.
We've got some numbers that show what happens when companies don't get it right, and believe me, the effects can be long-lasting.
Verint asked customers: Have you ever stopped doing business with a company because of a bad customer experience?
- With 69% of consumers stopping doing business with a company after a poor customer experience.
Have you ever thought about which cases this 69% rate as a bad experience? Verint's statistics reveal this:
- 25% of people find it most frustrating to make multiple attempts to get a simple answer to their question.
- 24% of customers feel most frustrated by waiting on hold to speak to a customer service representative.
- 25% of customers are most frustrated when they can't contact the company on their preferred email or social media channel.
- 17% find it most frustrating when a bot does not understand them, leading to responses like "Sorry, I don’t understand".
- Only 8% feel most frustrated by inconsistency in the information or service provided when contacting a company through different channels.
It is clear which areas you should focus on and develop in the customer service you offer / will offer above.
Furthermore, Verint's statistics make it very clear what your consumers' behavior will be until you address their shortcomings:
- 42% of people are extremely likely to ignore or unsubscribe from emails from a company after a bad digital customer experience.
- 33% are extremely likely to switch to one of the company's competitors.
- 35% are extremely likely to tell friends or family members not to purchase from that company.
- 33% are extremely likely to unfollow or stop reading the company’s social media posts and other content.
- 21% are extremely likely to write a negative review of the company.
- 19% are extremely likely to share their bad experience on social media platforms like Twitter or Facebook.
Here are some additional service statistics that highlight how serious the consequences of poor customer service can be:
- 42% of customers said they would stop buying from a brand altogether after just two bad service experiences. (Gladly)
- 60% of customers say it generally feels like they’re communicating with separate departments, not one company, and 66% often have to repeat or re-explain information to different representatives. (Verint)
- 69 % of consumers have stopped doing business with a company due to a single poor customer experience. (Verint)
- 1 in 5 (19%) consumers consider not getting the issue resolved during the first interaction to be the most frustrating thing about customer service. (Netomi)
Customer Expectations from Customer Services
Customer expectations are increasing year by year, and it is becoming increasingly difficult to meet these expectations. First of all, let's take a look at the rates of customer expectations in the past years:
The bar graph shows us a year-over-year increase in customer expectations as perceived by support teams, rising from 75% in 2022 to 83% in 2023 and reaching 87% in 2024, according to Intercom.
Well, as expectations increase, it becomes more difficult to meet expectations:
- 68% of C-level support execs say retaining customers now is harder than a year ago. (Intercom)
- And 43% of support teams believe this is due to higher expectations of great customer service. (Intercom)
Regarding customer service, people expect more than help with their questions or concerns.
To fully understand your customer's expectations, it is wise first to examine the reasons why they use customer service:
- 13% of customers contact customer service to report an issue.
- An equal percentage, 13%, reach out when they require information about a product or service.
- Payment information prompts 12% of customers to get in touch with customer service.
- Issues related to orders or deliveries also account for 12% of customer service interactions.
- Finally, 10% of customers contact customer service to complaints.
Deloitte's research sheds light on why customers reach out to customer service. Surveys reveal that customers mainly get in touch when they encounter an issue or need information about a product or service.
This highlights the significance of offering customers user-friendly tools, like self-service options, to efficiently address their questions and concerns.
Now, let's delve into what exactly customers expect and care about in these interactions according to Deloitte's research.
- A significant 45% of customers prioritize solving their issue on the first contact with customer service.
- 25% of customers consider the time it takes to resolve their issue as important.
- Personalized service from agents is crucial for 22% of customers.
- A smaller segment, 8%, values the ability to solve problems end-to-end through self-service options.
Many other cases that customers care about when communicating with customer services have been found as a result of different research:
- 68% of those who ask customer service questions about products expect the representative to have sufficient product knowledge. (Gladly)
- 66% of respondents said they’d prefer brands that know them and can recommend things they would like. (Gladly)
- Only 27% of survey respondents provided information about situations where they engaged in small talk and where customer service representatives helped them. 73% find small talk worthless in such cases and prefer to focus on the problem. (Netomi)
- 76% of shoppers asked customer service representatives questions about products. (Gladly)
- 83% of consumers want to immediately connect with a sales rep or support agent upon contacting the company. (Hubspot)
- 86% of responding consumers stated that it’s important or very important to them that they can contact a real person when communicating with a business. (Statista)
- 83% of customers expect to interact with someone immediately upon contact, and 83% expect to resolve complex problems through one person. (Salesforce)
- 73% of customers expect companies to understand their unique needs and expectations, yet 56% say most companies treat them like numbers. (Salesforce)
- A whopping 87% of support teams say customer service expectations have increased in the past year. (Salesforce)
Now let's take a look at the other side of the coin; here are the statistics on the areas where support teams are experiencing the greatest growth in customer expectations:
The Usage of AI in Customer Service
It is important to highlight that while AI can significantly improve customer service capabilities, it is not a total replacement for human interaction.
Many customers still value the personal touch and empathy only humans can deliver, particularly for difficult or sensitive matters.
Adobe asked surveyed customers whether they would prefer to interact with humans or AI, and the answer is not surprising:
- 50% of customers prefer human interaction, yet a significant 31% would want both options. (Adobe)
Deloitte highlights the positive or negative changes in customer service metrics using AI in customer service with statistics; let’s have a look at them:
Positive Impact of AI on Customer Service:
🟢 Faster Problem-Solving: 68% of people said AI helped solve customer service issues quicker.
🟢 Lower Costs: 65% noticed that AI helped save money in customer service.
🟢 Happier Workers: Another 65% felt AI satisfied employees with their work.
🟢 Better Customer Satisfaction: 63% said AI boosted customers' happiness with the service.
🟢 Fewer Cases to Handle: 56% reported that AI helped reduce the volume of support ticket.
No or Negative Impact of AI on Customer Service:
🔴 No Help in Avoiding Issues: 44% felt AI didn't help deflect cases or prevent issues from reaching customer service.
🔴 Customer Satisfaction Not Improved: 37% didn't see any improvement in customer happiness because of AI.
🔴 No Cost Savings: 35% noticed no cost savings from using AI.
🔴 Employee Satisfaction Unchanged: 35% didn't feel AI affected employees' happiness.
🔴 Not Faster at Solving Problems: 32% thought that AI didn't help speed up resolving customer issues.
When discussing statistics on using artificial intelligence in customer service, it would be impossible not to mention chatbots:
Verint's research results showed the reasons why chatbots lead to a bad experience:
- 71% of users feel frustrated when the chatbot can't answer their questions.
- 64% report a bad experience when the chatbot fails to understand what they need.
- 43% are dissatisfied when not given the choice to speak with a human representative.
- 36% have a negative experience if the chatbot asks too many questions without resolving their issue.
- 18% find it bothersome to start the conversation over when initiating a new chat.
- 17% of users are frustrated when the chatbot directs them to another communication channel like phone or email.
Many research results on this topic will play a big role in your decision, so let's see what else is out there:
- In 2022, 69% of customers were open to using AI to improve their experiences. This openness decreased slightly in 2023, with 56% of total customers being open to AI use. (Salesforce)
- 53% of customers believe generative AI will help companies better serve customers. (Salesforce)
- Personalized Interactions: 64% of these reps say AI helps personalize customer interactions. (Hubspot)
- 77% of decision-makers who partner with IT say it helps the organization save on software costs, and 79% say it results in faster time-to-market for new technology solutions. (Salesforce)
- 68% of support teams say AI has directly influenced customer expectations. (Intercom)
- 77% of support teams believe that AI will accelerate customers’ expectations of fast response times. (Intercom)
The Importance of Offering Multi-Channel Support
Offering multi-channel support means being where your customers are, whether that's on the phone, email, social media, or live chat.
It's important because it lets customers choose their favorite way to get help, making it easier and faster for them to reach out when they need you.
- 42% of customers ranked reaching customer service agents on their preferred channel as the most important attribute of the customer experience. (Gladly)
To offer multichannel support, it is good to know which channels customers use:
Self-service in customer service is when customers help themselves without needing to talk to someone at the company.
- 31% use self-service before contacting brands directly.
- In fact, 61% of customers say they would prefer self-service if a really good self-service is offered.
Salesforce research shows that it is important not only to offer multichannel support but also to have a unified attitude across each channel.
- Although 79% of customers expect consistent interactions across departments, 56% often have to repeat or re-explain information to different representatives.
- 70% of customers expect all company representatives to have the same information about them.
- 55% say it generally feels like they communicate with separate departments, not one company.
As the statistics above show, it is not easy to offer multi-channel support across channels, and Salesforce shows the rates of these difficulties as a result of the study:
- 85% of respondents claim to provide customers with at least one self-service solution. (Deloitte)
- Although self-service channels remain in focus, only 8% of service managers believe their customers want to be able to solve their problems themselves. (Deloitte)
The Impact of Social Media on Customer Service
Social media has changed customer service by making it easier for customers to talk to companies and tell others about their experiences.
If someone has a question or a problem, they can just message the company on social media and often get a fast response.
Plus, when companies are good at customer service on social media, everyone sees it, and it can make customers like them even more.
Sprout Social shows us the platforms that US consumers and brands use most for customer service:
- 35% of U.S. consumers use Instagram for customer service. (Sprout Social)
- Telecommunications provider Jawwy achieved a customer satisfaction score (CSAT) of 87%. (Khoros)
- 43% of companies offer customer service through DMs. (Hubspot)
- At the same time, Hubspot shows the rate of social media users reaching customer service via DM in the last 3 months. There is a 27% increase from 2022 to 2023. You can predict that this number will increase even more in 2024.
According to Sprout Social's report; how fast consumers expect a response from brands on social media:
Within Minutes:
- 2023: 16%
- 2022: 13%
Within 1-2 Hours:
- 2023: 23%
- 2022: 22%
Same Day:
- 2023: 30%
- 2022: 42%
Within 2 Business Days:
- 2023: 19%
- 2022: 17%
Response Time Does Not Matter to Me:
- 2023: 12%
- 2022: 6%
The Value of Customer Feedback for Improving Customer Satisfaction
Customer feedback is super valuable because it's like a guide that tells a company what's working well and what's not. That's why you need to explore different ways to get customer feedback.
When customers share their thoughts on what they like or don't like, the company can use that info to make their service better.
Intercom and Deloitte research shows that support teams rely on a few key ways of measuring the customer experience:
- Customer satisfaction (CSAT) score: 57%
- NPS- Net promoter score: 57%
- Online reviews and ratings: 30%
- Follow-up calls or emails: 30%
- FCR- First contact resolution: 29%
- CES- Customer effort score: 21%
Here are the other research results on collecting feedback in improving customer service:
- 70% of customer service organizations carry out employee satisfaction surveys on a regular basis. (Deloitte)
- Almost the same number of leaders 72%, consider their employees to be satisfied or very satisfied. (Deloitte)
- Only 59% of companies allow customers to provide feedback on product and service functionality. (Accenture)
- 31% reported that timely handling of feedback is a challenge. (Accenture)
- Among the customer service leaders, 29% cited collecting data in real-time as a barrier. (Accenture)
This graph tells us that when companies make their products better by listening to customer feedback, customers tend to value these products more.
- In fact, how good a product is makes up about 30% of why customers like it, and the quality of the service is another 20%. (Accenture)
So, paying attention to customer feedback is a big deal because it helps make both the product/service you sell and the help you give even better.
Frequently Asked Questions
1. What Percentage of Customers Pay More for Customer Service?
According to the provided statistics, 72% of shoppers are willing to pay more for a brand that offers an exceptional customer experience (Gladly).
This indicates that a significant majority of customers place high value on the quality of customer service and are ready to spend extra for great service.
This statistic highlights how crucial excellent customer service is for businesses, as it directly influences consumer spending behavior and brand loyalty.
2. How Do Customer Service Representatives Feel AI Impacts Their Work?
According to Hubspot, 84% of customer service reps using AI believe it simplifies their workflow, In particular, it shortens the response time to customer questions.
This allows for more efficient service and can free up time for reps to personalize their interactions.
Furthermore, 64% of reps feel that AI helps in personalizing these customer interactions, leading to a more tailored and satisfactory customer experience.
3. How Often Do Customers Prefer to Use Self-Service Options Over Contacting a Customer Service Representative Directly?
Salesforce reports that 31% of customers turn to self-service channels before contacting a brand's customer service directly.
This preference is even more significant when considering that 61% of customers would opt for self-service if the options provided are comprehensive and user-friendly.
This trend underscores the importance of developing robust self-service platforms that empower customers to resolve issues independently.
Conclusion: Crafting the Ultimate Customer Service Experience
In our customer service statistics journey to 2024, we've seen that while AI and chatbots are changing the game, the essence of service remains deeply human.
Creating the ultimate customer service experience doesn't just mean jumping on the latest technology. It's about striking a balance - using AI to handle the basics and leaving your skilled team free to tackle more complex customer needs.
And keep in mind that even as expectations rise, the goal remains to solve problems efficiently, make your customers feel heard, and exceed their expectations at every opportunity.
Recommended Blog Post
- 42+ Live Chat Statistics That You Need to Know in 2024
- Top 40+ Must-Know Chatbot Statistics for 2024
- 12 AI Chatbots for SaaS to Accelerate Business Success
- 11 KPIs for Customer Retention: The Key to Customer Loyalty
- 10 Effective Ways to Reduce Customer Acquisition Cost (CAC)
