Products are increasingly becoming commoditised, leaving customer service as one of the few remaining competitive differentiators. And in a world where customer-centricity matters more than ever, customer service-based metrics are more than just a box-ticking exercise: in a very real sense, they are milestones on the journey towards long-term survival and success.
For most of the last few months, Britain’s regulated telecoms company, BT, has been in the firing line. Customers, competitors, and members of Parliament alike have all complained that BT’s rollout of superfast broadband is not fast enough, nor extensive enough.
Others’ concerns are more prosaic. Last autumn, for instance, I was driven to write a blog post about the truly awful customer service I experienced when I tried to get a telephone line installed for my daughter.
Hours spent on the phone, promised call backs that never materialised, time taken off work in order to wait in for BT engineers who never arrived – and all the time, direct debit payments were being taken, for a service that we weren’t receiving. BT was happy to take our money – yet incapable of providing the most basic of services, a simple telephone line.
The irony, of course, is that BT spends a fortune on advertising and mailshots, trying to win customers, bombarding consumers with offers. And in the case of customers driven to desert the company because of its customer service, one can’t help but wonder if it might not be cheaper to simply improve that customer service.
And indeed, influential studies by researchers and management experts such as Fred Reichheld – author of The Loyalty Effect – show that it costs around five times more to attract a new customer than retain an existing one.
Despite this, the kind of customer service that I experienced from BT is far from unique: right across huge swathes of business – retail, transport, consumer durables, banking, utilities – huge numbers of businesses generate bad press and complaints through delivering awful customer service.
In one sense, those complaints are good news: market insights from the coal face, obtained at minimal acquisition cost. Free information, in other words – information with which to inform decisions about how to do business better in future.
About the Author
Professor Richard Wilding OBE is a Full Professor at the Centre for Logistics & Supply Chain Management, Cranfield School of Management, and the UK Chairman of the Chartered Institute of Logistics & Transport UK. He is a recognised expert in logistics and supply chain management.