Customers expect seamless customer service from a company, and meeting their expectations is crucial for a company to survive. But how crucial is it?

Our survey indicates that customer service is a key factor that can even lead to the end of a business relationship within a short period.

A significant proportion, 68% of customers reported breaking a business relationship with a company in the past due to a bad automated phone self-service (IVR) system.

That means consumers get frustrated if they find it difficult to approach a support representative over the phone. So, companies need to be cautious while servicing their customers.

Poor call IVR experience is not the only factor that can cause individuals to sever their relationship with a business, our survey revealed the top 5 specific reasons that can severely impact business relationships.

Key Takeaways

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  • 68% of respondents who ended a business relationship cited a bad automated phone self-service (IVR) system as being a major reason for their decision.
  • 65% of respondents ended a business relationship because they have to explain their situation every time they contact customer support.
  • 60% of the respondents stated that long wait times to talk to a representative made them take the action.
  • 50% of respondents who ended a commercial relationship cited unskilled support representatives as a cause of action.
  • 46% of respondents experienced insecure handling of personal information and ended a business relationship with a company.

On experiencing poor customer service:

  • 16% of customers would end a business relationship instantly.
  • 23% of customers would end a business relationship within the same hour.
  • 45% of customers would break a business relationship within the same day.
  • 76% of customers would take business elsewhere within a week.

Top 5 reasons for the end of business relationships

There can be many reasons that make consumers cease a business relationship with a company and if you ask them, the list will never end.

To know the most common reasons, we asked consumers to pick the top 5 reasons that made them break commercial relations.

If you ended a business relationship with a company because of a poor CUSTOMER SERVICE experience, can you pick the top 5 reasons?

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#1: The largest proportion, 68% of customers got stuck in the automated phone self-service (IVR) and found it difficult to reach a customer service representative, causing them to experience a great deal of frustration with the business and end their relationship. That means, 7 out of 10 customers expect a company to provide well-optimized customer service over the phone

#2: 65% of customers took the business away from a company due to the need to re-explain the issue every time the customer communicated with a company’s customer service. Regardless of the channel customers choose to contact a company’s support, they have to repeat themselves every time.

Customers expect an optimized support system within the company that stores the information they provide, so they don’t have to re-input every time they contact a company.

#3: Almost 6 out of 10 customers stated that long wait times on the phone to talk to a support representative was a cause for ceased business relations.

#4: 50% of the respondents said that they took the business away from a company due to unskilled support representatives.

That means half of the consumers got disappointed because the support representative wasn’t empowered enough to make decisions that could resolve their issues.

#5: 46% of the respondents faced privacy issues with a company and reported breaking of business relations due to privacy concerns. So, consumers are cautious towards their private information and can take business away from a company if it’s not handled securely.

A significant proportion of shoppers also picked a few other reasons for the end of a business relationship which are as follows:

  • 36% of customers said that they were forced to wait too long on webchat.
  • 28% of customers chose poorly designed mobile apps as a cause of termination.
  • 27% of customers reported an end of a business relationship due to the company’s failure to recognize them based on loyalty.

How consumer behavior varies by age?

The survey also revealed a significant variation in consumer behavior across various age groups (younger and older consumers).

The major reason for the end of business relations

The largest proportion (60%) of younger consumers (aged 18-44) cited the need to re-explain the situation every time they contacted a company’s customer service as the most significant cause for ending a business relationship.

On the other hand, the majority (74%) of older consumers (aged >44) cited a poor phone self-service system (IVR) as a major cause for the cessation of a business relationship while a slightly smaller proportion, 57% of younger consumers (aged 18-29) cited the same cause.

We also observed a significant disparity among age groups based on various customer service factors mentioned as follows.

Privacy

Our survey indicates that consumer’s concern about privacy decreases with increasing age. Younger consumers appear to be more concerned about their sensitive personal information compared to older ones.

consumer-privacy-concerns-

A significant proportion, 59% of consumers aged 18-29 ceased a business relationship due to insecure handling of their private information while just 33% of consumers aged 60+ did the same.

History and Value of The Customer

Customers expect a company to recognize them based on their loyalty and history with it. Otherwise, it can become a reason for the end of commercial relations.

Even here, younger customers are more likely to end business relations compared to older people, if they’re not valued by a company. 

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Customers expect a company to recognize them based on their loyalty and history with it. Otherwise, it can become a reason for the end of commercial relations.

Even here, younger customers are more likely to end business relations compared to older people, if they’re not valued by a company.

Mobile App Experience

Here also, younger consumers seem to harbor more expectations from a company’s mobile app compared to the older ones.

mobile-app-experience-

 35% of younger consumers (aged 18-29) ended a business relationship with a company due to its poorly designed mobile app while merely 18% of older ones (aged 30-44) did the same.

Not only the design, but consumers are also sensitive to the push notifications they receive from a mobile app. Our survey on app push notifications indicates that 64% of app users would stop using an app if they receive more than 5 weekly push notifications from that app.

Need to re-explain the situation

Older shoppers get more annoyed than younger ones when they have to repeat themselves every time they contact customer support. 

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A large extent, 74% of old agers (aged >60) cited bad omnichannel experience as a cause for the end of commercial relations compared to a slightly less 58% of young shoppers (aged 18-29).

Bottom Line: Companies can consider prioritizing the customer issues based on the age group of their customers.

For instance, a company can focus on improving response time, privacy, and mobile app experience first if it consists of a younger customer base (aged below 45). On the other hand, if the customer base consists of older people (aged 45+) then it can prioritize focus on upgrading phone support and omnichannel experience.

So far we discussed the top reasons that caused consumers to end a commercial relationship and variation in consumer behavior based on age groups but…

How Soon Customers Act on Poor Customer Service?

Customers seem to harbor much dislike for bad service experience but a company can prevent a significant amount of its customers from shifting to its competitors if it resolves their issues on time.

To know the customer’s patience level toward poor customer service, we asked them the below question.

If you experience poor customer service with a company, how soon would you end your business relationship with that company and take your business to their competitor, should they satisfy your criteria?

how-soon-consumers-end-business-relationships

The above data indicates the low patience level of consumers who would end a business relationship within a short period.

More the time a company takes to resolve its customer’s issues, more the customers it will lose.

Almost half (45%) of consumers would terminate a business relationship within the same day of experiencing poor customer service.

Over 16% of shoppers expect a real-time resolution to their issues and would cancel a business relationship with a company instantly if they encounter a bad customer experience.

23% of shoppers would end a business relationship within an hour of facing bad customer service. A larger proportion – 76% of shoppers would shift the business elsewhere within a week of experiencing poor customer service.

ONLY 24% of consumers would wait for more than a week after experiencing poor customer service.

How does a customer’s patience vary by age?

Here also, we noticed a significant variation in patience levels among various age groups, older consumers seem to discontinue a business relationship sooner than younger ones.

how-consumer-behavior-vary-across-different-age-groups

A bigger proportion – 20% of older shoppers (aged 44+) would terminate a business relationship instantly while just 12% of younger ones (aged 18-44) would do the same.

Within the same hour of facing inadequate service, over 25% of consumers aged above 44 would break a business relationship while a slightly smaller proportion, 21% of consumers aged 18-44 would take the same action.

Suggestions on Improving Customer Service Experience

If you offer phone support, make sure the self-service is easy to navigate. As per Zendesk, more than half of the consumers contact a company’s customer support over the phone. That’s why, a bad IVR system is also the foremost reason for a discontinued business relationship with over 68% of customers who got frustrated because of it.

Impart proper training. Almost 5 out of 10 consumers discontinued a commercial relationship with a company whose customer support representatives weren’t skilled enough to resolve their issues.

Take care of customer’s privacy. 45% of customers cited insecure handling of personal information as a cause for ending a business relationship. So, customer’s privacy is a sensitive factor and companies need to pay attention to it.

Consider the age group of customers. Our survey indicates significant variation in consumer behavior among the older and younger age groups. Older people appear to harbor less patience compared to younger ones, so a company should definitely aim to offer exceptional standards of customer service if the older demographic forms a major portion of its customer base.

Minimize wait times. Long wait times can frustrate consumers and can even make them break a business relationship. Around 60% and 36% of consumers cited high response time over the phone and webchat, respectively, as a cause of termination.

Survey Details

Helplama team surveyed over 500 consumers based in the United States that consists of 47% of men and 53% of women to know the consumer behavior.

Category of Consumers

We have divided users into 4 age groups:

  • 18-29
  • 30-44
  • 45-60
  • >60

 

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