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10/13/2010
12:07 PM
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Consumers Will Pay More For Superior Service

Shoppers say they'll give companies a chance to correct negative experiences, underscoring the importance of monitoring complaints on social networks.

IT Hall Of Shame, Part 2
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IT Hall Of Shame, Part 2
Customer experience plays a critical role where consumers shop for and continue to buy products and services -- and shoppers are willing to pay a premium to guarantee superior customer service, a new report finds.

In fact, 85% of those polled would be willing to pay more than the standard price in order to ensure a superior customer service. Of those, 76% would pay 5% or more; 55% would ante up 10% or more; 27% would pay a 15% or greater premium; 18% would add 20% or more; and 10% would pay 25% or more, according to a Harris Interactive poll conducted for RightNow Technologies.

"This year's report not only demonstrates the financial impact of a negative customer experience, but the real value of positive customer experiences. By focusing on delivering exceptional experiences, businesses have the opportunity to grow their customer base, improve brand loyalty and increase overall revenue," said Greg Gianforte, CEO of RightNow, which develops a customer experience suite of solutions.

Consumers already are voting with their wallets, since 55% of respondents became a company's customer because of its reputation for great customer service, they said. Forty percent switched to a competitive brand because of its customer service reputation, the study found.

But shoppers are not quietly leaving dissatisfying experiences behind. Rather, 79% told others about their encounters, the report said. Their reasons? The vast majority, 85%, wanted to warn others about the pitfalls of doing business with that particular company; 66% wanted to discourage people from interacting with that vendor; 55% wanted to vent their anger or disappointment; and 24% wished to see if the company would respond.

The report underscores the value and importance of monitoring social media for customer feedback since all, apparently, is not lost if consumers are unhappy about service or product quality. After all, 92% of respondents said they would be willing to return to a company after a negative experience. Of those, 66% wanted a follow-up apology or correction from a supervisor or the head office, 52% wanted a discount, and 49% needed proof of enhanced customer service, according to Harris Interactive.

Fifty-eight percent of respondents would like a company to reply if they leave a comment on a social networking site. However, only 22% of those who did leave a comment actually got a response, the report found.

Consumers value feedback from fellow shoppers, the report said. Word-of-mouth was the most influential component of a shopping decision, according to 76% of those polled, followed by customer reviews and online feedback by 49% of respondents, and product review sites at 41%. Other influencers included magazine articles at 23%, and reputation on social networking sites such as Facebook, Twitter, and YouTube, at 7%, the RightNow study said.

About two-thirds of respondents said businesses can encourage consumers to spend more by improving their customer service, while 61% said companies should provide more accessible information and make people more available for questions prior to shoppers' purchasing decisions. Almost one-quarter of respondents recommended businesses create a tailored shopping experience, the poll said.

When it comes to a not-so-great shopping experience, much of that responsibility fell on the shoulders of sales staff. Of those who decided to stop doing business with a company, 73% said it was a reaction to rude staff and 51% said the problem was unknowledgeable staff, according to the study. In addition, 55% cited issues that were not resolved in a timely fashion, the report found.

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