Brands must create outstanding customer service to win loyalty, finds report

New Optus Future of Business report finds only 39 per cent of consumers reporting a good experience are likely to remain a customer of that organisation

Optus Business president, John Paitaridis
Optus Business president, John Paitaridis

A new Optus report has found only 12 per cent of Australian organisations are delivering outstanding customer experiences despite the fact that 95 per cent of consumers will remain loyal to organisations that do so.

The fourth Future of Business report, which was released during the Optus Vision conference in Sydney on 18 June, found only 39 per cent of customers reporting a good experience are likely to remain a customer of that organisation, compared to 95 per cent of customers who reported an outstanding one.

Customers with an outstanding experience were also five times more likely to become brand advocates compared to customers with good experience.

By contrast, nearly 80 per cent of customers who reported a bad experience said they took some form of action such as complaining to friends or via the Internet.

The Optus report was based on surveys of 550 organisations across enterprise and government, as well as more than 5000 customers.

It also found customer experience and advocacy were the first or second top priority for nearly half of all organisations surveyed, although only 45 per cent said they understood the impact of customer experience on profits and revenue.

Top hurdles to better customer engagement were budget constraints (47 per cent), competing internal agendas or priorities (38 per cent), and lack of department alignment (33 per cent).

Speaking at the Sydney event, Optus Business president, John Paitaridis, urged businesses to strive for more than "good" customer experiences if they want to meet expectations.

“We should not be surprised that ‘good’ is not ‘good enough,” he told attendees. “However, you may be surprised with the difference between what good means and what outstanding means, because that has a massive impact on customer loyalty and retention.

“The key point here is the majority of our customers are at risk if the only level of service we’re providing is only ‘good’. Only outstanding customer experience creates advocates.”

Key things consumers want from brands include engaging with staff that are friendly, meet their needs and are knowledgeable. They also want to interact with real people as often as they can and feel valued, Paitaridis said.

According to the report, 60 per cent of customers can tell when an employee doesn’t have the information and tools to be able to deal with their request, and more than one-third notice when staff members make them wait.

“We can’t hide – customers can see what’s happening and their expectations are high. And as we are listening to customers and trying to get better, the bar keeps moving higher,” Paitaridis continued. “Customer expectations will rise over the next one to two years.”

A key reason is the rapid adoption of technology, which is enabling customers with more choices than ever before, he added.

The Optus report also found 51 per cent of organisations surveyed claimed customer experience is driving technology investments, but are failing to put the right amount of value on the human element of the equation.

For instance, organisations delivering an average customer experience lack in-house skills (43 per cent) buy-in or engagement from staff (38 per cent) and a clear customer experience strategy (32 per cent).

Additionally, organisations with well-aligned departments were far more likely to deliver strong customer experience.

More from CMO on the importance of becoming customer-centric:

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