Return on Behavior Magazine
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Customer Experience

October 26th, 2010

50 Facts about Customer Experience

50 facts

Following from the success of our past article “23 facts about customer loyalty and customer satisfaction” we have compiled a list of 50 facts that you should know about customer experience to help you follow the trends and stay ahead of the competition in 2011.

Facts about customer experiences and referrals

  1. 96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back – 1st Financial Training services
  2. A dissatisfied customer will tell between 9-15 people about their experience. Around 13% of dissatisfied customers tell more than 20 people. – White House Office of Consumer Affairs
  3. Happy customers who get their issue resolved tell about 4-6 people about their experience. - White House Office of Consumer Affairs
  4. Happy customers who get their issue resolved tell about 4-6 people about their experience. - White House Office of Consumer Affairs
  5. 70% of buying experiences are based on how the customer feels they are being treated – McKinsey
  6. 55% of customers would pay extra to guarantee a better service – Defaqto research
  7. Price is not the main reason for customer churn, it is actually due to the  overall poor quality of customer service – Accenture global customer satisfaction report 2008
  8. 94% of customers do not want to be transferred to another representative more than once – Mobius Poll 2002
  9. 80% of customers prefer to speak with a representative at the weekends - Mobius Poll 2002
  10. 84% of customers are frustrated when a representative does not have immediate access to account information - Mobius Poll 2002
  11. Customer who rate you 5 on a scale from 1 to 5 are six times more likely to buy from you again, as to if they ‘only’ gave you a score of 4.8. – TeleFaction data research
  12. It takes 12 positive experiences to make up for one unresolved negative experience – “Understanding Customers” by Ruby Newell-Legner

TeleFaction, Customer Experience Management, CRM, Loyalty, Customer Satisfaction

Facts about customer retention and churn facts

  1. A 5% reduction in the customer defection rate can increase profits by 5 – 95% - Bain & Company
  2. A 50% reduction in customer base would occur if left alone over a 5 year period – Bain & Company
  3. It costs 6 – 7 times more to acquire a new customer than retain an existing one – Bain & Company
  4. An average company loses between 10 – 30% of its customers annually - McKinsey
  5. A customer is 4 times more likely to defect to a competitor if the problem is service related than price or product related – Bain & Company
  6. 68% of customers leave because they were upset with the treatment they received whilst speaking to customer services – US Chamber of Commerce
  7. Dissatisfied customers whose complaints are taken care of are more likely to remain loyal, and even become advocates, as those that are ‘just’ customers – Strauss & Seidel
  8. The probability of selling to an existing customer is 60 – 70%. The probability of selling to a new prospect is 5-20% - Marketing Metrics
  9. For every customer complaint, there are 26 other unhappy customers who have remained silent – Lee Resource
  10. 96% of unhappy customers don’t complain, however 91% of those will simply leave and never come back – 1st Financial Training services
  11. A 2% increase in customer retention has the same effect as decreasing costs by 10% - Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy
  12. Customer profitability tends to increase over the life of a retained customer - Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy
  13. In the US alone, people that switch from insurance providers represent a $7.6 billion market in annual premiums – JD Power & Associates

Facts about customer service and contact / call centers

  1. A good customer service strategy should balance costs, quality and revenues. Companies that restructure call centers in this way can often cut their costs by up to 35% and boost the revenue they generate by as much as 35%, thereby transforming them into strategic assets providing a competitive advantage – McKinsey
  2. Research shows that a 10% increase in customer retention levels result in a 30% increase in the value of the company – Bain & Co.
  3. 76% of companies motivate employees to treat customers fairly, and 62% provide effective tools and training to gain trust with their customers – Peppers and Rogers Group, 2009 Customer Experience Maturity Monitor
  4. 70% of customer experience management best in class adopters use customer feedback to make strategic decision. 50% of industry-average organizations and 29% of laggards do. – Aberdeen Group
  5. 81% of companies with strong capabilities and competencies for delivering customer experience excellence are outperforming their competitors – Peppers and Rogers, 2009 Customer Experience Maturity Monitor
  6. 72% of all customers believe it takes too long to reach a live agent – Harris
  7. 69% said they were on hold for too long – Harris
  8. 50% of the people survey said that agents failed to answer their questions – Harris
  9. 44% said the information they received was not accurate- Harris
  10. 92% of all interactions happen via the phone – Gartner
  11. 85% of consumers are dissatisfied with their phone experience – Gartner
  12. Even in a negative economy, customer experience is a high priority for consumers, with 60% often or always paying more for a better experience. - Harris Interactive, Customer Experience Impact Report

Employee facts

  1. The average recruitment cost of filling a vacancy is £4333, increasing to £7750 when organizations are also calculating the associated labour turnover costs – The Chartered Institute of Personnel and Development Annual Survey
  2. Employee churn in the private sector is 22.6% - The Chartered Institute of Personnel and Development Annual Survey
  3. An average of £1202 is spent on employee training  - The Chartered Institute of Personnel and Development Annual Survey

Facts about customer strategy

  1. 90% of North American firms view customer experience as important or critical to 2010 plans. 80% of firms would like to use customer experience as a form of differentiation. – Forrester’s: The State of Customer Experience 2010.
  2. 85% of business leaders agree that traditional differentiators alone are no longer a sustainable business strategy – Shaw & Ivens
  3. 71% of business leaders believe that customer experience is the next corporate battleground – Shaw & Ivens
  4. eCommerce spending for new customers is on average $24.50, compared to $52.50 for repeat customers – McKinsey
  5. Reducing time and money on explaining business procedures and costs with new customers will save overall – Marketing Management; Spiro, Rich, Stanton 2008
  6. 73% of marketing managers of various large companies credit “Repeat purchase behavior” as integral to the definition of successful customer engagement –Forbes Magazine
  7. A survey asking which is the most important marketing objectives, shows that 29.9% think that it should be customer acquisition, and 26.6% think that it is customer retention. However 62.2% admit that they concentrate on customer acquisition, with only 20.6% focusing on customer acquisition. –Emarketer
  8. 55% of current marketing spend is on new customer acquisition – McKinsey
  9. 33% of current marketing spend is on brand awareness – McKinsey
  10. Only 12% of current marketing spend is on customer retention - McKinsey

About the Author

James Digby

For several years James has been involved in startup and entrepreneurship throughout the world. James ever growing network amongst marketing wizard’s, VC’s and startup gurus is invaluable. James is a thought after keynote speaker with strong opinions on all things startup related with recent events with Athens, Moscow, Amsterdam and London. 






 
 

 
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57 Comments


 
 

  1. Thank you, James, for posting these facts. Once business owners are presented with this information and the economic benefit of customer retention, they are very eager to implement plans to improve customer service, loyalty, retention…and profits!
    Dan Alcorn
    Niskayuna, New York USA


  2. Thank you so much for the article, you have captured all of the facts. As a business consultant my specialty is sales/customer service. I believe a good company focuses on sales, a great company focuses on customer service and will get the sales. I read somewhere, “Consistency is better than good salesmanship.” My book is called, Red Hot Customer Service, 35 sizzling ways to heat up your business and ignite your sales. Thanks again for all of the reasearch.


  3. Lary Stucker

    Do you have any links to your US Department of Consumer affairs quotes?


  4. The stats are taking from the TARP study commissioned by the White House Office of Consumer Affairs titled “Ineffective That’s One Problem with Satisfaction Surveys”.


  5. María

    Hi James, thank you!! for put all the customer facts all together… including the sources.

    Do you have any information about: customer experience and behavior, companies managment of complaints, customer services regulatory laws applied to the Spanish market?

    Can you suggest or recomend sites about this matter?

    Thank you in advance and keep such a good work!!


  6. Douglas

    Brilliant! Thanks James

    Douglas


  7. The number one tip of the 5 tips for managing an excellent customer experience is - make sure that employees know that they’re part of a vision, not just a job. Employees that feel empowered will always work harder to create the best customer experience possible.


  8. Gokce

    Brilliant and useful. Thank you very much James.

    Sincerely, Gokce.


  9. Sascha

    Hi James! Excellent work putting together all those facts & figures. Do you have a more detailed sources/link for the Bain & Co citations on “Facts about customer retention and churn facts”?
    Thanks in advance!


 
 



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