Bad customer service in Singapore costing businesses $26bn as consumers switch brands

The scamming of a Vietnamese tourist in Singapore brought customer service to a head in 2014

The scamming of a Vietnamese tourist brought poor customer service in Singapore to a head in 2014

More than two thirds of Singapore consumers have switched service providers in the last year due to poor customer service, research from Accenture has found.

Retailers, banks, and internet service providers experienced the highest turnover of customers as a result of poor customer care, which Accenture estimates has cost Singapore businesses $26 billion.

Singapore’s high customer churn rate (68%) compares with 42% in Japan, 52% in the US and 83% in China.

More than half of Singapore respondents (51%) say they won’t be back after switching providers.

The report suggests Singaporeans are unhappy with service levels as a result of over-automation, not necessarily bad service from human beings.

Fully 83% said they prefer human interaction to digital channels to solve customer service issues, compared to 62% in China and 61% in Japan.

Just under half (47%) of Singaporean consumers say there are willing to pay more for goods and services if they come with better service – far less than in China where 79% will pay more for better customer service, but more than in service-oriented Japan, where 43% will pay more.

“Companies wrongly assume that their digital-only customers are their most profitable, and that customer service is a cost,” Alison Kennedy, Asean MD of Accenture Strategy, commented about the findings.

“Companies have lost sight of the importance of human interaction and often make it too difficult for consumers to get the right level of help and service that they need.”

She said that companies “over-invest” in digital technologies and channels and lose their most profitable customers – multi-channel customers – who want an on- and offline experience.

More than half of Singaporeans (57%) agree that in-store service is the best channel for getting a tailored experience, and half say they are more willing to be sold new or upgraded products when receiving a face-to-face service compared to online.

More than a third (39%) of Singapore consumers would rather go to a store first than use digital channels to get advice on the best products and services.

Customer service is a topic of ongoing national debate in Singapore, with the prime minister last week remarking that the citystate still has a long way to go to improve its service culture. A report from 2014 found that most Singaporeans will not speak up about bad service, but will take their business elsewhere instead.

Bad customer service in Singapore made international headlines in 2014, when a Vietnamese tourist was mistreated and scammed on the purchase of an iPhone. His teary plea for fair treatment went viral.

Following up with Accenture on why Singaporeans would rather face to face customer service than automated when the former is so poor, Kennedy commented: Think back to the last time you really needed to speak to your cell provider, bank or utility company. Maybe you had a query about an incorrect bill, perhaps you needed some advice or wanted to cancel your contract or service agreement. How easy was it to reach them?”

“How simple was it to actually speak to somebody who could help you resolve your issue? According to our research, it’s becoming increasingly challenging for consumers to do so. In certain situations, specifically resolving issues and complaints, and getting advice, consumers in Singapore prefer a human interaction over a digital one,” she said.

Accenture’s research was part of the company’s Digital Disconnect in Customer Engagement report, which is based on the Global Consumer Pulse Research. This gauges the experiences of 24,489 consumers around the world about marketing, sales and customer services; 350 consumers in Singapore were included in the sample.


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