Bad customer service in Singapore costing businesses $26bn as consumers switch brands
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.
The trouble with technology is Singaporean companies have not humanised it.
It is not a fault of technology, it is a fault of placing far too much reliance on it.
Technology does not absolve a company or its marketing departments to ‘seek first to understand.’ In other words conduct proper, structured research. If your research is not structured and based on ‘the scientific method’ you will get answers that will be as useful, as we say in Australia, as ‘teats on a bull!”
If you don’t understand expectations you will not succeed in meeting them. Whether you’re medium is digital or traditional. This is why Singaporean firms are failing with technology- they are neither understanding it not humanising it,.
A valuable behavioural framework that highlights how key understanding expectations is to success in any medium, is Professor Wolfram Schultz’s (Cambridge Neurooscience department) work on the subject which can be viewed here – https://www.psychologytoday.com/blog/your-brain-work/200911/not-so-great-expectations
ReplyOR ” bad service means 26 billion in opportunities to grow sales.” As long as people ( they are only consumers of the product they use ) are switching that is all good news and possibilities.
ReplyIt’s a bad case of overuse of software to categorise customers into clusters instead of understanding their needs and preferences. Companies feel that their processes and the software will be sufficient to give customers what they think they need…
ReplyNot knowledgeable customer service personnel and not helpful attitude are not going to help also…
ReplyI’ve seen the same numbers time and time again. However Accenture has overlook the fundamental problem that most traditional companies face in the digital era, they don’t speak ‘natural digital’ so customers don’t trust the interactions they have with those brands over digital channels. Patrick’s comments about ‘humanize’ are correct, but we have to remember ‘humane’ is contextual to the individual, the situation, and the need. Most companies in Singapore still ask me if I speak English or Chinese, even after doing business with me for a decade.
Customer’s don’t seek ‘face-to-face’, they seek and interaction they ‘trust’ and felt ‘heard’. It’s the core reason beyond the majority of Singapore Airlines complains, as staff follow procedures by the book, instead listening to customers. Emirates on the other hand empower staff to make personal decisions.
The best measure of effective communication is Maslow’s Hierarchy of Needs, most specifically the ability of the parties to reach ‘self-actualisation’. Which is only possible when they communicate on a trusted dialogue. In the digital era, Digital Natives achieve the highest self-actualisation, because the communication means is native to them. While most companies are lead by pre-internet executives that can’t even comprehend digital nativity.
It’s kind of like doing business in a foreign language. You might get the grammar and words right, but you’ll completely alienate local customs, slang and come across too ‘structure’.
ReplyI agree fully with how bad service has become especially with the banking sector . I closed all my Ocbc accounts last evening (thanks for the Sunday banking which must be costing the bank a lot of money and best part was that at least half of the young so called customer service officers were playing with their mobile phones at their stations as there was little to do) and gave up my Ocbc credit cards . The Filipino lady at the other end of the line at the credit card center and the exec behind the counter at the branch seem uninterested in my reason for doing so . So much for great customer service .. Everything is so perfunctory . I thought a complaint is a gift but obviously these two were not interested in my exiting the bank as a customer . And my beef for dunking Ocbc is that they levied financial and late charges on two of my cards – the ntuc and Robinson . The fine is worse than the government fines at $60 and $80 respectively for amount spent which is smaller than the fine ??? I did attempt to explain how they force me to go statement less on my credit cards but still sent me statements on my other accounts in drips and draps incl the easy credit account which is stagnant . One particular statement states that it was all my accounts at a glance but it contains one Visa card the 360 which I have reported lost a year ago ( no replacement ) … Total cock up and can’t seem to get their act together . Expensive lesson learnt dealing w this local bank
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