Heavily criticised telcos and ISPs working hard to win back customers: report

Heavily criticised telcos and ISPs working hard to win back customers: report

Customer retention efforts by telcos and ISPs have dramatically increase according to a recent customer service satisfaction report

Telecommunication providers and ISPs are now working harder than before to win back old customers and keep existing ones, according to a recent customer service satisfaction report.

Customer relationship management (CRM) vendor, RightNow, has released its Customer Experience Report 2011 which analysed data from surveys done on 719 individuals in different demographics. The research was conducted by analyst firm, StollzNow.

The report covered seven key industries: Telecommunications, ISPs, insurance, financial services, travel, utilities and online retail.

Telcos and ISPs, unsurprisingly, performed poorly in terms of customer satisfaction and customer service. Only 18 per cent of people surveyed were happy with the service they received from telcos as opposed to 28 per cent with ISPs. A whopping 67 per cent claimed to have experienced poor customer service with telcos and 47 per cent with ISPs. Judging from the record number of complaints handled by the Telecommunication Industry Ombudsman (TIO), this isn't shocking news.

Fifty-five per cent of respondents said they stopped doing business with their telco due to poor customer service. That figure was 57 per cent for ISPs.

Just think of the level of burn and churn in this - how many customers are lost due to poor service.” StollzNow director, Neil StollzNow, said at the report launch event in Sydney. “This is not an arbitrary claim of ‘if you have poor service you can lose customers’.

“Here is the data; you can lose half or more of your customers due to poor customer service.”

The results were consistent with figures in last year’s report.

One surprising revelation from the report was how keen companies were to win back old customers. Telcos and ISPs fared the best in this field.

In 2010, around 44 per cent of survey respondents said their telcos made efforts to lure them back or retain them. Fast-forward one year, that figure has jumped to 58 per cent, a 14 point difference.

ISPs had an even more dramatic shift with 44 per cent of people reporting ISPs trying some form of customer retention as opposed to 29 per cent in 2010.

In fact, numbers in that area have significantly improved across all seven industries.

StollzNow did not investigate further into why companies were now desperately trying to win back favour from customers.

“In the past, new customers have been the measure of reward and customer retention had been a backwater,” Stollznow said. “Something has happened over the last year that has got a wide range of businesses across many industries looking at customer retention.”

In the ISP area, perhaps the data could be partially explained by the over-saturation of the ADSL market.

“The time of accumulating as many customers as possible is over,” iiNet chief, Michael Malone, told ARN last week. “If it’s not over for everybody then it’s in the final stages.

“We now have to win every new customer from somebody else and that will play out in the next year or two.”

Analysts have predicted more consolidation in the ISP market as opportunities to win more ADSL customers diminish.

The Customer Experience Report also revealed customers are now favouring online interaction with businesses more than ever before although most still prefer to talk to companies over the phone.

Note: This is vendor sponsored research

More to follow.

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Tags iiNetTelecommunicationsRightNowISPsMichael Malonemobile solutionsStollzNowBraycustomer experience report


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