Majority of U.S. Consumers: ‘Customer Service is Getting Worse’

Empathica Consumers Insights survey indicates that while Americans are spending less, retailers must cope with higher customer expectations.

By Gary Edwards, PhD, and Sherri Kolomayz

Q1 2010, Issue 2

Empathica Inc., a leading provider of Customer Experience Management (CEM) solutions to some of the world’s most respected brands, announced that its survey of more than 13,000 American and Canadian consumers reveals that the majority believe customer service is suffering in today’s economy.

Fifty-five percent of U.S. consumers feel their country’s customer service is getting worse, 13% are unsure, and 32% say they haven’t seen service suffering in this economy. Canadians  were less negative about their customer service, with 45% of consumers indicating customer service has gotten worse, compared to 39% who said it hasn’t gotten worse, and 16% reporting that they are unsure.

Customer Service in the US is Getting Worse

Regionally in the U.S., those in the South were more apt to say customer service is getting worse (58% of respondents), in contrast to the West who had 49% in agreement.

One in Five Consumers Value Good Service Over Good Food

Those who think customer service doesn’t matter should be aware. The data also revealed that customer service is so important to U.S. consumers, that one in five respondents said they value good customer service over good food. Younger people (18-34) were the bulk of respondents who responded this way, but were also the age group most forgiving of a bad experience at a restaurant.

Older customers (55+) were more willing to interact with management to either express their dissatisfaction, or offer a compliment.

“With consumers reducing their spending, they consequently have heightened expectations when they do go out,” explained Gary Edwards, EVP of Client Services at Empathica. “There is less tolerance for poor service, which is a huge challenge for casual and fine dining restaurant brands struggling with lower traffic, less incoming cash and higher expectations to deliver.”

The survey found that those who receive poor service — even at a restaurant they’ve been to several times — can cause huge damage to a brand. One in four U.S. consumers stated they would tell others not to go there in addition to never going again. In comparison, even more Canadians (28%) would take the same actions.

Despite Reduced Spending, Consumers are More Loyal to Brands They Love

While overall restaurant spending was down in 2009, the survey showed increased customer loyalty. In the current economy, consumers indicated they have been just as loyal (68.3%) or more loyal (15%) to specific restaurants.

The now commonplace practice of discounting and couponing, something unheard of for most casual dining brands just a year or two ago, seeks to entice new customers.

A coupon is most likely to encourage American consumers to try a new restaurant (44%), yet only 28% of Canadians agreed. In fact, a restaurant coupon or discount offer recently prompted 62% of Americans to go to a restaurant they might not have otherwise visited. Thirty-nine percent of Canadian consumers said the same thing.

“Expectations around the future economic outlook in part dictates consumer motivations for visiting a restaurant,” explained Edwards. “In this instance, our survey showed that while 67% of Canadians are optimistic about their economy, Americans are much more divided. Their consumer confidence is influencing their discretionary spending.”

About the Empathica Consumer Insights Panel:

The Empathica Consumer Insights serves as an authoritative voice on consumer based economic indicators; the retail, financial services and restaurant industries; consumer shopping intentions and customer satisfaction as reported by thousands of consumers in the U.S. and Canada. Results from Empathica’s Consumer Insights, led by Dr. Gary Edwards and Empathica’s Consumer Insights’ team, are published on a quarterly basis. The results are based on outbound Internet surveys with Empathica’s growing Insights Panel, derived from more than 30 million consumer surveys per year. Results have been weighted to reflect latest Census distributions in the U.S. and in Canada, including Region, Gender, Age and Income.

Aforementioned data is reported by the Empathica Consumer Insights Panel – Q1 2010, Issue 2.

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