In spite of the ongoing recession and general belt tightening by consumers, the fact remains people will still pay more for better customer service. But, even a good experience has a price point. So, just how much more would they be willing to pay?
The answer: 10 percent more! That’s what a surprising 70 percent of the responding consumers said in a survey recently conducted by The Strativity Group and reported by Stacy Straczynski in Progressive Grocer magazine. Even more interesting was the fact that about 33 percent of the 2,000 consumers polled between April 13, 2009, and May 4, 2009, were willing to pay 25 percent or more for exceptional customer service!
Not so surprising, the study noted that satisfied customers were three times more likely to repeat their business for at least another 10 years. Conversely, those who had a negative experience were 10 times more likely to cease doing business with the company within 12 months.
No surprise here, either: Employee interaction was the top contributing factor to a good customer experience with the business. Effectively resolving problems, exhibiting common sense, and instances where employees exceeded expectations topped the list.
“The initial assumption that we had was that customer loyalty is dead, that the only loyalty is to price,” said Lior Arussy, CEO of Rochelle Park, N.J.-based Strativity. “But it’s not only about price sensitivity. The verdict from the consumers is very clear: if we see an exceptional customer experience, we’ll pay more for it, we’ll stay longer, and we’re going to give you more business.”
Interestingly, customers who appear to be unhappily “headed for the door” may not always be lost. It may be possible to keep them from bolting. In the survey, 52 percent of respondents said they’d be willing to continue their business if a discount of 5 percent or more was offered!
We’ve always known that the customer’s good experiences with our dealerships and the products we sell them have been the first building block of customer loyalty and repeat business. As an industry, we have been making customer service our highest priority in recent years. But, it never hurts to be reminded of these basic facts through studies and surveys that reconfirm it all for us.
Here’s today’s “How I Discovered Boating” video. Enjoy: http://www.youtube.com/watch?v=_4qcnT9IB3Q