Accenture 2010 Global Consumer Research executive summary

IntroductionAccenture annually surveys consumers across geographies and industries about their experiences and behaviors. The 2010 Accenture Global Consumer Research assessed consumer attitudes toward marketing, sales and customer service practices in 10 industries among more than 5,800 people in 17 countries. This year’s survey highlights several important dimensions—and shifts—in consumer and provider relationships. Companies striving to achieve or sustain high performance should seek to understand how these consumer perceptions are impacting their own customer bases as well as the implications for future profitable growth.

page 1

Key Findings2010 findings showed the first decline in switching providers due to poor customer service in yearsFor the first time in six years, the number of consumers who switched service providers as a result of poor customer service declined in 2010. [Figure 1] The 2010 Accenture Global Consumer Survey found that 64 percent of consumers switched from at least one service provider—a bank, utility or wireless carrier, for example—due to poor customer service in 2010. This reverses a multi-year trend in which the number of consumers making a switch had steadily risen to a high of 69 percent in 2009.

Still, two in three consumers have switched companies in the past year due to poor customer service. Consumers in emerging markets are more inclined to switch providers due to poor service across all industries, especially within the retail and banking industries.

Figure 1

Switching in at least one industry due to poor customer service – Global Sample

Switching due to poor customer service by industry – Emerging vs. Mature Markets

Global 2010

Global 2009

Global 2008

Global 2007

Did not switch Switched

36%

31%

33%

41%

64%

69%

67%

59%

Retailers26%

40%18%

22%33%

15%

19%26%

15%

17%24%

13%16%

19%14%

13%20%

9%

10%18%

6%

10%16%

6%9%9%9%

8%12%

6%

4%3%

5%

Banks

Internet service providers

Wireless/cell phone companies

Home telephone service providers

Cable satellite television service providers

Life insurance providers

Hotels

Utility companies

Airlines

Another type

Global Emerging Markets Mature Markets

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This current decline in switching does not imply that consumers are getting what they want. On the contrary, satisfaction with customer service has decreased since 2009 in each of 11 characteristics measured—from having customer

Figure 2

Customer Service Characteristic Satisfaction – Global Sample

Having access to environmentally friendly options2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

Having customer service available at convenient times

Being able to access customer service using multiple channels

Being able to resolve questions/issues on my own without speaking to a service agent

The amount of time it takes to completely resolve my issues or problem

The amount of time I have to wait to be served

Having employees to are polite and friendly

Having employees who are knowledgeable and well-informed

Having customer service people who can deal with my issue without having to refer me to another person

Having customer service people who know my history based on information I have previously provided, so I don’t have to repeat myself each time I talk to someone

The amount of time it takes to read and understand information the company sends me

30% 16%

35% 18%

32% 11%

37% 17%

31% 11%

38% 16%

28% 9%

34% 13%

24% 9%

28% 10%

23% 8%

26% 13%

20% 7%

22% 10%

34% 13%

38% 23%

27% 11%

29% 19%

23% 9%

25% 16%

20% 9%

23% 15%

Satisfied Extremely satisfied

service available at convenient times to accessing service through multiple channels. [Figure 2] Additionally, consumers continue to have higher expectations for customer service. A large percentage of consumers in emerging markets report that their customer service expectations are now higher than they were five years

ago (ranging from 55% to 89% in individual countries) and even report increases in expectations compared to just one year ago. Mature market respondents also indicated greater expectations than in previous years (compared to both one and five years ago) but with smaller increases than those in emerging geographies.

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Consumers are not willing to trade off customer service, product options, or product quality in exchange for lower pricesThe 2010 Accenture Consumer Survey also found that more than half of global consumers (54 percent) are not willing to compromise on levels of customer service, product options, product quality and frequency of communications with companies in exchange for lower prices. [Figure 3] Additionally, the percentage of consumers who identified price as the reason for selecting a new provider declined from 75 percent in 2009 to 57 percent in 2010. [Figure 4]

Price trade-off- Global Sample by industry

Price as reason to select a new provider - Global Sample by industry

I am willing to accept lower levels of customer service if it ensures I get the lowest price 54%

67%

47%

44%

8%

5%

11%

17%

I am willing to accept lower levels of product options if it ensures I get the lowest price

I am willing to accept lower levels of product quality if it ensures I get the lowest price

I am willing to accept lower frequency of communications if it ensures I get the lowest price

Agree (8, 9, 10)Disagree (1, 2, 3)

Figure 3

Figure 4

UK 2010

UK 2009

USA 2010

USA 2009

Australia 2010

Australia 2009

Canada 2010

Canada 2009

Germany 2010

Germany 2009

France 2010

France 2009

Belgium

Belgium 2009

Brazil 2010

Brazil 2009

South Africa 2010

South Africa 2009

India 2010

India 2009

China 2010

China 2009

Singapore 2010

Singapore 2009

57%

74%

50%

66%

56%

75%

50%

70%

60%

83%

59%

70%

57%

77%

58%

79%

56%

78%

54%

71%

58%

80%

69%

84%

57%

2010 2009 2008

75% 68%

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Technology has helped improve the overall customer experienceConsumers report that the increased use of technology has improved their awareness of products and services as well as their experience in handling customer service issues. More than three-quarters (77 percent) of global consumers reported that the use of technology in the pre-sales phase— such as e-mail advertisements, online banners, product comparison tools and online ordering—has improved their experience when deciding to purchase a service provider’s offerings. More than two thirds (66 percent) say their growing use of technology for customer service through such chan-nels as automated phone attendant, live Internet chats and self-service options on a website has improved the level of service over the past several years. Consumers in emerging market countries rate the importance of technology even higher—both for Marketing and Sales as well as for Customer Service—than their counter-parts in mature markets. [Figure 5]

Figure 5

Experience Impact of technology - Global Sample

Strongly disagree

6% 17% 54% 23%

3% 10% 53% 34%

7% 21% 55% 17%

11% 22% 46% 20%

14% 26% 47% 13%

5% 16% 45% 34%

Technology Use in Marketing and Sales Practices

Technology Use in Customer Services Practices

Emerging Markets

Mature Markets

Global 2010

Emerging Markets

Mature Markets

Global 2010

Somewhat disagree Somewhat agree Strongly agree

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Word of mouth is still the basis for consumers’ decisionsWord of mouth remains, however, the source of information respondents use most (76 percent) and consider most important (56 percent) when deciding whether to do business with a service provider. Word of mouth extends to postings on social media sites, where one in four respondents say they trust the comments about companies and brands posted online by people they know. [Figure 6]

Figure 6

Information sources/channel - Global Sample

Trust, Influence and Use of Social Media - Global Sample

Sources used

On-premise/in-store information

Information from people I know

Corporate website

Print advertising

Online information from other sources

Online advertising

Paid advertising on TV or radio

Direct mail or telemarketing

Source importance (important & very important)

18%

24%

20%

28%

28%

39%

42%

56%

47%

37%

46%

47%

58%

62%

63%

76%

19%

26%

24%

21%

33%

20%

57%

56%

55%

52%

24%

23%

12%

28%

I tend to trust comments about companies/ brands on social media sites posted by people I know (family, friends, coworkers

I tend to trust comments about companies/ brands on social media sites posted by people I don’t know

Negative comments posted on social media sites contribute to my consideration of not buying a given product or service

Positive comments posted on social media sites contribute to my consideration of buying a given product or service

Portion of consumers that posted negative comments after having a bad customer experience

Portion of consumers that posted negative comments after having a bad Marketing and Sales experience

Disagree (1, 2, 3) Neutral (4, 5, 6, 7) Agree (8, 9, 10)

Global 2010

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Trust is an increasingly important influencer of customer behaviourThe survey also identified trust between customers and a company as a strong influencer of customer behaviour. When it comes to making the decision to switch, loss of trust has increased or stayed the same in eight out of the 10 industries—increasing significantly in consumer electronics manufacturers, consumer goods retailers and travel and tourism providers. Fewer respondents cited trust as a reason for switching banks and financial services companies (23 percent in 2009 vs. 18 percent in 2010) and life insurance providers (19 percent in 2009 vs. 13 percent in 2010) [Figure 7]. Still, only one in four respondents say they trust the compa-nies with which they do business.

Figure 7

Trust mentioned as reason for complete switching (multiple factors possible) – By Industry

Travel and tourism2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

Life Insurance Providers

Consumer Goods Retailers

Retail Banking/FS Providers

ISP

Cable/Satellite Companies

Landline Phone Companies

Wireless Phone Companies

Gas & Electric Utilities8%

17%

13%

13%

8%

8%

10%

10%

9%

15%

23%

18%

14%

17%

7%

15%

19%

13%

11%

17%

page 7

Figure 8

Trust - Global Sample by Industry

Travel and tourism2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

2010

2009

Life Insurance Providers

Consumer Goods Retailers

Retail Banking/FS Providers

ISP

Cable/Satellite Companies

Landline Phone Companies

Wireless Phone Companies

Gas & Electric Utilities

Consumer Electronics Manufacturers

Not at all (1, 2, 3) Neutral (4, 5, 6, 7) Very well (8, 9, 10)

13% 58% 29%

12% 57% 31%

20% 53% 27%

17% 51% 32%

13% 61% 26%

8% 65% 27%

14% 59% 27%

10% 63% 27%

19% 47% 34%

17% 46% 37%

19% 55% 26%

17% 52% 31%

25% 52% 24%

20% 51% 29%

24% 54% 22%

20% 51% 29%

22% 51% 27%

18% 50% 32%

29% 46% 25%

27% 47% 26%

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Over the past year, loss of trust has increased as a reason selected by respondents for deciding to switch from consumer electronics manufacturers, consumer goods retailers and travel and tourism providers.

Figure 9

Loyalty program adoption and effectiveness

Loyalty programs can help man age expectations and deliver rel evant experiencesParticipation in loyalty programs continues to be relatively low, but across the 10 industries assessed in the study, the percentage of consumers who participated in at least one loyalty program increased in 2010 as compared with 2009. For example, participation in retail loyalty programs grew from 45 percent of consumers in 2009 to 52 percent of consumers in 2010. Participation in hotel loyalty programs grew from 18 percent to 24 percent, and for wireless service providers, consumer participation grew from 19 percent to 31 percent. [Figure 9]

Similarly, the percentage of consumers who were persuaded to remain with their service providers as a result of loyalty programs increased in 2010 as compared with 2009: from 49 percent to 54 percent among retail consumers; 45 percent to 53 percent among wireless service provider consumers and 49 percent to 51 percent among hotel consumers.

Retailers

Wireless/cell phone companies

Internet service providers

Banks

Airlines

Hotels

Home telephone service providers

Utility companies

Cable/satellite television service providers

Life insurance providers

Participation (at least 1 program)

Persuasion to stick (much & very much) with the companies that provide programs

53%

49%

49%

51%

47%

51%

52%

50%

53%

54%

14%

19%

20%

24%

24%

25%

29%

29%

31%

52%

44%

41%

40%

41%

49%

43%

43%

46%

45%

49%

9%

13%

11%

14%

18%

22%

26%

18%

19%

45%

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ConclusionsThe 2010 Accenture Global Consumer Research has identified a number of telling shifts in consumer attitudes and behaviors:

Consumers are increasingly demand-ing, and many companies are not meeting expectations. The widening gap between what consumers expect and what they actually experience will likely hinder companies’ growth, especially in emerging markets.

Customers will likely act on their dissatisfaction…even if they haven’t already. Switching due to dissatisfaction remains considerable and, given growing dissatisfaction rates, current customers may well switch in the future. Additionally, consumers are influenced by a broadening set of factors when deciding to stay with or leave a provider.

Trust is emerging as a critical influencer of consumer behavior. Building trust among a company’s customer base represents a large opportunity given the small percentage of respondents who say their providers are “trustworthy”.

The “customer experience” begins before a consumer is actually a customer. Marketing and sales efforts influence whether a prospect becomes a customer and, if so, how well the company meets expectations. All consumer touchpoints should offer consistent, relevant experiences, including the post-sale customer service experiences.

One-size-fits-all customer service is insufficient. With existing customers, expectations are that companies will provide tailored, meaningful experiences to fit customers’ needs and preferences. Additionally, the “customer experience” may continue after switching occurs, influencing lapsed customers and reinforcing the premise that it is rarely too early or too late to improve the customer experience.

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About the Research The Accenture Global Consumer Survey is an annual research project that assesses consumer attitudes toward customer service and market-ing and sales practices. The 2010 survey includes online responses from more than 5,800 people in 17 countries: Australia, Belgium, Brazil, Canada, China, France, Germany, India, Ireland, Italy, Japan, Mexico, Singapore, South Africa, Spain, the United Kingdom and the United States. Respondents were asked to assess their experiences with up to four service providers in 10 industries: retail, wireless service providers, inter-net service providers, banks, airlines, hotels, home telephone service provid-ers, utility companies, cable/satellite television service providers and life insurance providers.

Lower prices are usually not sufficient to offset service and product expectations. Most consumers are not willing to trade off customer service, product options, or product quality in exchange for lower prices. In last year’s research findings, price had greater influence, which may have been impacted by the economic climate. This year, price remains a key driver but has decreased in importance compared to other factors.

Technology is an increasingly impor-tant enabler of marketing, sales and customer service. Technology has boosted consumers’ experiences, especially when prospecting and much more so in emerging than mature markets. It is imperative for companies to engage their customers in these channels to provide positive experiences and, ultimately, greater satisfaction. Importantly, these newer channels have not replaced other channels: they are additive, as consumers expect a multi-channel experience.

Social media is the catalyst for convergence of digital and mobile and is dramatically accelerating the exchange of customer opinions. Word of mouth is a critical factor impacting consumer decisions, which includes exchanges through social media. In addition to switching, dissatisfied customers have the equivalent of a megaphone through social media and digital channels to communicate their frustration to others. Companies need to make conscious decisions about their social media strategies and practices, as ignoring it is not an option.

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