Customer service strategy more important in emerging markets

By Barney Beal, News Director

01 Dec 2009 | SearchCRM.com

Hoping to turn to emerging markets to turn around your business in the recession? Better make sure you have a sound customer service strategy in place.

Customers in emerging markets can be more sensitive to customer service than their counterparts in mature markets, according to the results of a recent survey by Accenture.

The survey, conducted over the summer, found that 87% of consumers in emerging markets switched providers in at least one industry sector because of poor service in the past year. That's 18% more than the global average. And, the survey suggests, they're not hesitant to tell others about their experiences -- 69% tell their acquaintances about bad experiences and 25% use social media to spread the word. In emerging markets, 40% of consumers said they use blogs and other online media to tell others about their negative experiences.

What’s more, customers in emerging markets seem to have more bad experiences to share. Among respondents in emerging markets, 68% said companies "sometimes, rarely or never" met their expectations, compared with 56% in mature markets.

For the survey, emerging markets included India, Brazil, China and South Africa. Mature markets included Australia, Canada, France, the U.K., Germany, Belgium and the United States. The online survey was completed by more than 5,000 consumers.

Customer service technology is playing a bigger role in emerging markets than it does in established markets.

"The emerging markets are saying technology is improving service, and they're more apt to report on that service and tell others how they perceive companies," said Chris Allen, managing director, Accenture CRM Service Transformation practice. "Established markets tend to point to tech as not being as influential in improving customer service."

It's therefore important for companies entering emerging markets to provide multiple channels for customers and to track satisfaction or dissatisfaction, Allen said.

The survey results also found that:

• 52% of emerging market consumers use the Internet to search for help vs. 44% of mature market consumers.
• 49% of emerging market consumers surf corporate websites vs. 40% of mature market consumers.
• 35% of emerging market consumers engage in online chats vs. 15% of mature market consumers.
• 14% of emerging market consumers use text messaging to seek assistance vs. 3% of mature market consumers.

Customer service an issue for all

Of course, it's not just emerging markets where customer service is an issue -- and creating customer churn. In many ways, customers are simply harder to satisfy.

"Generally, there's a perception that service is getting better and companies are improving, yet most customers are reporting they're less pleased with service providers," Allen said. "There's this perception that service is better but they're drawing the short end of the stick."

Need proof that today's consumers all over the world are a fickle lot? In an open-ended survey question asking respondents to list companies that deliver excellent customer service and those that deliver substandard, 50% of the top responses appeared on both lists.

In fact, despite the recession, customer service remained the No. 1 reason consumers cited for switching vendors.

Truly engaging and satisfying customers requires differentiation, according to Allen.

"There is no one-size-fits-all service model," he said. "It's really impossible to do that. The next generation of services is going to be more around creating differentiated customer experience and tailored customer experience based on customer preferences."

Still, emerging markets do offer growth opportunities. Nearly two-thirds of respondents in emerging markets expressed an interest in trying goods and services produced in other countries, roughly the same number who said they did not care where a product was produced.

"Certainly, companies need to realize that channels are more important in emerging markets as far as interacting with those customers and tracking their satisfaction," Allen said. "In general, though, the differentiated service expectation is every bit as high a priority. Using technology to deliver those experiences is really the opportunity."