High-quality customer service is consistently highlighted as a critical factor in determining overall consumer satisfaction with a product or service. Customers appreciate responsive, helpful and knowledgeable support from businesses.
So, how do consumers today view the American business customer experience?
Forrester Research Inc., in its 2024 annual Customer Experience Index, reveals that perceptions of customer experience dropped for an unprecedented third year in a row and are now at their lowest point since the inception of the CX Index, including along all three dimensions — effectiveness, ease and emotion — of consumer experience quality.
For example, an unprecedented 39 percent of brands significantly declined in 2024, compared to 17 percent in 2023, with the average decline in 2024 being 3.9 percent compared to the previous record average decline of 3.6 percent in 2023.
Moreover, the average effectiveness of customer experiences fell by 4 percent (to 64 percent); the average ease fell by 3 percent (to 66 percent); and brands also struggled to connect emotionally.
There are specific customer service indices crucial for a company’s economic success. For example, 93 percent of customers report that they are more likely to make repeat purchases with companies that offer excellent customer service — yet, 59 percent of customers will abandon a brand after a single poor performance.
How important is it that businesses retain customers? Acquiring a new customer can cost five times more than retaining existing customer, and it takes 12 positive customer experiences to offset one unresolved negative customer experience.
Furthermore, it is estimated that 80 percent of a company’s future profits will be generated from 20 percent of its existing customer base. Also, increasing customer retention by 5 percent can increase firm profits by from 25 percent to 95 percent annually.
Companies that excel in customer service are likely to experience growth of 4 percent to 8 percent above their industry market average.
Customer satisfaction rates across channels indicate that 5 percent of customers use self-service; 5 percent social media; 15 percent email support; 30 percent live chat; and 45 percent telephone support. Interestingly, 90 percent of customers have an expectation of a consistent experience across all channels, including online, mobile and in-person interactions.
Moreover, 64 percent of consumers expect companies to respond to their inquiries in real-time, and 76 percent of customers become frustrated when companies fail to offer personalized interactions. Regarding millennials, 60 percent expect a consistent experience from brands whether online, in-store or via telephone. The telephone remains a top channel for customer service, and this is especially true for complex issues that the customer needs solved in real-time. With advances in AI technologies, it can now bring all the benefits of AI agents to the voice channel to help solve customers’ complex issues.
It is expected that 85 percent of all customer interactions are projected to be managed without a human agent by 2025, with 75 percent of customers expecting AI-powered tools to improve their experience by providing faster responses. Yet, there is a “dark side” to this reliance — or over reliance — on AI technologies that attempt to address customer issues. While 64 percent of consumers report they prefer AI-driven instant messaging to phone support for simple questions, this definition of “simple questions” appears to be expanding. When it comes to phone service as a mechanism for solving these customers’ issues, the expanded usage of AI-powered tools on the front end of the customer telephone service experience is becoming more of a frustration for the customer and less effective of a method for customer issue resolution.
In other words, the AI-powered tools are becoming more of a barrier — or digital labyrinth — for customers readily accessing a human agent for what they already know is a complex issue that needs resolution.
What companies need to know about their customers’ service experience is that 78 percent of customers say that getting their issue resolved quickly is the most important factor in a positive customer experience.
An example of a company that consistently scores near or at the top of surveys measuring positive customer experience is the financial services firm USAA. In KPMG’s 2024 survey of 10,000 U.S. consumers commenting about 316 brands’ execution across six pillars — integrity, resolution, setting customer expectations, time and effort, personalization and empathy for best customer experience — USAA is the No. 1 provider of stellar customer experiences.
What is a key factor in KPMG’s USAA survey result? USAA intelligently uses AI-powered tools in its initial contact with a customer, but allows telephone customers to seamlessly access a human agent to resolve their complex issues. Other companies, please take note.
