Why Social Media Savvy Companies Can Charge More
If you provide great customer service via social media, you may be able to charge more, suggests a new survey.
A small but very vocal minority of consumers use social media to get customer service–but they wield disproportionate influence, according to American Express' third Global Customer Service Barometer.
One in five customers (17 percent) have used social media at least once in the past year for help with service. But what distinguishes this group is that it speaks up online about brands they use, and are extremely loyal to ones they like. How loyal? They're will to pay a 21 percent premium on brands that deliver great service–compared to the 11 percent premium for service those who don't use social media would pay.
Perhaps more significantly, social media-savvy users who receive great service have a potentially huge reach: They trumpet their positive experience to an average of 42 people, as opposed to the nine people told by those who don't rely on social media for service.
The bad news: These social media users can be even more vocal if they think you've wronged them. More than 4 in 5 social media users have not completed an intended purchase because of poor customer service. It doesn't end there: They'll tell of the experience to an average of 53 people (so yes, on average more people will find out if a customer is unhappy with service as opposed to delighted). Just under half (49 percent) of those not active on social networks won't finish a purchase, and they will tell an average of 17 people of their dissatisfaction.
Those who seek service through social media think companies are getting better at it: Sixty percent said firms had improved their response times to appeals through social networks over the past year.
The survey also showed the top five reasons why customers turn to social media to communicate with a company. Top on the list, of course, was to get a response from the company abut a service issue. This was followed by praising a company for great service, sharing information about a service experience, venting about poor customer service and liaising with others about how to receive better customer experience.
Social media is just one piece of customer service, of course. The most popular way to get help was speaking to a live representative, either on the phone or face-to-face, the survey said, or via a company website or e-mail.
Other findings: Customers are very disappointed with customer service in general these days. A whopping 93 percent of Americans say companies fail to exceed their customer service expectations, whether online or off. More than half of respondents (55 percent) had walked away from an intended purchase in the past year because of a crummy customer service experience. By far the biggest gripe: Rudeness, followed by being shuffled around with still no resolution of the issue.
One simple way to avoid irritating customers: Try setting a clock. The average U.S. customer will spend 13 minutes on hold before slamming down the receiver in frustration. In person, you get slightly less time: Customers will wait an average of 12 minutes in a restaurant, bank or retail store before reaching boiling point.
What has been your experience providing customer service via social media?
Image by OPEN Forum