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Bad Customer Service: The Single Most Important Reason Why Customers Leave

Updated on July 10, 2014
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I'm a dad, husband, and Christian first. Second, I'm an educator & organizational development professional.

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Roster of Best and worst companies when it comes to customer service

Did you contribute to the top reason why customers leave? Or are you one of those unfortunate souls that had to contend with repulsive service? Or are you both? Don’t worry nobody’s judging – we all wish!

The truth is the customer-employee relationship is wrought with a plethora of encounters both good and bad. But everyone always hopes for the best. Unfortunately, this is not the case. Recent studies show that customers leave for a myriad of reasons. But the single most important reason why customers leave is poor customer experience.

By now, everybody has been bombarded with words like customer satisfaction, excellent customer service and some other permutation and synonyms. But it all boils down to one thing: Are the customers happy? So ask yourself, when was the last time you were dumbfounded for a service well done? Yes, it’s been a while, I know.

Startling Stats

Harris Interactive said that as much as 86% of customers leave due to pathetic customer service. Of course it was not stated in those words, but it fairly captures the essence. RightNow Technologies puts the number at 73% while the Rockefeller Corporation pegged it at 68%. OK, it’s obvious that the numbers differ and a variance of more than 10 is big. But all these studies point to one important fact: CUSTOMER SERVICE IS IMPORTANT TO RETAIN CLIENTS. As a corollary to this, if clients leave, business fumbles.

With all the hype on customer service one would think companies – big or small, would actually take heed. In 2009 Peppers and Rogers Group said that 81% of companies providing excellent customer service outperformed their competitors. That’s how important customer service is in the industry. However, it’s so sad to even contemplate that a huge chunk of one’s business leave because of how they treat their clients. The impact of this is without question grave!

Apart from the lost business, dissatisfied clients are the most reliable source to dissuade others from patronizing a product or service. I’m not talking about huge groups and non-profit organizations rallying against a product or process. But rather, these are the average consumers on the street willing to spread the word of their disdain. Just to put this in perspective, the White House Consumer Affairs said that 13% of unhappy customers will usually tell 20 other people about their dismal experience. Imagine, 20 more people learning about your customer service fail. That’s bad for business, just wait until it gets online. You’ll surely be in deep sshhhh…shattered trouble.

Breaking it down

RightNow Technologies even went further by breaking down why customers leave. Out of the consumers who packed their bags, 73% stop doing business due to rude staff, 51% due to incompetent staff and 55% said their issues were not resolved in a timely manner. Looking at these statistics, one can’t help notice that the reasons for leaving can be remedied with trainings and some tweaks on the customer service process.

In fact the study also showed that 92% are willing to go back if they simply received an apology from the company, given a discount and if they see improvements in customer service. Come on, consumers are giving companies a chance to redeem themselves! So what do they do? They get automated response systems in the guise of better customer service (and cutting down costs). Here’s the reality of things nobody wants to talk to a pre-recorded response when dong business. USA Today even said that 90% of financial service consumers did not like Interactive Voice Response systems.

Just ask yourself when was the last time you were prompted to press a particular number just to reach a department. After which you press another series of numbers to get to the person you want to talk to. After all the effort you’re put on hold only to get someone else telling you the person is “unavailable at the moment”. Let’s face it the effort is not worth it! It irritates me just writing about it.

Furthermore, Penn-Olsen said that on the average people are put on hold for 57 seconds. Lucky for these people! Some wait for as long as 30 minutes where I come from. Yes, we do wait. What’s incongruent is that companies spend more than 90% of their marketing budget to get people to call but spend only 6% to train their people to handle these calls. People will stay on the line if they hear something relevant to them. 68% of callers will do this! However, 34% of customers who hanged up will NEVER CALL AGAIN. That’s the scary truth of it.

From hated selling strategies to actual pathetic customer service processes, consumers always find faults in the system. More than just a ploy to put down a company, it must be seen as an opportunity to improve. The company may not put customer service as a priority, but you can start building excellent customer relationships yourself. It may go unnoticed in your organization but the rewards will truly be profound.

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