Where Are Customers In 2022?

According to Liezel Jonkheid, Director and Founder of the Consumer Psychology Lab, business and customer service models are not evolving for the new post-pandemic operating environment and much higher customer expectations.

Two years into a black swan pandemic event and the world in which business and consumers engage has radically changed. At the start of the pandemic, tremendous agility and resilience was required to deploy work-from-home and remote working models, as was the quick adoption of online sales and omni-channel customer service. The pandemic brought rapid and profound disruption of legacy business models across many industries. The ability to remain accessible, functional, relevant and desirable to customers were critical survival tools for every business.

The pressure to adjust in 2020 was immense but there was also tremendous goodwill even when things did go wrong, that we were ‘in this together’.  In a ‘Voice-of-the-Customer’ programme managed by the Consumer Psychology Lab, we saw how customers appreciated the efforts and displayed high levels of forgiveness and empathy when everything did not go according to plan during 2020. At the time, service design blossomed with the crafting of new ways to meet customers’ needs in incredibly challenging and uncertain times.

Fast-forward 24 months, and the statistics show that the new ways of work and service delivery have become well-entrenched, and the tolerance that consumers had in the early months of the pandemic for less-than-ideal customer service delivery has worn thin.  Customer expectations are now higher than ever, with poor service delivery evoking strong, often borderline hostile and rude responses.

Many studies currently delve into the phenomenon of why so many consumers are behaving badly.  One could argue that two years of uncertainty, lockdowns, social distancing, personal upheaval, job losses, deteriorating mental health and economic mayhem are taking their toll on the consumer psyche, with many responses to service issues being over-the-top angry.  The risk though, is that it would be easy to justify such angry responses as simply a consumer behaving badly, rather than the result of a service delivery failure that pushes an already strained customer over the edge.

It would be remiss for any business not to take serious heed of the changed dynamic in the post-Covid recovery.  Yes, some customers do behave badly and reactions may be OTT, but these remain the exception and not the rule. What is not the exception is that customer expectations have risen dramatically, and along with it, intolerance of a less than satisfactory customer experience. Businesses need to look critically at whether service delivery has kept pace with the changed dynamics of the last two years. Where it no longer stacks up, business leaders need to ask whether the business and service delivery responses since the onset of the pandemic have evolved to meet customers where they are now. Have customers moved on at a much faster pace than most brands and businesses have?

Rapid digitisation has amplified customer expectations of all industries and service and product providers.  They no longer simply compare service delivery between comparable industries or businesses, but expect the same instant service and gratification that they get from their online banks from their insurer, their telecoms provider, restaurant and retailer. For example, customers expect an ‘Amazon end-to-end experience’ for ALL online purchasing, from any brand, in any industry – the fact that your brand has only been offering online shopping as a recent development is irrelevant to your customer.

So where are customers in 2022?

Rising customer expectations, intolerance of poor service and overtly angry consumer behaviour are just one side of the coin. The flip side shows that companies have been slow to adjust to the new normal, and that there was an expectation that things would somehow return to the way they were before.  This has not happened. Nor will it.

Two years into the pandemic disruption, service delivery has been impacted significantly and is declining. From a customer experience (CX) perspective, customer behaviour is prompted by expectations and experience in the transactional engagement, as well as the end-to-end journey. Displays of over-the-top customer anger and ire can clearly not be ignited without a match. So what role is service delivery and design playing in the response from companies since the pandemic created such havoc? Consider the following staggering statistics:

– 63% of consumers said companies need to get better at listening to their feedback.
– 62% of consumers said that businesses need to care more about them.
– 60% of consumers would buy more if businesses treated them better. Further information.

Poor customer service threatens $4.7 trillion in annual revenue globally as companies struggle to retain staff.
– 80% of customers say they have had poor customer service.
– 43% said customer service must be improved. Further information. 

– 85% of customers are willing to switch brands because of a bad customer service experience.
– 79% of customers are willing to switch brands as they know another company will give them better service.
– 67% would leave due to rudeness or apathy from a company or employee.
– 63% would leave because they couldn’t connect with someone from support.
– 62% would leave because they received inconsistent information.
– 57% would leave because of long hold/wait times when trying to reach out to a brand or company.
– 53% would leave because of slow response times to emails or messages.
– 43% would leave because no self-service options were provided. Further information.

In our own research work at the Consumer Psychology Lab, 1% of 2168 customers interviewed since Jan 2021 to date about their experience with a brand, said they will not buy the brand again and 1,3% will not return to the business unit. On the face of it 1% may not seem alarming, but when the impact is considered materially in a luxury niche brand category as just one example, a conservative value of potential loss is estimated at around R15 million.

Service delivery and the processes supporting the changing landscape have not been reviewed nor adjusted during the past year. The great motivating disruption that the pandemic brought with it in 2020 has died down, and complacency is again settling in.  Customers and their expectations on the other hand, are anything but complacent or static.

The ‘Covid excuse’ of inadequate staff levels, system inefficiencies, long waiting times, low stock levels, poorly trained staff are simply no longer tolerable or acceptable two years in.  Consider how many times you call into a contact centre now and still get fed a message about how service levels are being impacted by reduced staff and that you should be patient. Consider the withdrawal of simple courtesies like a refreshment being served to a customer while waiting at a vehicle service centre, and which has yet to be reinstated. Many companies are considering permanent hybrid working models for staff, citing productivity gains and savings on expensive floorspace, and how these will presumably translate into greater cost and operational efficiencies for customers in the long run. They may very well not be.

The simple reality is that two years have passed since March 2020, and service delivery has not improved. And here’s why: any historical data your business has on its customers is exactly that, history. We are now dealing with a world and customer data and insights that are sharply divided into pre- and post-COVID times. There is an overwhelming need to regain the focus on the fundamentals of great CX in the current and future environment, as an antidote to the angry customer:

·Know your customers – Who are your customers now, and how have they changed during the past two years? New insights are needed to direct the way forward and what to focus on.

· Experience expectations are now transferred across all industries – digitisation and more self-service channels have become a reality for consumers. Distribution channels have matured. Consumers now expect every online grocery purchase to be delivered same day, or within the hour with easy, hassle-free service recovery. Does this apply in your business too? What else have customers transferred from other industries into new expectations from your business?

· Review the current customer journey – Review the customer journey with fresh insights from customer feedback, enhanced with current trends in other industries. Re-assess each touchpoint and undertake channel reviews and tests from a customer’s perspective to identify glaring gaps and inconsistencies. Review messaging throughout all touchpoints for relevance.

· Empower staff – don’t assume that everyone knows what is required of them. Disempowered staff become disengaged and interact with customers without empathy and care, igniting over-reaction by customers who do not feel heard.

· Service design is not a once-off or static process – review and redesign process, protocols and procedures in line with changes and challenges in the business, and ensure all staff understand the service designed around the critical touch points. Service blueprints are essential when implementing new processes and protocols across the entire value chain of service delivery.

· Listen to customer feedback – There is no need to wait for a ‘Voice of the Customer’ programme to identify where customer pain points emerge (although it is one of the best sources for this purpose). Ensure that staff have a channel to share their observations around what customers struggle with and take action on critical pathways. In addition, as new business practices are implemented, take time to ‘be a customer’ by stepping into the shoes of who is buying your products – using all senses for the assessments – what does it feel like, what you are thinking, what the company says and responds and so on. Be your customer for a day. Furthermore, empower staff with the skills to manage angry customers with a supportive framework and more management involvement in resolving volatile situations. Do not remain in perpetual ‘fix it’ mode.

· Measure and track – Measure the impact of any changes made to align with customer expectations, experience of service delivery and changes to service design. These include tracking business measures alongside customer experience measures. These include lost and new customers (churn), volume and speed of returns/refunds, staff retention, number of and success metrics for innovations and improvements, first-time resolutions, CX training initiatives and so on.  Should the volume of ‘angry customers’ reveal the same trend as noted in this article, the number of investigations and material cost to the business should also be included in the metrics.

The age-old saying of a problem always has two sides holds true.  Take another look at the past two years, and how your business had to change, adjust and reposition. Customers will always challenge your business. Traditional statistics and approaches can no longer be amplified to the present situation and customer psyche, as we are dealing with a completely new phenomenon, unprecedented in scope and nature. The full and long-term impact of the last two years is still unfolding before us and will continue to do so for many months, if not years, which is why you simply cannot approach service design as a once-off process.  There must be a readiness to restructure with a more customer-centric, empathetic, forward-looking approach that is hyper-aware of your customer’s changed realities, rather than retrospective analysis of the last two years.  It is time to dump the pandemic excuses and get your customers back to loving doing business with you again.