Consumer Forum

The Customer Service Klaxon

OK, so it’s not rocket science to work out that some of the factors that combine to deliver decent customer service are suffering as the economy struggles to stabilise. How easy is it, for example, for businesses to provide a sense of good value for money when overheads are rising and their margins being squeezed? How can staff go the extra mile if they are already being asked to do the work of two people?

Perhaps this is where the no-frills operators are best placed for ‘business as usual’ with consumers accepting that ‘you get what you pay for’ and so will happily sacrifice service for the sake of austerity? However most businesses ARE frills-based and – let’s face it – it’s going to take more than a double-dip recession to persuade most UK consumers to give up all their creature comforts.

With this in mind, new research that Make It Cheaper has just carried out with the Centre for Economic & Business Research sets off the klaxon for customer service standards. It show that rising business costs have forced classic service sectors – such as restaurants, bars and shops – to reduce staff by as much as 34%. And neither have we turned the corner… with 20% of businesses planning further staff cuts over the next 12 months and over half about to put up prices again. Hospitality and retail again top the tables.

We already know that consumers have become more price-sensitive, more likely to shop around, but is this dangerous mixture of circumstances going to make them more service-sensitive as well? Quite possibly… and quite reasonably too.  We see a version of it in our own call centre with businesses calling us for business gas and business electricity prices, not just because they are cheaper but because they don’t want to spend all day navigating IVR systems and listening to hold music.

So what measures can be taken to make sure customers are not tempted to shop around among your competitors? Firstly alleviate the predictable pressure on margins by cutting-out waste and unnecessary overhead costs. Every pound saved translates into a pound of profit made, without having to go looking for any extra revenue. Secondly, simply place a greater emphasis on customer service than any of your rivals. And, if you fear a drop in standards, exchange some goodwill with your customers by explaining to them why it’s happening and that their loyalty in a time of crisis will pay dividends in the long term.

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