Study Shows Value of Customer Service

Buyers say they'll pay a premium for a good shopping experience.

by staff writer
- Oct 20, 2010

Customer service is a big factor when buyers decide who they'll do business with—and how much they'll spend on an item, according to a new study.

In fact, 55 percent of respondents said they would pay 10 percent more for an item online if a company provided them with a good shopping experience. Ten percent said they would pay 25 percent more for a product if the seller provided quality customer service.

On the flip side, more than 80 percent of respondents said they have stopped buying from a particular retailer or merchant because of bad customer service, the study by Harris Interactive, a leading market research firm, shows.

Of those who stopped doing business with a merchant because of bad customer care, 75 percent never bought from that seller again. And many of these consumers told friends about their bad experiences inorder to discourage others from doing business with that particular company or seller.

"This year's report not only demonstrates the financial impact of a negative customer experience, but the real value of positive customer experiences," notes Greg Gianforte, chief officer of RightNow Technologies, the firm that sponsored the study. "By focusing on delivering exceptional experiences, businesses have the opportunity to grow their base, improve brand loyalty and increase overall revenue."

Merchants who provide inadequate customer service could see the effects spread, as people talk to their friends about their less-than-stellar business transaction with a company or seller. And word of mouth can be a very good, or very bad thing for sellers, as it is the No.1 influence on buyers when they decide what to buy, the study notes.

"Consumers not only voice their consumer experience preferences with their own wallets, they also influence their peers," the report notes.

So what is bad customer service? According to respondents, it includes taking too long to respond to questions or issues that arise during transactions, and dealing with staff members who aren't very familiar with an item or service. However, the top reason consumers stopped doing business with a company was rude staffing.

About the Author

Auctiva staff writers constantly monitor trends and best practices of those selling on eBay and elsewhere online. They attend relevant training seminars and trade shows and regularly discuss the market with PowerSellers and other market experts.

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