Opinion: customer service hardly matters anymore

Felicity Hannah wonders whether customers care about service anymore, or if it’s all about price…

Do you care about customer service or do you simply look for the cheapest price?

It’s an interesting question because many companies focus on their customer service, UK call centres and satisfaction pledges as a way of enticing and then retaining customers.

Yet in the current economic fug we seem to be in – thanks to stagnant wages and inflation at a painful 3% - seems to be driving customers more towards bargain prices than superb service.

Just last week, for example, Aldi was rated the country’s best supermarket, knocking Waitrose down to fourth place.

And it’s not the customer experience leaving customers so enthusiastic about their new favourite supermarket.

In fact, the survey, carried out by consumer champion Which?, showed that customers thought Aldi shops were untidy and that there weren’t enough staff.

For them, it was all about price and the quality of the fresh food.

Alex Neill, managing director of Which? home products and services, says: “With food costs rising it seems as though shoppers have felt the pinch and are voting with their feet and wallets.

"Aldi and Lidl have won over their customers with value for money, knocking Waitrose off the top spot.”

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So have we really become so price-obsessed that we simply don’t care how unendurably bad the customer service is?

What matters more?

If you were looking for a new mortgage, how would you go about it? You would look at the best-buy tables, add up the numbers, check out the fees and make a decision based on maths.

You’d be very unlikely to search the internet for the mortgage company that has the best customer service record, especially if you assume you won’t need to deal with them much.

So I have been genuinely curious about whether we’ve simply stopped caring about customer service in our quest for the best deal.

I started to wonder if it could be considered the Ryan Air-ising of everything; that we’re so focused on finding the cheapest price that we will endure almost any discomfort to get it.

Yet, while price might be a huge factor in getting us to sign up, statistics suggest that poor customer treatment is a common reason for switching away again.

A survey carried out by customer service specialists Echo Managed Services showed that, while price was the number one deciding factor for customers when they picked a new service provider, one in three would switch suppliers solely as a protest against poor customer service.

That analysis was supported by what several consumer affairs commentators told us.

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Price first, service later

Himmat Dhanda, founder of ‘athleisurewear’ brand www.Sculptmode.com, agrees that price is at the front of people’s minds when they’re comparing deals.

“Both inflation and wages having remained stationary for a long time has resulted most certainly in an economy searching for bargains wherever they can.

"This, in turn, leads to many companies using whatever means possible to lower their own costs which usually includes their customer service dropping significantly in quality.

“What may help them in the short run using these corner-cutting techniques almost certainly won't do too much good for their sales as customers notice and react accordingly.”

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Perhaps it is more about the information that is available. If the comparison tables simply offer prices then the cheapest offer looks the best. But if there are online reviews of the service easily accessible then that may well drive a customer’s decision.

James Brown, partner and head of the UK consumer and retail at pricing consultancy Simon-Kucher, says it really depends on the product or service being bought as to what is considered the most important factor.

“That said, lower priced versions of the same product will always rise to the top of the search results and draw more attention.

“When it comes to the purchase decision, retailer reputation, delivery flexibility, aftercare etc. all come in to play.

“Think about the last time you bought something on Amazon… you probably look not just at the price, but how quick delivery will be and the seller’s reputation if a 3rd party. For some people though, they will trade off all of those things for the lowest price. “

When price comparison goes wrong

Accepting that the customer service might be a bit shoddy is one thing, but sometimes, our focus on price can mean we don’t get the product or service we need.

For example, when you’re looking for a new insurance policy you don’t want the cheapest one; you want the best price for the right cover.

There’s no point saving a few pounds on your car insurance if it means you don’t get the courtesy car, legal protection or low excess that you need when you come to claim.

Vix Leyton, of the website Broadbandchoices.co.uk, agrees that the focus on price can cause problems for customers further down the line.

She says: “I feel like the phrase ‘price comparison’ needs a rebrand, particularly as comparison has become so popular across increasingly complicated financial service offerings.

“For broadband for example, you really should be doing your homework on the sort of speeds and extras you need before you step anywhere near a site as there is such a vast difference between budget and premium, and so much nuance.

“I think a lot of people do buy on price and repent at leisure.

Similarly with mobile phone contracts, some people get so blindsided by the notion of a ‘free handset’ up front that they just don’t look at the long-term implication, which ultimately is paying off the collateral of the phone over time and risking massively overpaying the day their contracted term ends.”

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If we do now value a low price over customer service, it’s important that price doesn’t become the only focus, or there’s a risk we’ll lose out in the longer term.

What do you think? Do you consider customer service when looking for your next deal or is price the main concern? Have your say using the comments below.