U.S. Consumers Reward Companies with Good Customer Service

It seems like a no-brainer: provide better customer service and consumers are likely to spend more money with your company than they are with competitors.

It turns out there’s research to support this assumption. In the latest American Express Global Customer Service Barometer, seven in 10 Americans are willing to spend an average of 13 percent more with companies they believe provide excellent customer service. These figures are up from 2010, when six in 10 Americans said they would spent an average of 9 percent more for great service.

And yet, consumers don’t think companies are doing all they can to improve customer service. Six in 10 Americans believe businesses haven’t increased their focus on providing good service—up from 55 percent in 2010—with 26 percent of this group thinking companies are paying even less attention to this business-performance category. Two in five (42 percent) say companies are helpful but don't do anything extra to keep their business. One in five (22 percent) thinks companies take their business for granted.

Even more compelling, American respondents say they tell an average of nine people about good experiences, but if a transaction goes bad, 16 people hear about it.

“Getting service right is more than just a nice-to-do; it's a must-do,” says Jim Bush, executive vice president of world service for American Express. “American consumers are willing to spend more with companies that provide outstanding service, and they will also tell twice as many people about bad service than they will about good service.”

Additional findings from the research are:

• 81 percent of American consumers agree that smaller companies place greater emphases on customer service than large businesses
• 78 percent have not made an intended purchase because of a poor service experience
• 59 percent say they would try a new brand or company for a better service experience
• Customers who have fantastic service experiences say friendly representatives (65 percent) who are ultimately able to solve their concerns (66 percent) are most influential
• 56 percent admit to having lost their tempers with customer service professionals, with consumers aged 30 to 49 being the most frequently angered (61 percent), compared to 54 percent of those aged 18 to 29, who say they've never lost their tempers with service professionals
• Once angry, 74 percent speak to supervisors, 44 percent hang up, and 39 percent threaten to switch to competitors.

The survey included responses from nine other countries around the world. International consumers also are willing to spend more with companies they believe provide excellent service—with the average greater amount they are willing to spend ranging from seven percent (the Netherlands) to 22 percent (India).

“There are many who subscribe to the convention that service is a business cost, but our data demonstrates that superior service is an investment that can help drive business growth,” Bush says. “Investing in quality talent, and ensuring [employees] have the skills, training, and tools that enable them to empathize and actively listen to customers are central to providing consistently excellent service experiences. Ultimately, great service can drive sales and customer loyalty.”