Service Beats Price for Asia-Pacific Consumers

Consumers living in the Pacific Rim are more concerned with good customer service than lower prices.

That’s according to a new study conducted by Ipsos on behalf of business analytics company Verint Systems. Researchers polled more than 5,800 consumers across China, Hong Kong, India, Japan, Australia and Indonesia and found that the majority have come across poor customer service at some point.

Telecommunication companies were particularly notorious for poor customer service in Asia, with 64 percent of respondents saying they had experienced poor customer service. Those polled recounted bad experiences at retail stores (59 percent) and financial services, utilities and travel companies (51 percent).

Analysts said expectations for quality experiences are relatively low in Asia, presenting an opportunity for companies to stand out from the crowd with a strong focus on a quality customer experience. Consumers in the region were found to value customer service higher than price, perhaps because it is not automatically seen as a guarantee.

Roughly 45 percent of respondents said they’d be willing to pay higher prices to get better customer service. Consumers in China and India were particularly keen on paying a premium for better service. Just 23 percent of respondents survey-wide said they valued low prices over other factors.

Analysts said they were somewhat surprised by their findings, as they challenge the perception that “price is king” in emerging markets. Companies with that perception have, in the past, valued the price of their products over all else.

Key customer service problems include waiting too long for a solution to a problem (cited by 21 percent of people) and staff that lacked the knowledge to be of assistance (20 percent).

Both issues can often be solved by implementing improved customer contact technologies, ensuring representatives always have the right information on hand to answer questions quickly and accurately.

The benefits of good customer service are also likely to spread quickly and have further-reaching impacts than just the loyalty of individual customers. Verint’s study found consumers in Asia-Pacific frequently share their experiences with a company and do so via multiple channels.

More consumers also expressed the desire to share positive experiences than negative ones. Some 41 percent said they would spread the word about good service, compared with 32 percent who experienced bad service.

It is also not just direct family and friends with whom these individuals speak. Increased use of social networking means word about the quality of a business’ service will get around and reach a large audience very quickly.

Roughly 53 percent of consumers said they turn to social channels such as Facebook, Twitter and personal blogs. And in a region that has such low expectations, companies that exceed these low expectations stand to reap the benefits of a better reputation.

“Companies that can proactively deliver a superior customer experience by listening and acting on the voice of the customer can gain competitive advantage in the market,” said Ady Meretz, president of Asia-Pacific at Verint.

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