Avoidable customer churn costs British businesses GBP25 billion

Electricity, insurance, gas and broadband suppliers top the CallMiner Index

Empathy in call centres is key to loyalty success

ID: 1540482
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(businesspress24) - London, United Kingdom, 3rd September 2018. New research released today by CallMiner, the leading platform provider of award-winning speech and customer engagement analytics, reveals that British businesses are driving customers away for completely avoidable reasons. And it''s costing them billions. In fact, a conservative estimate of the price of switching is GBP25.05 billion per annum[1].

The report features survey responses[2] from 1000 UK adults who had contacted a supplier in the last 12 months. Entitled the CallMiner Index, the report shows that 84% of adults switched suppliers 1.91 times in the last 12 months. The sectors that top the CallMiner Index over the last five years and the last 12 months, are: https://www.realwire.com/releases/Avoidable-customer-churn-costs-British-businesses-25-billion

The same four sectors top the Index over five years. In the last 12 months Insurance and broadband have changed places with Insurance moving from #4 over five years to #2.

The pace of switching is accelerating
The CallMiner Index reveals that the average switching rate over five years is 0.68 times per annum. The rate for the last 12 months is almost three times higher at 1.91 times. Insurance is the only one of the big switching sectors that has an above average switching rate over five years of 0.76 times per annum.

The main reasons for churn - falling foul of the Brits'' sense of
The survey uncovered that consumers want to stay loyal but are ''forced'' to switch because of suppliers'' practices. For example, 23% say they are planning to switch electric suppliers but 29% did so this year. The main actions by suppliers that force people say goodbye are as follows:
1. Prices are too high or have increased (71%)
2. There is no reward for contract renewal i.e. no reward for loyalty (45%)
3. Discounts offered to new customers are not automatically applied to your account (39%)
4. Feeling like you are not being treated fairly (31%)

5. There is a serious problem with the product or service (21%)

After price - which is an inevitable reason to change - the next three on the list are all related to being treated unfairly. Not only is this counter to the famous British sense of fair play, but neuroscientists tell us it also falls foul of a primary need that is hardwired into our brains - being fairly treated. Amy Brann, a leading neuroscience expert at Synaptic Potential, explains: "Being unfairly treated triggers a response in similar networks of the brain that controls physical pain. The reaction can genuinely hurt! That"

Unsurprisingly, the advice consumers provide on how to keep them loyal matches the top three reasons for switching. However, the strength of feeling is indicated by the fact that more people provide this advice than those that switched for the same reason: keep prices the same or better than for new customers (81% v 71%); reward them for renewing their contract (68% v 45%) and automatically apply new discounts to their existing account (64% v 39%).

Frank Sherlock, Vice President for the UK at CallMiner, said: "With 84% of people switching in the last year, churn has reached epidemic proportions. And three of the top four reasons all relate to fairness. Treating people unfairly is completely avoidable. Suppliers could slash their churn rates if they listened to what consumers are saying in this research and put treating customers fairly at the heart of their brand values."

[1] According to the Office of National Statistics there are 52,078,525 adults in the UK. A conservative estimate of the cost of acquiring a new customer across all the main sectors in the survey is GBP300 per person. This is based on the level of incentives applied to attract new customers and a conservative estimate of associated sales and marketing costs. The CallMiner Index identified that in the last 12 months 84% of adults have switched 1.91 times. This represents 43.745 million people. The total cost of churn is therefore at least GBP25.05 billion.

[2] The research was carried out for CallMiner by 3Gem Research & Insights. 1,000 UK adults responded to an online survey in May 2018.

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callminer, callminer-index, insurance, gas, broadband, electricity,

Company information / Profile:

CallMiner believes that resolution is the fundamental driver of positive customer experiences. When contact centre agents and others responsible for customer engagement are empowered by insight and feedback in near real-time, they can dramatically improve the rate of positive outcomes. With the tagline "Listen to Your Customers, Improve Your Business" our goal is to help companies automate the overwhelming process of extracting insight from phone calls, chats, emails and social media to dramatically improve customer service and sales, reduce the cost of service delivery, mitigate risk, and identify areas for process and product improvement. Highlighted by multiple customer achievement awards, including seven Speech Technology implementation awards in the past five years, CallMiner customers have been recognised for unparalleled success in leveraging Eureka interaction analytics to attain their business goals and objectives. http://www.callminer.com.

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Crispin Manners
Onva Consulting
0208 224 79 73

published by: RealWire
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Date: 09/03/2018 - 07:53
Language: English
News-ID 1540482
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