All of those people complaining about their cable, Internet and wireless providers are not alone. TV and Internet service providers lead the list of companies with whom U.S. consumers say they’ve had a bad experience with, followed by wireless carriers.
According to new research from customer experience consultant Temkin Group (which surveyed 10,000 U.S. consumers about 269 companies in 19 industries), 16% of consumers said they had a poor experience with a TV or Internet provider within the past six months. Moreover, Time Warner and Comcast were among the top five companies with the most customers reporting bad experiences (25% and 21%, respectively).
“Internet and TV service providers have historically owned local monopolies, with limited or no real competition in their local markets,” Bruce Temkin, the firm’s managing partner, tells Marketing Daily. “As that has changed, these organizations have focused efforts on grabbing customers and locking them into contracts. So they have not really been focussed on making their existing customers happy. As competition increases in those industries, companies will need to be better at delivery good experiences and recovering quickly from bad ones.”
Those bad experiences can be costly. According to the research, more than one-quarter of consumers who said they’ve had a bad experience stop spending with computer makers, car rental agencies, credit card issues, hotel chains and software companies. It’s notable, however, that fewer than 15% of customers of TV and Internet service providers and wireless carriers stopped spending because of a bad experience.
The difference, Temkin says, may be all about competition. “Options matter when it comes to how consumers respond to a bad experience,” he says. “The more options that consumers believe that they have (including not spending in the category at all), the more that a good or bad experience will affect their spending.”
One other way to stave off a spending decrease after a bad experience is to respond and fix the bad experience quickly. Companies that recovered poorly from a bad experience lost sales from 62% of their customers, compared with the 21% of lost sales from companies that revered very well, according to the research.
“Every large organization, no matter how good it is, ends up delivering a bad experience for some of its customers,” Temkin says. “So the ability to respond and fix a bad experience is really important.”