The Customer Service Survey
VocaLabs' weblog providing news and commentary on the challenges of providing good customer service.
SectorPulse commentary
Wednesday - October 19, 2005 01:45 PM in
We've just tabulated the results of the Vocalabs SectorPulse studies we conduct on the major airlines, wireless carries and banking institutions.
Most of you know that Vocalabs does not provide consulting services to avoid the possibility of biased data gathering. Our press releases and reports reflect that objectivity. But in a blog, we can more readily express our opinions and make observations about our findings.
There is quite a bit one can infer from this data, and several of the major observations are:
Cellular, or more correctly, wireless carriers seems to be an industry we all love to hate. Perhaps this is because wireless is inherently less reliable than the traditional wireline network, yet we increasingly depend on our cell phones as an integral part of our lives. The reality however is that overall, the wireless phone companies provide customer care at performance levels similar or slightly above average when compared to other markets. Verizon Wireless for example is in the top quartile for ALL businesses in the level of caller satisfaction they provide, and more than 8 of 10 callers to their customer service are able to complete their business in a single call. Considering that some calls can be quite complex to resolve, that's a pretty good average. Both Cingular and T-Mobile have satisfaction and call completion scores just a few percentage points behind Verizon as well. It is also interesting to note that each of these carriers handles almost 1/2 of their inbound customer service calls via self service technology. Only Sprint PCS has average or below scores, and we see that Sprint has both the highest rate of automation at 58% of calls and also has an average call length roughly a half minute shorter than the top performers. Those factors and that Sprint's scores on caller frustration are running 9-10% worse than the top three strongly suggests the validity of VocaLabs rule #1: If you design a customer care system with a focus on saving money over serving customers, you will do neither; but if you focus on service first and cost control second, you will achieve both happier customers and lower costs.
Among the major airlines (another industry we love to hate) as one looks at both current and past reports, the performance spread between the legacy carriers and the upstarts is very noticeable. Southwest's scores tend to fall into the top 5% of ALL industries with JetBlue tracking not far behind, and one very bankrupt but still flying legacy carrier is among the worst. In certain categories, the spread from best to worst might not seem great (3 of 10 callers to the worst performer have to call back more than once to complete their business, but just 1 of 10 at the better ones). But the impact of a 20% spread in the number of callers that finish their business with one call has a dramatic impact on costs and is one of the reasons why the better performers have satisfaction ratings as much as 5 times greater. Interestingly as the data gathering portion of our current SectorPulse-Airlines was wrapping up, Northwest and Delta both declared chapter 11. But Northwest actually improved their caller satisfaction rating to an "A" from a "B" and Delta moved from a "C" to a "B" in single call completion on our previous study. It will be interesting to see if these carriers can sustain their service levels in the coming months.
We have run only two SectorPulse reports on the financial services (banking) industry, and thinking it over, I am not overly surprised that the scores for single call completion have been mostly "D"s. Bank transactions tend to be more complex and so logically result in a greater number of multiple call transactions. And it is not terribly hard to imagine that the typical "C" grade for overall caller satisfaction, is due, at least in part, to higher expectations when a customer's finances are involved. That said, we have seen two banks with pronounced improvements since our initial report. Washington Mutual jumped from a "C" to an "A" in caller satisfaction. Single call completion improved by 6% as well as the length of the average call dropping by nearly a full minute. With no significant change in the percent of calls handled by automation or in caller frustration levels, there is no obvious reason why. Only Wells Fargo showed that kind of improvement although we didn't have quite enough data to officially include them in the current report. That said, we find the preponderance of average and below scores especially troublesome because financial institutions in particular ought to be aware that lower quality service is in the end, more costly than good customer care. We reject the easy presumption that because it is harder to switch banks than it is an airline, there is less an incentive for banks to improve. Could it be that WAMU and Wells Fargo have truly realized that good service will draw customers from the competition? Perhaps.
It is also not surprising that our first look at PayPal resulted in average or below results. There is a simple explanation. Namely, PayPal was created as a virtual entity. There is no brick and mortar PayPal "bank". Begun as a fee based electronic funds transfer company whose success rose with the increase in on line sales such as e-Bay auctions (e-Bay now owns the company), all its customers came from Internet business and there was no telephone based customer care. All routine PayPal transactions remain Net based. Phone support then attracts a greater percent of complex problem calls from already disgruntled customers; logically making lower scores likely.
Posted by Rick Rappe
There is quite a bit one can infer from this data, and several of the major observations are:
Cellular, or more correctly, wireless carriers seems to be an industry we all love to hate. Perhaps this is because wireless is inherently less reliable than the traditional wireline network, yet we increasingly depend on our cell phones as an integral part of our lives. The reality however is that overall, the wireless phone companies provide customer care at performance levels similar or slightly above average when compared to other markets. Verizon Wireless for example is in the top quartile for ALL businesses in the level of caller satisfaction they provide, and more than 8 of 10 callers to their customer service are able to complete their business in a single call. Considering that some calls can be quite complex to resolve, that's a pretty good average. Both Cingular and T-Mobile have satisfaction and call completion scores just a few percentage points behind Verizon as well. It is also interesting to note that each of these carriers handles almost 1/2 of their inbound customer service calls via self service technology. Only Sprint PCS has average or below scores, and we see that Sprint has both the highest rate of automation at 58% of calls and also has an average call length roughly a half minute shorter than the top performers. Those factors and that Sprint's scores on caller frustration are running 9-10% worse than the top three strongly suggests the validity of VocaLabs rule #1: If you design a customer care system with a focus on saving money over serving customers, you will do neither; but if you focus on service first and cost control second, you will achieve both happier customers and lower costs.
Among the major airlines (another industry we love to hate) as one looks at both current and past reports, the performance spread between the legacy carriers and the upstarts is very noticeable. Southwest's scores tend to fall into the top 5% of ALL industries with JetBlue tracking not far behind, and one very bankrupt but still flying legacy carrier is among the worst. In certain categories, the spread from best to worst might not seem great (3 of 10 callers to the worst performer have to call back more than once to complete their business, but just 1 of 10 at the better ones). But the impact of a 20% spread in the number of callers that finish their business with one call has a dramatic impact on costs and is one of the reasons why the better performers have satisfaction ratings as much as 5 times greater. Interestingly as the data gathering portion of our current SectorPulse-Airlines was wrapping up, Northwest and Delta both declared chapter 11. But Northwest actually improved their caller satisfaction rating to an "A" from a "B" and Delta moved from a "C" to a "B" in single call completion on our previous study. It will be interesting to see if these carriers can sustain their service levels in the coming months.
We have run only two SectorPulse reports on the financial services (banking) industry, and thinking it over, I am not overly surprised that the scores for single call completion have been mostly "D"s. Bank transactions tend to be more complex and so logically result in a greater number of multiple call transactions. And it is not terribly hard to imagine that the typical "C" grade for overall caller satisfaction, is due, at least in part, to higher expectations when a customer's finances are involved. That said, we have seen two banks with pronounced improvements since our initial report. Washington Mutual jumped from a "C" to an "A" in caller satisfaction. Single call completion improved by 6% as well as the length of the average call dropping by nearly a full minute. With no significant change in the percent of calls handled by automation or in caller frustration levels, there is no obvious reason why. Only Wells Fargo showed that kind of improvement although we didn't have quite enough data to officially include them in the current report. That said, we find the preponderance of average and below scores especially troublesome because financial institutions in particular ought to be aware that lower quality service is in the end, more costly than good customer care. We reject the easy presumption that because it is harder to switch banks than it is an airline, there is less an incentive for banks to improve. Could it be that WAMU and Wells Fargo have truly realized that good service will draw customers from the competition? Perhaps.
It is also not surprising that our first look at PayPal resulted in average or below results. There is a simple explanation. Namely, PayPal was created as a virtual entity. There is no brick and mortar PayPal "bank". Begun as a fee based electronic funds transfer company whose success rose with the increase in on line sales such as e-Bay auctions (e-Bay now owns the company), all its customers came from Internet business and there was no telephone based customer care. All routine PayPal transactions remain Net based. Phone support then attracts a greater percent of complex problem calls from already disgruntled customers; logically making lower scores likely.
Posted by Rick Rappe
Posted at 01:45 PM by | | | |