Connect with us

Business

Avoidable customer churn costs British businesses £25 billion

Published

on

Avoidable customer churn costs British businesses £25 billion
  • Banks come eighth in the CallMiner Index – down from sixth over five years
  • Consumers want to stay loyal but bad practices with new customer offers and bad call centre experiences drive people away

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 £25.05 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:

        Sector position last five years Sector position last 12 months
1.       Electricity companies (43%) 1.       Electricity companies (29%)
2.       Broadband companies (37%) 2.       Insurance companies (24%)
3.       Gas companies (36%) 3.       Gas companies (24%)
4.       Insurance companies (33%) 4.       Broadband suppliers (23%)
5.       Mobile telephone company (28%) 5.       Mobile telephone company (17%)
       6.    Banks (24%)        8.    Banks (12%)

The same four sectors top the Index over five years. The banking sector has moved lower in the Index in the last 12 months, to eighth position from six over five years.

The pace of switching is on the rise
The CallMiner Index also looks at how often people have switched over the last five years by sector. The average rate of switching across all sectors is 3.4 times over five years or 0.68 times per annum on average. When you consider that the average rate for the last 12 months was 1.91 times, the rate of switching has accelerated by almost three times! But banks have the second lowest average out of all sectors, with bank customers switching three times in the past five years.

The main reasons for churn – falling foul of the Brits’ sense of ‘fair play’
The survey uncovered that consumers want to stay loyal but are ‘forced’ to switch because of suppliers’ bad practices. There is a difference between plans to switch and actual switching. For example, only 10% say they are planning to switch banks but 12% did so this year. This gap between intention and action can be seen across all the sectors.

The main actions by banks that force consumers to say goodbye are as follows:

  1. Prices are too high or have increased (69%)
  2. There is no reward for contract renewal i.e. no reward for loyalty (44%)
  3. Discounts offered to new customers are not automatically applied to your account (40%)
  4. Feeling like you are not being treated fairly (31%).

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 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 control physical pain. The reaction can genuinely hurt! That’s why people will go to great lengths to right wrongs. In the case of suppliers this can include burning lots of time in having a complaint handled, defecting to another company, bad mouthing the supplier online and offline and in more extreme cases, pursuing legal avenues.”

Unsurprisingly, the advice banking 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 (79% v 69%); reward them for renewing their contract (69% v 44%) and automatically apply new discounts to their existing account (61% v 40%).

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. Banks could reduce their churn rates still further if they listened to what consumers are saying in this research and put treating customers fairly at the heart of their brand values.”

Banks not seen as good at recognising vulnerability
Thirty percent of banking customers scored between 0 and 4 (when 0 is not at all good and 10 is extremely good) when asked how good they think banks are at recognising when a customer may be vulnerable/need sympathetic handling (such as when they are in debt or contacting to handle things related to a deceased family member).

Call centres are now centre stage in the battle for loyalty

The telephone remains the preferred way to contact suppliers and is subsequently the #1 channel used. Almost a third (32%) of banking customers list the phone as their first preferred method to interact with their bank. However, double the number of consumers (64%) used the phone to contact banks in the last year. This may be because the top two reasons to contact banks relate to problems with charges (65%) or resolving a technical problem with the product or service (60%). Both these issues require specialised support from a contact centre agent. Issues around charges fall into the category of avoidable triggers for churn.

Call centre experience can decide if consumers stay or say goodbye – empathy is key to success

When it comes to delivering services to keep banking consumers loyal, call centres top the list: 69% want call centre staff to be aware of their service history so they don’t have to explain multiple times.

The survey also uncovered that call centres play a pivotal role in a consumer’s decision to switch or stay loyal. When asked how likely they are to switch their banks if they have a bad experience with a call centre, 72% scored between 7 and 10 on a 0 – 10 scale (where 10 = extremely likely). This is 4% more than the whole sample. About one in five (22%) scored 10. When asked how likely they are to stay loyal to their bank if they have a good experience with a call centre, (71%) scored between 7 and 10 – 3% lower than the whole sample – with 20% scoring 10.

The ability to show empathy seems to be key to success. When asked about their emotional state before a call to a call centre, the top response by 44% of banking consumers is that they want someone to listen to them. The next four answers show what a tough job call centres staff have in dealing with the emotional state of callers. Two fifths (40%) say they arrive annoyed; almost a third (31%) arrive hopeful; 21% arrive confused and the same number arrive ready for an argument!

It seems some call centres are good at taking the heat out of the situation. The second highest response for the emotional state after the call, by almost one third of banking consumers (32%), is satisfied. The percentages of people feeling angry, annoyed or upset, all show reductions of an average of 28% from the before-call figures.

However, other call centres may be less empathetic. The highest response by over one third of people (36%) is feeling frustrated and third highest (28%) is feeling annoyed. Despite reductions in negative emotions post call, the percentage is still high with 58% of customers reporting negative emotions (Angry, Annoyed, Upset, Confused, Frustrated) after contact with a call centre. When it comes to meeting consumers’ need to be listened to, banking companies do not perform as well as consumers would like. In fact, less than half of those who wanted to be listened to before the call (44%) felt that they had been after the call (20%) – meaning they left the call feeling ignored.

Aimee Lucas, Vice President and Customer Experience Transformist, at Temkin Group, said: “Our own research shows that call centre interactions that were more emotionally negative led to longer calls, more frequent transfers, and lower likelihood of the customer recommending the company to others. It’s imperative that companies use the available tools to their advantage to identify reasons leading to negative customer experiences and churn and coach their call centre staff on the behaviours that create more positive interactions with customers.”

callminer UK churn infographic

callminer UK churn infographic

Business

Northern Irish Brexit issue is two-way street, says EU’s Sefcovic

Published

on

Northern Irish Brexit issue is two-way street, says EU's Sefcovic 1

BRUSSELS (Reuters) – Britain must show it is fully using the avenues available under the Brexit divorce deal to minimise trade disruption in Northern Ireland before seeking concessions, a senior EU official said on Tuesday.

Britain’s exit from the EU’s trading orbit in January has created trade barriers between Northern Ireland – which remains in the EU’s single market for goods – and the rest of the United Kingdom.

Maros Sefcovic, a vice president of the European Commission, said he hoped to learn of British efforts during an online meeting on Wednesday .

“I was also reminding my British partners that this must be a two-way street,” he told a news conference.

Sefcovic said real-time access to the IT systems of customs could smooth customs processes and a trusted trader scheme could ensure Northern Irish supermarkets were properly supplied.

“I hope that tomorrow… we will get feedback from our UK partners on how all these flexibilities and grace periods are being used because it’s clearly a pre-requisite for the EU, the Commission and the member states to assess any further requests,” Sefcovic said.

The EU’s insistence on Britain honouring its withdrawal treaty has left the British province of Northern Ireland within the EU’s single market and put a customs border in the Irish Sea dividing the province from mainland Britain.

Sefcovic said that there were inevitable consequences of Brexit so not everything could be resolved.

Members of Northern Ireland’s two largest pro-British parties have said they are set take part in legal action challenging part of Britain’s divorce deal.

However, Sefcovic said companies there might over time see the divorce arrangements as an advantage.

“Being in the single market and at the same time the internal market of the UK is actually a great business opportunity. And I hope that our joint work will amplify this possibility,” he said.

(Reporting by Philip Blenkinsop. Editing by Mark Potter)

 

Continue Reading

Business

Calabrio charts record year-on-year UK growth as demand for cloud technology soars during lockdown

Published

on

How cloud technology can help you keep on top of your business finances

Digital transformation acceleration drives cloud contact centre adoption of Calabrio workforce engagement management technology

Calabrio, the workforce engagement management (WEM) company, has seen a strong growth trajectory in the UK during the last 12 months, despite the global pandemic. Achieving 30% year-on-year sales growth, Calabrio International has welcomed more than 150 new customers, with the UK adding a third of those from a wide range of industries including many online challenger businesses. In addition, Calabrio has made strategic new appointments to build its customer support network.

Calabrio charts record year-on-year UK growth as demand for cloud technology soars during lockdown 2

Kris Mckenzie

Kris McKenzie, SVP, Sales, International at Calabrio commented, “Our focus on cloud-first solutions has resonated well with our customers’ need to accelerate their digital transformation and move their contact centres to the cloud in order to maintain business continuity. At a time of uncertainty when consumers need robust support more than ever before, we are witnessing first-hand the cloud transformation of customer services by organisations looking to deliver the next level in customer experience. Modern businesses and contact centres using Calabrio are able to provide exceptional service to their customers through disrupted times.

“Coupled with businesses operating solely online, we have also seen strong demand across the board from more traditional sectors such as finance, insurance, retail, consumer goods, local and central government departments. These organisations require an innovative yet reliable solution to help them manage unprecedented levels in demand.”

When Calabrio surveyed its customers recently[i] 72% of organisations stated they are either moving to the cloud, are already there or plan to increase their investment in cloud technology in 2021. In order to support forward-thinking organisations looking to optimise their investment in cloud contact centre solutions, Calabrio has made two significant appointments.

Niall Gallacher has joined Calabrio as Business Intelligence (BI) strategic consultant and will be instrumental in the design of services that drive value from data and analytics, helping Calabrio customers to solve complex business problems. Before joining Calabrio, Niall spent 6 years with Qlik as Industry Solutions Director. He has 25 years of experience in data, analytics and BI, 15 of which have been with contact centres for leading companies in telecommunications, energy and high-tech industries.

Graeme Gabriel joins as a presales engineer, supporting Calabrio’s workforce engagement suite. He will work with customers to ensure that they achieve maximum benefit from their use of Calabrio solutions, no matter the remote, on-site or hybrid environment. Graeme has international experience encompassing telephony, contact centre, WFM, analytics and customer experience (CX) across a range of sectors, and has held consultancy, advocacy and planning positions at companies including Injixo, Vluent, QPC and AVIOS.

McKenzie concluded, “We welcome both Niall and Graeme to Calabrio, during what has been an incredible year of growth for Calabrio as we supported our customers through these challenging times. This is an exciting and dynamic time for Calabrio as we continue to deliver the value of our all-in-one cloud contact centre suite, including call recording, quality management (QM), WFM, speech analytics and business intelligence suitable for organisations of all shapes and sizes.”

[i] TechValidate survey of 192 users of Calabrio.  Published 29 December 2020.

 

This is a Sponsored Feature.

Continue Reading

Business

Thomson Reuters fourth-quarter revenue, adjusted earnings rise

Published

on

Thomson Reuters fourth-quarter revenue, adjusted earnings rise 3

NEW YORK (Reuters) – Thomson Reuters Corp reported higher fourth-quarter revenue on Tuesday and said it would start a two-year program that will change it from a holding company to an operating company.

The news and information company, which owns Reuters News, said revenues rose 2% to $1.62 billion, while its operating profit jumped more than 300% to $956 million, reflecting the sale of an investment, a gain from an amendment to pension plan and lower costs.

Its three main divisions, Legal Professionals, Tax & Accounting Professionals and Corporates, all showed higher organic quarterly sales and adjusted profit.

It was not immediately clear if adjusted earnings per share of 54 cents were directly comparable to the 46 cents expected.

Thomson Reuters’ markets are healthy and evolving, making this a good time to transition the company from a content provider to a “content-driven technology company,” Chief Executive Steve Hasker said in a statement.

Workplaces have been transformed by the COVID-19 pandemic and artificial intelligence has a larger role in professional markets, he said.

(Writing by Nick Zieminski in New York, editing by Louise Heavens and Jane Merriman)

Continue Reading
Editorial & Advertiser disclosureOur website provides you with information, news, press releases, Opinion and advertorials on various financial products and services. This is not to be considered as financial advice and should be considered only for information purposes. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third party websites, affiliate sales networks, and may link to our advertising partners websites. Though we are tied up with various advertising and affiliate networks, this does not affect our analysis or opinion. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you, or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish sponsored articles or links, you may consider all articles or links hosted on our site as a partner endorsed link.

Call For Entries

Global Banking and Finance Review Awards Nominations 2021
2021 Awards now open. Click Here to Nominate

Latest Articles

Analysis: Bubbles, bubbles bound for trouble? 4 Analysis: Bubbles, bubbles bound for trouble? 5
Investing4 hours ago

Analysis: Bubbles, bubbles bound for trouble?

By Marc Jones and Thyagaraju Adinarayan LONDON (Reuters) – The $6.2 billion-an-hour rise in the value of world stocks since...

Exclusive: AstraZeneca to miss second-quarter EU vaccine supply target by half - EU official 10 Exclusive: AstraZeneca to miss second-quarter EU vaccine supply target by half - EU official 11
Top Stories4 hours ago

Exclusive: AstraZeneca to miss second-quarter EU vaccine supply target by half – EU official

By Francesco Guarascio BRUSSELS (Reuters) – AstraZeneca expects to deliver less than half the COVID-19 vaccines it was contracted to...

Northern Irish Brexit issue is two-way street, says EU's Sefcovic 12 Northern Irish Brexit issue is two-way street, says EU's Sefcovic 13
Business4 hours ago

Northern Irish Brexit issue is two-way street, says EU’s Sefcovic

BRUSSELS (Reuters) – Britain must show it is fully using the avenues available under the Brexit divorce deal to minimise...

Oil holds near year-long highs as COVID lockdowns seen easing 14 Oil holds near year-long highs as COVID lockdowns seen easing 15
Investing8 hours ago

Oil holds near year-long highs as COVID lockdowns seen easing

By Bozorgmehr Sharafedin LONDON (Reuters) – Oil prices were steady on Tuesday, trading close to more than year-long highs on...

gbaf1news gbaf1news
Technology8 hours ago

Thomson Reuters to stress AI, machine learning in a post-pandemic world

By Kenneth Li and Nick Zieminski NEW YORK (Reuters) – Thomson Reuters Corp will streamline technology, close offices and rely...

Dollar mixed after Powell, pound hits three-year high 16 Dollar mixed after Powell, pound hits three-year high 17
Trading8 hours ago

Dollar mixed after Powell, pound hits three-year high

By Kate Duguid NEW YORK (Reuters) – The dollar reversed earlier gains on Tuesday morning after a dovish speech from...

Tesla shares in the red for 2021 as bitcoin selloff weighs 18 Tesla shares in the red for 2021 as bitcoin selloff weighs 19
Investing8 hours ago

Tesla shares in the red for 2021 as bitcoin selloff weighs

By Julien Ponthus LONDON (Reuters) – Shares in Tesla were set to plunge into the red for the year on...

Facebook 'refriends' Australia after changes to media laws 20 Facebook 'refriends' Australia after changes to media laws 21
Top Stories9 hours ago

Facebook ‘refriends’ Australia after changes to media laws

By Byron Kaye and Colin Packham CANBERRA (Reuters) – Facebook will restore Australian news pages, ending an unprecedented week-long blackout...

How cloud technology can help you keep on top of your business finances How cloud technology can help you keep on top of your business finances
Business9 hours ago

Calabrio charts record year-on-year UK growth as demand for cloud technology soars during lockdown

Digital transformation acceleration drives cloud contact centre adoption of Calabrio workforce engagement management technology Calabrio, the workforce engagement management (WEM)...

Gastric Electric Stimulators Market Size Worth US$ 188.4 Mn by 2026 – Future Market Insights 22 Gastric Electric Stimulators Market Size Worth US$ 188.4 Mn by 2026 – Future Market Insights 23
Research Reports11 hours ago

Gastric Electric Stimulators Market Size Worth US$ 188.4 Mn by 2026 – Future Market Insights

The worldwide uptake of gastric electric stimulators is anticipated to witness hefty demand in 2019, representing a rigorous 6.6% y-o-y...

Newsletters with Secrets & Analysis. Subscribe Now