Thursday, June 23, 2016

Can Service Providers Really Affect Customer Satisfaction Enough to Warrant High Investment?

Some things are hard to change. Perhaps some things are nearly impossible to change. So, as a matter of business priorities, how much should communications service providers invest in efforts to improve customer satisfaction? Maybe the answer is “not so much.”

Ecosystem providers who make a living selling solutions that are supposed to raise consumer satisfaction obviously will disagree. But you have to question the wisdom of spending too much to change consumer perceptions that might not improve all that much, no matter how much is spent.

Historically, few service providers and services ever rank anywhere but towards the bottom of consumer satisfaction surveys. Airlines typically have the same problem.

That might not be a good thing, but the amount of change that actually is possible is arguably questionable. In other words, beyond a certain minimal point, it might not be wise to invest too much in trying to improve consumer satisfaction scores, because there might be a sharp limit to the payoff, in terms of investment, compared to many other business processes that also require investment.

That is especially important when resources are limited and when a small number of actions arguably produce the bulk of value for any access service provider. It just makes sense to focus on the relatively smaller number of things that actually can influence business results.

And it arguably is hard to prove that investing in better customer satisfaction actually will produce very much change in business fortunes.

A Frost and Sullivan report commissioned by IBM argues that, by 2020, customer experience will overtake product and price as the key brand differentiator across all industries.

Access providers are “behind the curve,” Frost and Sullivan argues. “Research indicates that only one in six customers is an advocate for his or her CSP, and just 12 percent strongly agree their CSP listens to them and collects the right amount of information to meet their communications needs.

To be a contrarian, that might well be true. But with all the other problems access providers have, just how much should be invested to improve perceptions on such matters?

We have yet to see any evidence that a telco, cable company, mobile services provider or Internet service provider is able to score anywhere above the bottom half, or maybe even the bottom third, of industry consumer satisfaction ratings.

It is possible, in other words, that people simply are not satisfied with communications services for reasons that defy easy remedies. While it might be nice to outperform peers on satisfaction measures, it also is not clear that such relative advantages produce sustainable or measurable revenue lift.

Harsh, but historical data offers little support for the notion that an access provider is “loved” by its customers.

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