Superior customer service is more important than price in India: Ipsos Study

Consumers in India are fed up with poor service standards and are willing to pay more for a good customer experience, according to a survey by Ipsos which contradicts the common perception that "price is king" in India.

Placing a premium on good customer service, about half (49%) of Indian consumers are willing to pay more for better service, however, 26% of consumers still value price over service according to a study by Ipsos, a global market research organization who conducted this survey for Verint, on the state of customer service in the Asia Pacific region.
“Indians still rely heavily on human intervention as 58% consumers call customer service helplines frequently to get better service, which requires huge investment to be made by service providers. Since superior customer service is more important than price in India as reviled by the Ipsos survey, it gives service providers some opportunity to achieve a balance in investments made towards cost of efficient service delivery,” said Raja Amarjeet Bunet, Executive Director, Ipsos Loyalty, India.

Painting a poor picture of customer service in India, nearly 90-95 per cent consumers in utilities, financial services and telecom segments have faced a service problem within the past six months.

Key findings paint a common picture across Asia Pacific of poor customer service, frustrated consumers with low service expectations, an increased rate of sharing positive or negative experiences online to a wider audience, and a willingness to place a greater value on customer service than price.

In the survey of more than 5,800 consumers across six countries—including India, China, Hong Kong, Japan, Australia and Indonesia – consumers revealed that most have experienced poor customer service, and surprisingly, most have low expectations of receiving great service experiences. 

The study also validates that consumers are using multiple communications channels when sharing their good or bad service experiences. Almost seven in ten (68%) Indians will use traditional channels—such as phone, in person conversation to share with family and close friends. Rising social channels like Facebook, Twitter and blogs are reaching even wider audiences. Reinforcing this, Ipsos survey results revealed that 57% of consumers will share their experiences on social media, blogs and leave comments on company websites; 56% use Email; 34% will share experiences on public blogs; and 26% use micro-blog sites (e.g., Twitter).

Further, more Indian consumers expressed their desire to share positive rather than negative experiences at a rate of 56% for positive experiences compared to 43% for negative experiences. In effect, companies that can deliver a superior customer experience have an army of customer ambassadors positively increasing their brand awareness into the market via social channels.

“The research points to an increasing propensity among consumers to share positive feedback, experiences and interactions,” comments Ady Meretz, president APAC, Verint. “Companies that can proactively deliver a superior customer experience by listening and acting on the voice of the customer can gain competitive advantage in the market. Verint’s Voice of the Customer Analytics can help identify trends and capture feedback across a variety of channels, helping them take a proactive and responsive approach to customers’ wants, needs and expectations.”

The Ipsos survey also identifies two main drivers of poor consumer service experience by Indian Consumers: taking too long to resolve problems (21%) and unknowledgeable staff that can't help (20%).

Additionally, Indian consumers who didn’t have their problems resolved in the first contact were less satisfied than those that spent more time with service representatives working through issues without having to call back or visit again. For instance, in the retail sector, the study found that if customers had to call back to solve their problems, satisfaction dropped another 10%. 

Other factors leading to a poor service experience from the survey included: waiting too long to be serviced, receiving rude or unfriendly service, being served by unknowledgeable service representatives, and experiencing inflexible procedures.