Bad service causes more shoppers to ‘walk out’

by Ombudsman Services | Mar 21, 2018

  • 78 million issues last year were ignored by consumers, an increase of three million from 2016
  • Consumer activism on the rise as ‘walk outs’ and switching suppliers becomes commonplace
  • 69 per cent of consumers are resigned to poor service in one or more sector
  • Poor customer service sees trust nosedive, with three in 10 (28%) consumers trusting businesses’ less now than three years ago

Consumers experienced 173 million issues with products and services in 2017 but less than one in three (27%) of these were reported to companies.

According to Ombudsman Services’ fifth annual CAM 2018 report – the largest multi-sector survey of its kind in the UK – consumers ignored 78 million issues last year, an increase of three million from 2016.

Long-term frustration lies behind the increase as, among all consumers, three in 10 (29%) believe you can only get a result from a complaint if you kick up a big fuss, while one in five (20%) did not take their complaint further as they had previously raised an issue but nothing changed, leaving many disillusioned.

Instead, poor service is resulting in many more voting with their feet. Two in five (40%) UK shoppers ‘walked out' or 'gave up' before completing a purchase offline or online, up from 29 per cent in last year’s report, while three in 10 (30%) chose to switch providers or spend less because of disappointing experiences.

Retailers are most likely to be affected by this, with one in three (33%) shoppers saying they’ve stopped buying from a specific brand in the past 12 months. Without clear ways to complain, many consumers may feel that ‘protesting’ by withdrawing custom is the only way to hold firms to account. Meanwhile, sectors like Telecoms (11%) and Energy (8%), where consumers are better protected, are significantly less likely to see customers switch brands as a result of poor service.

This type of consumer activism is bad news for businesses because they are not given the opportunity to resolve the issue. Most (86%) consumers say their trust in companies is dented if their family and friends have bad experiences, and with one in five (19%) consumers now moaning to their friends and family after they have encountered an issue, rather than speaking to the company, ‘passive activism’ is making it harder than ever for businesses to track customer service and improve.

Last year consumers made 47 million complaints in total, down by eight million from 2016 (see table 1 below for sector breakdown).

Lewis Shand Smith, Chief Ombudsman at Ombudsman Services, said: “Consumers are understandably frustrated with poor service and when expectations are not met, the disappointment can lead to anger and frustration. Voting with your feet is one way you can show dissatisfaction. However, complaining is the only real way to get issues resolved, so we’d encourage anyone with a complaint to come forward and make their voices heard instead of ending up angry and uncompensated.

“With customer disillusionment giving way to a new type of consumer activism, businesses need to shift their thinking when it comes to customer service. The most successful companies are those that use technology to complement their customer service, and take a 360-degree view of the complaints process – so that trends can be identified and problems are addressed at the root.

“If consumers complain more and companies commit to improving customer service issues, the result will be consumer protection that is good for consumers and good for business.”