Study Shows High-Tech Conveniences May Hurt Customer Service, Satisfaction

January 26, 1998

When a customer had a technical question about his answering machine, he used the Internet to find the manufacturer's contact information. Yahoo offered him access to the company’s site, but when he clicked on that choice, he found himself at a sex site.

The customer called the manufacturer to report the Internet problem, and the representative chuckled. They had known about the mix-up for a week.

Amusing? Not when you think of the potential impact on the manufacturer's image, according to CU-Boulder marketing Professor Tom Duncan.

Duncan and a team of student researchers in CU's Integrated Marketing Communications graduate program at the School of Journalism and Mass Communication found the incident reflects a problem of greater magnitude: Organizations make investments in elaborate phone systems and Web sites presumably to improve customer service only to find these “improvement” efforts are falling short.

The researchers contacted 146 organizations by phone or e-mail and asked the same kinds of questions a customer might pose. The study encompassed 86 high-profile organizations and 60 lesser-known ones, split almost evenly between the business-to-business, consumer service and consumer goods markets.

The news is not good. Only 48 percent of the well-known entities and 63 percent of the smaller companies answered inquiries on the customer's first try. In the business-to-business sector, only 33 percent of the nationally known organizations responded to the customer's first attempt to communicate.

In one example, a computer manufacturer's technical support hotline put a customer on hold for 10 minutes on two occasions. There was no answer on the third try.

Another example: A company includes mailing and Web site addresses but no phone number on its shampoo packaging. A 14.4 modem and older computer proved insufficient to access their Web site. A user clicked on the "problem" option and waited 10 minutes for the page to load. It didn’t.

“This situation demonstrates the need to have phone numbers on packaging. Not everyone has access to Web technology,” said IMC student Leigh Ann Steere, who noted regular mail is not an option for something needing immediate attention.

In another scenerio, a well-known electronics manufacturer greets customers with a complex automated voice system. The menu choices do not match all reasons for calling, and customers guess which selection best fits their needs. Callers must hang up and start over again if they press an incorrect number because there is no way to return to the beginning of the menu or talk directly to an operator.

Yet another snafu: A major retailer's Web site professes to allow access to upper management. An e-mail addressed to the Customer Relations Department received no reply. A second, sent to the VP of Corporate Relations, bounced back two days later, emblazoned with the messages "User Unknown" and "Permanent Fatal Errors."

Fatal indeed. In 146 contacts, CU's team found 54 examples similar to those above (more than one-third of the study), including 10 organizations that never responded. In addition, another 20 percent provided only fair service. Only 42 percent produced good results. Web sites and e-mail addresses sponsored by consumer products companies generated the most dismal performance: 78 percent were “unacceptable.”

“Although more and more companies say they are putting the customer first and practicing relationship marketing, this study shows that most are not walking their talk,” said Duncan, co-author of the popular book “Driving Brand Value.”

Although there were a few bright spots in the survey –- at Pitney Bowes a person answered on the first ring –- the CU study points to a widespread problem. One of the researchers noted, “In real life, I would have given up much sooner on over half the companies I selected for this study and disregarded them among my choices as a consumer.”

According to Duncan, the study results should be a wake-up call for corporate executives.

Examples of national organizations in CU study:

America Online Anheuser Busch

Apple AT&T

Casio Compaq

Dell Ford Motor Company

General Motors Gillette

Hewlett-Packard Kinko's

Kraft MCI

Nissan Pitney Bowes

Proctor & Gamble Radio Shack

Social Security Administration Sony

Sprint Target

United Airlines Mileage Plus

Examples of regional or niche entities:

Aveda Aspen Wellness

Colorado National Bank IAMS Dog Food Company

Tazo Tea Timberland

Toms of Maine

Note: For the purpose of the study, CU defined "good" as a customer inquiry satisfied easily, thoroughly and on the first try. The "fair" category also required answering the customer inquiry, however, the customer interaction involved one or more shortcomings, such as an unenthusiastic representative or a canned, barely-on-target response.

The designation of "unacceptable" went to non-responses, rude representatives, excessive "hold" times, unfriendly phone systems, off-target responses and other problems producing customer inconvenience or dissatisfaction.

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