Capitalising on an increase in customer satisfaction

The findings of our latest UK Customer Satisfaction Index, launched this week, once again sent a clear signal to UK businesses – with greater potential to build on the opportunity to drive the improvement forward.

Investing in customer service can be a catalyst for building consumer confidence, increasing loyalty and spend, and driving long-term growth.

I was therefore encouraged to see customer satisfaction at its highest level in over three years, especially given the challenges posed by economic and geopolitical uncertainty.

But as a cornerstone of the UK economy, driving 80% of GDP and employing 60% of the workforce, the Service Nation has a long way to go. If we are to drive sustainable growth in the UK economy, the recent improvements in service need to be built upon and sustained over the coming years.

The value of service excellence

After a lengthy period of decline and stagnation, average satisfaction across all sectors in the UK has hit 77.3 out of 100, marking a 1.5-point increase compared to a year ago. There are two main factors driving this upturn.

First, more organisations have improved their effectiveness in reducing problems and delivering “right first time” experiences. And second, more customers feel businesses have demonstrated genuine care by understanding and responding to their personal needs.

I have long argued, and our research regularly shows, that organisations that are able to provide this level of service experience consistently will invariably succeed in the long term.

But for me, most striking is the bottom-line value that is afforded to organisations when customer service, the experience, and overall satisfaction are the priority – from the boardroom to the shop floor.

The latest UKCSI results show that more than a third (33.5%) of customers would prefer to receive excellent service even if it means paying more – 2.4 percentage points higher than a year ago – while 82% of consumers would be more likely to follow through with a major purchase if they receive excellent service. This illustrates the financial dividend a service culture provides.

Grasping the opportunity

Higher levels of service encourage customers to spend more with an organisation, particularly for big-ticket purchases. From a UK-wide perspective, it is hard to overstate the opportunity this presents for businesses – and regulators and policymakers focused on boosting economic growth can harness this insight to support in the right way.

This week saw consumer confidence rise as the summer season gets underway, and our own data tells us that over a third of consumers (35%) are planning to make a major purchase in the next 12 months.

So, the opportunity is clear for UK PLC. By investing in customer service, organisations stand to benefit from a growing preference for a better experience, as well as a lift in public confidence to spend.

The rise in customer satisfaction suggests we are starting to move in the right direction. The challenge now is to ensure that this isn’t just a temporary fillip but a fundamental shift in a new era. Ultimately, it is up to us as business leaders to grasp the opportunity, or risk being eaten by those more committed to serving their customers.