KEY POINTS

  • Customer service is extremely important to a retailer's bottom line. 66% of US consumers are willing to spend more money with a company that provides them with excellent customer service, according to Microsoft, while 60% of consumers say they have not completed an intended purchase due to a poor customer service experience.
  • Positive customer service experiences are especially important for online retailers. Online shoppers regularly buy products they have not seen in person, which leaves room for purchasing errors and buyer's remorse. With online return rates hovering around 30-40%, retailers need to efficiently resolve consumer issues.
  • The phone is the top customer service channel. Consumers like the phone because of its ability to help solve problems efficiently and in real time. However, it can take too long to talk to the person who can resolve an issue.
  • Email ranks as the second-most used channel and is the go-to channel for addressing non-urgent inquiries. On average, it takes between one or two email messages to resolve customer issues, according to a North Ridge group study. That said, one-third of retailers do not respond to customer inquiries at all, according to Superoffice.
  • Live chat is a much newer channel than either email or the phone, but it has quickly been embraced by online-only merchants. This type of assistance is often used by customers during the shopping process rather than after an order has been placed. Many larger merchants, including Macy’s, Target, and Best Buy, still haven’t incorporated the functionality, but we expect them to do so once they can put the needed infrastructure behind the service.
  • Messaging apps are quickly becoming a new type of live chat service. WeChat in China, KakaoTalk in South Korea, and LINE in Japan function as veritable platforms for all kinds of engagement between users and retailers, and now Facebook is taking a page from these platforms by building out Messenger's customer service offerings for brands.
  • Social media does not yet provide efficient, helpful customer service. One-third of consumers who use it say that their requests have gone unanswered. The problem is likely that many consumers believe that requests made via this channel should be addressed efficiently — in keeping with social media's immediacy — but retailers aren't actually set up to respond at the speed of social. 
  • Providing the best-quality customer service is especially important to [...]