Customer Service Attracts Loyal Customers

In a new research report called Service Seekers Are More Loyal Than Price Seekers (based on a survey of about 4,600 US consumers), we analyze the loyalty of four consumer segments that I’ve previously discussed in this blog:


Source: Forrester Research

The report examines the loyalty of these segments across 12 industries: airlines, banks, wireless providers, credit card providers, hotels, insurance firms, Internet service providers, investment firms, health plans, PC manufacturers, retailers, and TV service providers. Across all industries and consumer segments, I analyzed three areas of loyalty: willingness to buy more products, reluctance to switch from current providers, and likelihood to recommend providers to friends and colleagues.

Here are some of the interesting findings from the analysis:

  • Across all 12 industries and all 3 measures of loyalty, Service Seekers are more loyal than Price Seekers
  • In all 12 industries, the most loyal segment is either Service Seekers or Price & Service Seekers.
  • In 10 of the 12 industries, Service Seekers are the most reluctant to switch away from their current provider.
  • The gap between loyal Service Seekers and loyal Price Seekers is at least 20% in the following areas:
    • Willingness to buy: Credit card providers, TV service providers, Internet service providers, airlines, and insurance providers
    • Reluctance to switch: Airlines, TV service providers, insurance providers, and hotels. 
    • Likelihood to recommend: TV service providers, credit card providers, medical insurers, Internet service providers, and insurance providers.
  • The gap between loyal Service Seekers and loyal Price Seekers is lower than 10% in only the following areas:
    • Willingness to buy: Banks, investment firms, and retailers.
    • Likelihood to recommend: Retailers, banks, and PC manufacturers.

The bottom line: Good customer service attracts more loyal customers.

About Bruce Temkin, CCXP
I'm an experience (XM) management catalyst; helping organizations improve results by engaging the hearts and minds of their employees, customers, and partners. I enjoy researching and speaking about these topics. I lead the Qualtrics XM Institute, which is the world's best job. We're igniting a global community of XM Professionals who are inspired and empowered to radically improve the human experience. To achieve this goal, my team focuses on thought leadership, training, and community building. My work is driven by a set of fundamental beliefs: 1) Everything starts and ends with human beings, so you need to understand how people think, feel, and behave; 2) XM is a discipline that needs to be woven throughout an organization's entire operating fabric; and 3) Building the XM discipline requires a combination of culture, competency, and technology.

10 Responses to Customer Service Attracts Loyal Customers

  1. Pingback: Bruce Temkin: Customer Service Attracts Loyal Customers « Fredzimny’s CCCCC Blog

  2. Web Survey says:

    Customer service plays an important role in an organization’s ability to generate revenues, and as such, customer service should be a fundamental part of any company’s “valued customer” approach. In fact, there’s an enormous body of research, which strongly indicates that customer satisfaction and loyalty; are major contributors to profitability.

    Thank you for sharing your knowledge and insight.

    Best wishes.

  3. Fascinating stuff Bruce – I think this provides even more evidence that companies need to be finding out from their customers why they have chosen them and /or are considering them.

    Knowing what your customers’ priorities are helps focus your efforts and resources accordingly. Sadly, too many buinsesses never ask.

    A simple question I like is ‘why do you buy from us?’

    Bruce (and anybody else!), have you got any better ones?

  4. Pingback: Price not the Path to True Customer Loyalty at Insuring the Insurance Experience

  5. Pingback: A Good Week For Customer Service « Customer Experience Matters

  6. Pingback: 10 Top Blog Posts on Customer Service / Support | Advertising News

  7. Amy Judd says:

    Interesting read. I’ll make sure to read the full report.

  8. Pingback: You Can Trim Many Things, But Not the Customer Experience « will enter this info later

  9. Pingback: Top 250 Blog Posts – Advertising, Marketing, Media and PR « Spotlight Ideas

  10. Outsource Call Center says:

    Best customer service implies practices that bring in and keep clients. . It affects important brand and business objectives like customer satisfaction, loyalty and etc. I am definitely agreed that it is the key to attracting and maintaining customers, which leads to increased business and revenue.
    Business Answering Service

Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: