PressA report by Orchid Consulting, call centre and customer service specialists published today, reveals that over half of broadband customers have switched suppliers at some point, a significantly higher figure than was previously thought. Interestingly, poor connectivity speed is the key reason why someone decides to switch, yet the choice of new provider is primarily based on price, not reliability of service. This creates the risk that customers are making the same mistake twice. The report shows that: 1 Churn is high in the broadband industry. Connectivity speed is the largest cause of dissatisfaction and the factor which is most likely to fall short of customer expectations 2 81% of people say that they are satisfied with their broadband supplier - a far higher figure that previous academic and industry research has found 3 However, there is no direct relationship between customer satisfaction and continued loyalty - broadband providers take heed 4 Service satisfaction does go some way to moderating switching behaviour, irrespective of alternative providers The UK broadband market has moved rapidly through product lifecycle stages in the last ten years, and the structure of the market has also changed considerably. The UK now has over 300 broadband providers and significant levels of infrastructure competition (OFCOM). In 2010, nearly nine out of ten connections to the internet in the UK are made via broadband according to the Office for National Statistics (ONS). In its latest survey, the organisation found that 88.4 per cent of Britons are now using broadband over dial-up. Customer switching in the broadband market is a significant issue for the businesses concerned, both within this specific sector and others, where the purchase of these products has become increasingly commoditised in recent years, where initial price would appear to be the biggest driver of acquisition, but where complaints about the service subsequently received by customers are reaching fever pitch levels. The research shows that customers expect the service to be reliable above all else when entering into a broadband relationship, with connection speed the next most important attribute, and over a quarter of customers say the customer service they receive does not match their expectations. They choose their provider because of price, then brand and then speed. The most common causes of dissatisfaction were speed, price, customer service then reliability of service. The key point at which dissatisfied customers switch was found to be speed on connectivity. Keith Gait, founder and principal consultant at Orchid Consulting and author of the report explains: "It's clear that broadband companies have got to walk the walk as well as talk the talk. It's no good spending a lot of money on advertising and building a brand if the customer expectations are not met. People aren't afraid of switching if connectivity speed is not up to scratch, and poor customer retention can prove very costly. Keith goes on to explain: "What's interesting is that price is the biggest single driver of purchasing decisions, not reliability of service. It would be more logical that if people want to switch that they should choose their new provider on the same basis that they decided to leave the old one. Otherwise it's not comparing apples with apples." The report has significant implications for customer service and customer retention managers. Keith comments: "Satisfaction or a continuing subscription is not an indicator or predictor of loyalty and should not be relied upon as a predictor of low churn behaviour. Management information should therefore be taken with a pinch of salt." Some figures suggest that there does appear to be a considerable degree of inertia amongst dissatisfied customers, with well over half of customers in this survey indicating they would not switch, even if they were dissatisfied with the reliability, speed or customer service. This is perhaps relied upon within broadband organisations, but there is a definite increase in the amount of customers looking to switch, and this cannot be relied upon to be sustainable. Keith adds: "Suppliers should not rest on their laurels. Good satisfaction levels will not necessarily be maintained and inertia can turn to churn very swiftly. The key learning is that you cannot focus simply on one aspect of your offering. Purchasing decisions and switching decisions are much more complex than any one single issue." More than 80 per cent of respondents had been with their provider for over a year before switching. This finding illustrates that it isn't just recently acquired customers that switch as many have previously thought. This further demonstrates that just because a customer continues to buy from an organisation it does not necessarily mean they have loyalty to that provider. This information is taken from the Report "What are the causes of customer dissatisfaction in the UK ISP market, and what drives dissatisfied customers to switch providers?" By Keith Gait, April 2010 A full version of the report is available on request. For further information please contact: Caroline Wiggins, Business Accent PR T: 01306 88 66 00 / M: 07739 709 073 E: caroline@businessaccentpr.co.uk |
03-Jun-10: Over one in two broadband customers have switched providers  14-Sep-09: Orchid's Keith Gait named in the industry Top 100 03-Apr-09: The Top 50 Call Centres for Customer Service Orchid are once again proud to be supporting the Top 50 programme. 13-Jan-09: Orchid launches its New Website 08-Jul-08: Orchid Consultant wins Interim Manager of the Year
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