Every year Ombudsman Services produces its Consumer Action Monitor. It undertakes research with consumers regarding complaints. This year it looked at the impact of Covid 19 on consumer complaining habits during March and September in 2020.
Figures released today (9 March 2021) by Ombudsman Services in its Consumer Action Report 2020 reveal that 83% of respondents agreed that a “Well-handled complaint increases my loyalty to a provider”.
Loyalty and complaint handling
10,149 consumers were asked about complaining to energy and telecom providers but it is likely that this would apply to other companies of all sizes too. Companies would do well to take heed of the findings. With it costing at least 5 times as much to gain a new customer as it does to retain one it is a very ignorant, arrogant, naïve or complacent (or mixture of any of the 4) company that does not pay attention to the value of good customer service.
From the Consumer Action Monitor 2020:
A well-handled complaint is one where the customer has been shown empathy, listened to, understood, treated fairly and given a satisfactory response in a timely manner. But it is widely known that the telecom and energy sectors are the worst for doing any of these things!
During March to September 2020 consumers showed leniency and tolerance to providers, as they complained less than in the preceding year. However, the reasons for this are not fully discussed. For example, it could be that consumers were under stress in other areas and that complaining about a provider was taking a back seat.
Understanding of Alternative Dispute Resolution when needing to complain
There is a huge lack of consumer understanding about Alternative Dispute Resolution (ADR). Only 3% of consumers knew that providers had 8 weeks to resolve a complaint before it could be escalated to an ADR provider, such as an Ombudsman.
The CAM research asked consumers how long they thought companies had to resolve a complaint:
The number of respondents knowing exactly where to take a complaint was a shockingly low 25%. The lack of awareness of ADR and what is does was quite apparent.
The CAM report asked consumers:
It was quite clear that consumers do not know or fully understand the time scales relating to complaints. A huge amount of work needs to be undertaken to raise the understanding of ADR for consumers. The reports Ombudsman Omnishambles and More Ombudsman Omnishambles outlined some problems with the ADR sector in the approval and monitoring of ADR providers and how the current and growing landscape is making things more confusing for consumers.
Vulnerable customers and complaining
The CAM report identified that during 2019 70% of vulnerable customers said that they would rather “suffer in silence” than complain. However, in 2020 this figure dropped. The number of those people identifying as vulnerable also decreased. The report suggests that this may be because of the support measures put in place during the pandemic. Whether these figures change once the support is removed will be interesting to see. I, for one, certainly don’t believe that it is because providers have upped their game and done the right thing in helping vulnerable customers. My 79-year-old mother was told by Sky that “no”, an engineer could not fit her new router and she should get someone to help. Bearing in mind that this was during lockdown, someone coming into the house would actually be breaching guidelines, whereas an engineer would not. Sky was clearly not supporting vulnerable customers in this case.
Consumers showed a keen interest in green credentials and used relevant information when deciding a provider with which to contract. 65% of respondents said it was important for their energy provider to have good green credentials and 56% for telecoms. 44% of consumers said that energy and telecom providers must take green issues more seriously. There is, of course, much work to be done to ensure that the information is accurate in this area too.
The future for telecom and energy providers’ customer service
It remains to be seen if complaints from consumers will start to increase as we get through to the end of the pandemic. There could be a lot of movement in the sector as people become less tolerant or expect better deals and more redress in return for their tolerance. Certainly companies have a long way to go in improving service quality, especially for vulnerable customers. Expectations are likely to rise and providers are unlikely to improve quality in line. So, there should be more input from the regulators OFCOM and OFGEM to ensure that they do more to assist customers, especially those who are vulnerable. Consumers clearly expect resolutions to be quicker, therefore regulatory and approval bodies for ADR providers need to do more to raise standards and shorten these time scales, which were set long before emails were the norm!
It will be interesting to see how the green agenda pans out. Will it continue to grow as a factor in choosing a provider or will consumers make more economic decisions post pandemic?
One thing is for sure, energy and telecom providers need to up their game in customer service!
Further information for consumers
For more help, advice, tips, information and templates buy How to Complain: The Essential Consumer Guide to Getting Refunds, Redress and Results!
The Complaining Cow free support for businesses
It takes 5 times as much to gain a new customer to retain one. So work on turning your customers into superfans who do much of the heavy lifting for you!
Join the Facebook Group Increase Sales through Customer Service: Compassion, Care and Integrity A private group where you can give and get support, advice and share good practice on how to improve customer service.
Free download Customer Service 5 ways to get rave reviews & referrals a few tweaks to your customer service can help you reduce the risk to your company’s reputation, finances and impact on customers and increase sales.
The Complaining Cow Services
To see how The Complaining Cow can help you improve your customer service see Services.