With Christmas fast approaching, new research has found that poor customer service has been letting retailers down, creating a new battleground for competitive advantage. Thirty-eight per cent of Australians were not satisfied with their most recent retail customer service experience and 7 out of ten (71%) have abandoned an online purchase at checkout in the past 12 months amounting to an estimated $3.17 billion in revenue foregone.

The latest LivePerson Customer Conversation Report is based on a survey of 3,012 consumers across Australia (1,004), Japan (1,004), Singapore (502) and New Zealand (502) who were asked about their customer service experiences in 2020, what has changed for them, and what they would like to see companies do differently or better. 

LivePerson found that 63% of Aussies missed retail shopping a lot or a little during COVID-19 and 86% feel that physical storefronts are still important when making retail purchases, but only 48% believe that we’ll be ‘shopping as normal’ by this time next year. In the meantime, 72% say concerns about the virus make them worried about shopping instore and 82% now rate ‘contactless shopping’ as important. 

When asked specifically about their online customer service experiences and why they abandoned purchases at checkout, the results are sobering for retailers:

• 42% have been unhappy with delivery details or options
• 34% want to do more research before making a purchase
• 30% have been unhappy with the price
• 20% have not been able to find everything they need
• 17% have been unable to have simple questions answered easily online.

Commenting on the data, APAC Head of Customer Engagement at LivePerson, Kate Sterling, said that COVID-19 has disrupted the retail sector and increased customer expectations, but in too many cases these aren’t being met.

“Customers now hold much more power. They are more judicious about what they buy, they are buying more online, and they expect their questions to be answered in real time, wherever they are and through whatever channel they prefer.

“Consumers are far more comfortable engaging with brands through new channels than many brands think. They’re already ready. They’re already doing it, and that’s the gap that retailers need to fill in order to gain a competitive advantage.”

When looking beyond the retail sector, 55% of Australians believe the customer service of most companies could be improved. In particular, during the pandemic:

• 35% haven’t been able to find the information they need online
• 27% have been on hold for too long while 19% had their call go answered 
• 25% haven’t been able to get the answers they need

Interestingly, Victorians (who have experienced Australia’s toughest lockdown measures to date) are the most positive about the future of customer service with 47% saying they believe the COVID-19 pandemic will ultimately lead to better retail customer service experience from brands compared to 39% nationally. 

Technology is changing the face of customer service

Another standout finding from the LivePerson research was that the pandemic has accelerated customer adoption of digital tools and technology as part of their shopping experience. 

In fact, only 30% of Australians now prefer ‘in-person’ customer service (regional average was 23%) when they have a question they need answered. When asked what they have become more comfortable with during the pandemic:

• 47% of Australians said shopping online (compared to 54% of New Zealanders)
• 1 in 5 (21%) Australians said using messaging channels to speak to brands (compared to 50% of Singaporeans)
• 18% said speaking with an AI agent (the average across all four countries was 15%)
• 17% said using QR codes (compared to 49% of New Zealanders and 56% of Singaporeans)

Meanwhile, LivePerson’s data shows that Australia continues to lead the world in the shift to ‘conversational commerce’. Brand-customer conversations via messaging channels (such as WhatsApp, SMS and Facebook Messenger) have increased nearly 10% in Australia since May and have more than doubled since the start of the year. The telecommunications sector is leading this trend with messaging conversations now at record levels following 23% growth since May. 

A roadmap out of the crisis

When asked ‘which of the following should retailers provide more of’ people said:

• employing more locally based customer service agents that have local knowledge (41%)
• improving the range of communication channels available (34%)
• providing curb-side pickup options (25%)
• using technology to allow questions to be answered in store by virtual assistants (24%)

“Businesses can’t control the pandemic, but they can improve their approach to customer care. 

“Australian consumers want a mix of physical and digital shopping experiences that prioritise communication, convenience and speed, alongside safety.

“The retailers that will do well this Christmas and, in the years to come, are those who care about customer experience and use technology to augment a personal approach,” Ms Sterling said.

The full LivePerson Customer Conversation Report can be accessed here.

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