Creating loyalty is difficult

Nick Gurney and Rob van den Dam
27 Feb 2012
00:00

IBM "Customer first" has been a slogan slavishly promoted by communications service provider (CSP) executives for at least the last five years. So as an industry how are we doing? Based on the results of a recent IBM consumer survey, not very well!

Globally, more than three times as many customers are negative or antagonistic toward their CSP than those who describe themselves as positive or advocates. Less than one in five consumers of communication services are advocates for their CSPs. So, why is "customer first" not delivering? And what should we be doing differently?

Customer attitudes and behaviors are changing faster than the CSPs' ability to adapt its analytical and customer management responses. Consumers' sources of information and experience exchange are now driven by social networks and the internet. They prefer comparison sites and internet searches, recommendations from friends and family and social media rather than traditional CSP sites and channels. In addition, key drivers of advocacy are emotive in nature, again contrasting with current CSP practices that targets rational factors, as borne out by our survey.

The survey results reveal that globally only 18% are advocates, contrasting sharply with industries as retail and banking, where the level of advocacy is twice that of the telecom industry. A majority of customers - some 60% - are antagonistic toward their CSP. In other words, three out of every five customers have negative opinions about their communications providers. These antagonists cost more to support and are prone to speak negatively about their provider through social media, but are typically not telling their CSP about their problems.

The percentage of advocates and antagonists in telecom varies by country (see figure 1). In countries such as Australia, Japan and South Korea, antagonists outnumber advocates by seven times or more. These countries, along with Brazil, have the highest number of antagonists (at 70% and higher). Japan, South Korea and China have the lowest percentage of advocates. While China is among those with the lowest percentage of advocates, it is also among those countries with the lowest number of antagonists.
So with all the emphasis on "customer first," why are advocacy levels so low?

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