Thursday 7 April 2011

Word of Mouth Is The Strongest Influence On Where Customers Shop


A recent global study found word of mouth is the source of information people use the most (76 percent) and consider most important (56 percent) when deciding whether to do business with a service provider. A US study done this year found word of mouth remained the source of information respondents use most (76 percent) and also consider the most important (56 percent) when deciding whether to do business with a service provider. Social media has “accelerated” the importance of word of mouth.

A 2010 US study reported in the American Express Global Customer Service Barometer study found that over 90% of Australians surveyed in the recent
say they will tell more than three people about a bad customer service experience. Almost 40% of respondents said they would tell more than ten people about a bad experience, and the frightening reality is that a customer’s perception of good service does not match mainstream business thinking.

US research by the Corporate Executive Board in 2010 found 65% of people said they tell others when they have a bad experience and 48% said they tell 10 or more. On the other hand, only 25% said they told others when they have a good experience and 23% told 10 or more.

Another US study mentioned above found that after having a bad customer service experience in the past year, four out of five (80 percent) U.S. consumers told the people around them, while 17 percent shared their bad experiences via social media. Furthermore, 24 percent of consumers consider negative comments posted on social media sites a strong influence on purchasing decisions.

A 2010 US study reported in the American Express Global Customer Service Barometer found 75% of customers will tell others about a good experience and 59% will talk about a bad experience. Stories about good service carry more weight when considering which company to deal with. Eighty-one percent say they are more likely to stay loyal if they have a good experience and 52% say they defect after a bad experience.

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