Imagine losing a key deal because your customer service department couldn't answer a technical question quickly enough. If your business is large enough, imagine this happening dozens of times per day. A recent customer service statistic put a figure to this worst-case scenario: Poor customer service could cost U.S. businesses a staggering $1.9 trillion in consumer spending.
Learning about the pitfalls of bad customer service and how new tech like generative AI builds better customer experiences can help you build a customer-centric brand ready to serve your customers the way they deserve.
Let’s look at some customer service trends and statistics to better understand where the customer experience is and where it’s heading.
Customer service and experience trends are always shifting and changing. As technology continues to advance, so do customer expectations of what constitutes good service. With the widespread adoption of AI-powered chatbots and omnichannel customer support, businesses harnessing these tools are better positioned to retain existing customers — and find new ones.
1. Digital customer interactions skyrocketed by almost 40% globally between June 2017 and July 2020, jumping from 20% to nearly 60% (of total interactions?). (Statista)
2. Self-service is more important than ever: More than a quarter of customers (28%) will give up trying to solve a problem if they can’t find an answer online. (Gartner)
3. Over 87% of executives believe their customers' needs are evolving faster than their companies can adapt, while 64% of consumers wish companies would respond more swiftly to their changing demands. (Accenture)
4. Nearly three-quarters (74%) of online adults report feeling a stronger connection with businesses that offer direct messaging options. (Meta)
5. 71% of young consumers (ages 16-24) value quick responses from customer service for a better experience. (HubSpot)
6. AI is here to help: By 2027, 25% of CIOs are projected to leverage augmented-connected workforce programs to achieve a 50% reduction in time to competency for critical roles. (Gartner)
Because customer experiences are shared quickly and widely, having world-class customer service is a requirement for any business that wants to succeed. As positive customer service increasingly translates to word-of-mouth recommendations and sales, customer service teams are playing a larger role in driving sales and reducing customer churn.
Setting up your customer experience team with the latest tools that empower them to connect with customers and solve their problems quickly can add real value to your business.
7. Almost 84% of consumers value good customer service over everything but price and availability. (Khoros)
8. A recent survey found that nearly 6 in 10 customers (59%) are more likely to recommend a brand to friends due to positive customer service. (Gladly)
9. Over 90% of businesses believe that enhancing customer experience will improve their bottom line. (NTT)
10. Nearly 90% of support teams report a significant increase in customer service demands over the past year. (Intercom)
11. Over 56% of consumers feel like customer experience has gotten worse over time, meaning better CX can truly differentiate your business from the competition. (Customer Contact Week Digital)
Unhappy customers often defect to competitors but also share their negative experiences widely across review sites and social media. This can be a significant deterrent to potential customers at every stage of their sales journey. Regaining lost trust and repairing negative perceptions is an expensive and difficult battle, requiring significant investments in marketing and reputation management.
As more tools allow your company to offer great customer service 24/7, there’s never been a better time to invest in your customers.
12. Nearly 7 in 10 (68%) C-level support executives say customer retention is tougher now compared to last year. (Intercom)
13. Having bad customer service online can hurt in-store sales: 61% of in-store purchases start with online research. (1 World Sync)
14. Customers who have a negative experience are 22% less likely to remain loyal to a brand compared to those who haven't voiced a complaint. (Arizona State University)
15. At least 80% of customers have switched brands because of poor customer experience. (Qualtrics)
Customer service is getting a makeover with AI at the core of many new advances. Conversational AI, powered by chatbots and virtual assistants, provides 24/7 support by answering basic questions, pointing customers to self-service options, and knowing when to escalate complex issues to human agents.
Other AI use cases allow companies to leverage customer service data to personalize CX, analyze feedback to ensure positive interactions, and alert customer service agents to emerging trends much faster than manual analysis. These tools help businesses streamline operations and keep customers happy.
16. AI assistants can tackle over 70% of customer queries, freeing up human agents for more complex issues. (Zowie)
17. Two-thirds (63%) of retailers leverage generative AI to enhance customer service. (Capgemini)
18. The majority (77%) of customer support teams anticipate that AI will push customer expectations for faster response times even higher. (Intercom)
19. At least 66% of customer service professionals report that AI has a positive impact on how their businesses perform. (Dialpad)
20. Using chatbots saves businesses an average of $300,000 per year. (Intercom)
Customers want to connect with businesses on their own terms and through their preferred channels instead of being forced onto outdated or unoptimized channels. They also expect that their previous interactions and conversations with chatbots and human agents will follow them across channels like phone, email, or social media.
With an omnichannel customer service system, you can seamlessly connect your customers to sales, service, and support in a way that personalizes the experience for each customer.
21. Companies lacking omnichannel strategies risk losing a staggering 66% of their customers, with only 33% retention compared to the 89% achieved by omnichannel leaders. (Loyal Guru)
22. Nearly half (43%) of leaders find creating omnichannel experiences challenging, despite rising customer demand. (Forrester)
23. Response time (63%) and resolution speed (57%) are where customers expect the biggest improvements in customer service. (Intercom)
24. As many as 50% of customers say they’d share more information with a company if that translates to a personalized experience. (Forbes)
25. Businesses with omnichannel strategies see a significant boost in foot traffic, with an impressive 80% increase in the number of new customers visiting their physical stores. (Google)
Some of the biggest shifts in customer service are driven by millennial and Gen Z consumers. These digital natives value authenticity and personalization and want brands to build relationships with them. Companies that cling to traditional, impersonal service models risk losing these valuable customers.
As Gen Z surpasses baby boomers to become the largest generation in the U.S., companies need to adapt by offering seamless omnichannel experiences, leveraging social media for engagement, and empowering employees to provide genuine care.
26. By the middle of the next decade, Gen Z consumers could represent nearly 25% of spending across the entire economy. (Visa)
27. Nearly half (44%) of Gen Z and millennial customers who have a bad experience are likely to badmouth the company or product to others. (Gartner)
28. New platforms are important: 56% of Gen Zers and 42% of millennials are reaching out to brands on TikTok and other newer platforms. (Sprout Social)
29. More than 65% of millennials want real-time support of some type. (McKinsey)
30. For Gen Z, email is the champion of customer support channels, with 48% preferring it. (Hiver)
Personalizing customer service can be a game-changer for any company. By tracking customer preferences, purchase history, and past interactions, you can tailor a one-of-a-kind approach for each customer.
Personalization boosts customer retention, as customers are more likely to stick with a brand that caters to their specific needs and builds a relationship with them. With all of the options available to consumers, creating a great customer experience that is unique and helpful makes you stand out from the crowd. These customer service stats show why it's so important.
31. Studies show that personalizing the customer experience can increase sales by 10% to 15%. (McKinsey)
32. Businesses overestimate personalization (85% say they deliver), but only 60% of customers agree. (Twilio)
33. Nearly three-quarters of consumers (71%) want companies to interact with them in a personalized way. (McKinsey)
34. Almost 70% of businesses are increasing their personalization budgets in 2024. (Twilio)
35. As much as 60% to 70% of work could be automated by generative AI using existing technologies, letting agents focus on delivering more personalized service while solving complex problems. (McKinsey)
As you’ve just seen through these customer service statistics, personalized service is a powerful force in creating brand loyalty and generating revenue. By embracing the latest technologies like AI and omnichannel support, prioritizing personalization to build genuine connections, and keeping customer demographics in mind, it’s possible to turn even the most skeptical customer into a brand advocate.
With Customer Service Management through ServiceNow’s ServiceNow AI Platform, you can automate many time- and labor-intensive processes to empower your customer service team to take on more complex and important problems quickly. Your customers benefit from better self-service options and an omnichannel approach that anticipates their needs and directs them to the right people or resources they need, no matter which channels they use.