Home Deep DiveAnalysis Why Indian Companies Are Losing Customers?

Why Indian Companies Are Losing Customers?


Fifty four percent of Indian consumers prefer dealing with human beings over digital channels to solve customer services issues, according to new research from Accenture. The report also found that 88 percent of consumers have switched provider in the past year due to poor customer service, with internet service providers, retailers and banks being the worst offenders. In India, the estimated cost of customers switching due to poor service is $412 billion.

The Accenture Strategy report, ‘Digital Disconnect in Customer Engagement’, is based on the company’s eleventh annual Global Consumer Pulse Research, which gauges the experiences and attitudes of 24,489 consumers around the world about marketing, sales and customer services. 550 Indian consumers were included in the sample.

“Companies have lost sight of the importance of human interaction and often make it too difficult for consumers to get the right level of help and service that they need,” said Raghuram Devarakonda, managing director, Advanced Customer Strategy, Accenture Strategy. “Companies wrongly assume that their digital-only customers are their most profitable, and that customer service is a cost. Consequently they over-invest in digital technologies and channels and lose their most profitable customers – multi-channel customers – who want experiences that cover both digital and traditional channels.”

Human interaction remains a vital component of customer satisfaction, even in the ‘digital age’. 54 percent of Indian consumers prefer dealing with human beings over digital channels to solve customer services issues and get advice (70 percent). Another 63 percent of consumers say they are even willing to pay a higher price for goods and services if it ensures a better level of service.

Physical or in-store experiences are also highly valued amongst consumers. 51 percent agree that in-store service is the best channel for getting a tailored experience, and 49 percent say they are more willing to be sold new or upgraded products when receiving a face-to-face service compared to online. Another 44 percent say they would rather go to a store first than use digital channels to get advice on the best products and services.

“Indian companies have reached a tipping point in their customer’s digital intensity and need to rebalance their digital and traditional customer services investments if they want to improve loyalty, differentiate themselves and drive growth,” added Raghuram Devarakonda. “Companies abandon the human connection at their own risk and are facing the need to rebuild it to deliver the varied and tailored outcomes that customers demand.”

Once a provider loses a customer, 52 percent of consumers will not go back. But there are measures companies can take to hold on to them. 81 percent of ‘switchers’ feel the company could have done something to retain them. 74 percent report that if companies could provide customers with better live or in-person customer service, it would have impacted their decision to switch provider.

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