Asian firms neglect customer service

Sep 29 2010 by Brian Amble Print This Article

Companies in Asia are not putting sufficient emphasis on customer service, according to a new report, with a growing divide opening between what consumers expect and what firms are prepared to provide.

Three-quarters of Asian consumers polled for the report by the Economist Intelligence Unit say that customer service should always be a company's top priority. But over half of the companies surveyed invest in customer service only after development of their core product, while a third say they invest in customer service only when they see a real need.

"The gap between what companies are providing and what consumers say they want is an opportunity," says Sudhir Vadaketh, editor of the report. "As competition in the region intensifies those companies who put more emphasis on customer service should gain an edge."

One reason for the neglect of customer service appears to be that many Asian firms still view price as the most important factor in consumer purchasing decisions. For example, half of the Indonesian firms surveyed feel that their customers are concerned only about price, not service. However, less than a quarter of the Indonesian consumers surveyed agree.

Significantly, these rising consumer expectations appear to be driven by better access to information (particularly via the internet) and by increased competition, not just by income levels, suggesting that expectations and consumer awareness even in lower-income countries will rise quickly. But while there may be more products and services on the market, this is not necessarily leading to better customer service.

However as the report also stresses, there is no one-size fits all approach to successful customer service across Asia. Like products, service needs to be tailored to individual markets and expectations. Yet only about half of the companies surveyed make the effort to differentiate their service to suit local customer profiles in different markets.

For foreign firms operating in Asia, the message is encouraging. When asked if Asian or Western companies provide higher standards of customer service, consumers in Asia are divided, with 26 per cent choosing Asian, 28 per cent choosing Western, and 46 per cent undecided. But only 22 per cent of consumers think foreign companies cannot deliver customer service to the same level as local ones.