Barbara Hohbach
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August 05, 2004
Two-Thirds of U.S. Consumers Would Pay More in Exchange for Better-Valued Services, Accenture Survey Finds

Service and Price Are Key Factors in Americans’ Choice of Service Providers

NEW YORK; Aug. 5, 2004 – Two-thirds of U.S. consumers are willing to pay more for select services in exchange for better service despite lower prices being a primary reason for switching service providers, according to survey findings released today by Accenture.

The survey, which polled 1,000 U.S. adults, was designed to determine the level of customer satisfaction and loyalty across 17 industries. The findings also generated an industry ranking on the basis of general satisfaction levels.

The survey found that nearly two-thirds (65 percent) of the consumers surveyed are willing to pay more for better services from select industries, including managed healthcare, airlines and hotels. However, a relatively small percent of consumers are willing to pay more for any individual service, as 20 percent represented the greatest portion of surveyed consumers who were willing to pay more to any one industry for better service. Not surprisingly, the findings also revealed that U.S. consumers are not willing to pay more for services that are among those with which they are the least satisfied.

In terms of better service, 27 percent of U.S. consumers said they would switch providers to gain access to a live customer service representative rather than use an automated voice response system or Web site -- a reason for switching that was more frequently given by women than men. When asked what factors would lead them to switch providers, 16 percent of the respondents said they wanted more reliable/better service, and 24 percent emphasized lower prices. An advertising message was the least-frequently identified reason for switching service providers.

“Clearly, a correlation exists between the services that consumers value and what they’re willing to pay – not all things are equal, and consumers may be willing to make trade-offs for low-value services,” said John Freeland, global managing partner of Accenture’s Customer Relationship Management practice. “Successful businesses harness the principles of customer relationship management to segment and understand their customers, making convenient, low-cost electronic services available while steering their best customers to more compelling, personalized services.”

The research also generated a customer service industry ranking, based on the percentage of consumers who said they are generally satisfied with the service they receive from industries. Postal services, banks and utilities ranked the highest, with 44 percent, 42 percent and 41 percent of respondents, respectively, stating that they are generally satisfied with the level of service they receive from organizations in these industries. Travel agencies, car rental companies and online retailers ranked the lowest, with only 16 percent, 19 percent and 19 percent of respondents, respectively, being generally satisfied with their service levels.

“As these industries work to improve customer satisfaction, marketers need to research their customer base to mine data that will help them define their best customers, identify revenue opportunities and create services packages with the potential to appeal to consumer segments,” Freeland said. “Targeted marketing packages may help generate higher levels of customer satisfaction, encourage loyalty and generate more revenues from the best customers.”

TNS, on behalf of Accenture, conducted telephone interviews with 1,000 U.S. adults between June 16 and June 22, 2004 to ascertain consumers’ attitudes toward customer service by industry. The 17 industries included in the study were: airlines; banks; cable/satellite TV; car rental companies; government agencies; home telephone service providers; wireless telephone service providers; hotels; Internet service providers; life insurance providers; managed healthcare providers; the postal service; utilities; store-base retailers; online retailers; shipping companies and travel agencies.

About Accenture
Accenture is a global management consulting, technology services and outsourcing company. Committed to delivering innovation, Accenture collaborates with its clients to help them become high-performance businesses and governments. With deep industry and business process expertise, broad global resources and a proven track record, Accenture can mobilize the right people, skills, and technologies to help clients improve their performance. With approximately 95,000 people in 48 countries, the company generated net revenues of US$11.8 billion for the fiscal year ended Aug. 31, 2003. Its home page is