Most South African consumers unhappy with brands – report
Insights from a 2023 customer experience survey reveal feelings of disappointment towards brands.
The latest South African Customer Experience report shows increased consumer apathy towards brands.
Based on a survey, by Rogerwilco, of 2 000 customers and 50 business leaders, the report indicates a growing disappointment towards brands that fail to meet customer expectations.
Rogerwilco CEO, Charlie Stewart says the shift in consumer sentiment could be related to general malaise among South Africans – as they deal with the daily effects of infrastructural and economic challenges like load shedding, water outages and inflation
“We no longer have the same level of empathy for brands and instead have developed a striking state of apathy, disempowerment, and disappointment for brands that fail to meet our expectations,” Stewart says.
The nationwide apathy has created a consumer who is accepting that among the brands they shop from, “good enough is good enough”, says Amanda Reekie, founding director at Ovatoyou.
The leaky bucket
Stewart says although consumer expectations have declined, brands are equally responsible.
The marketing specialist says brands are chasing acquisition over retention, channelling their focus towards onboarding new customers than retaining existing ones – which creates a “leaky bucket” syndrome.
He says this could be due to brands feeling the “economic pinch”, and “acquisition trumps retention in terms of business focus”.
Only 14% of 50 businesses which took part in the survey chose retention over acquisition.
“Onboarding a new customer appears easier than keeping an existing one, leading to a cycle of seducing the while losing the current,” says Stewart.
CX consultant Julia Ahlfeldt says it’s baffling to understand why brands continue to prioritise new business when there are “relatively simple” fixes to improve retention.
“If the profit opportunity is so large among existing customers, why are businesses chasing new revenue over retaining long-term customers?” Ahlfeldt asks.
When it comes to customer retention, Stewart considers Yuppiechef as “one of the most iconic South African brands [to ever build] massive rapport with customers”.
He says the company’s hand-written notes added a “human touch” – which still lingers 17 years since inception.
“Where is the next Yuppiechef?” Stewart asks.
“Where are those exceptional brands that delight us and put us – the customer – at the centre of their business?”
“If Jeff Bezos can do it with Amazon, and create a global mega-brand, why can’t our local brands follow suit?”
Speaking up online
Stewart urges consumers to hold brands accountable through online reviews and recommendations.
The report shows that reviews are among the most commonly performed actions online, with 67% of consumers expressing their opinions and complaints through online platforms.
Reekie says online reviews and social media platforms can be empowering, by providing consumers with useful tools “to call brands out if they’re not living up to their promise”.
“Travellers for instance, can view a property’s popularity on booking.com before confirming their stay, or refer to social media to get a sense of what other’s experiences were,” Reekie says.
According to the report, online product research – which includes reviews, recommendations and browsing – impacts purchase decisions to the value of R516 billion, within the R2 trillion retail sector.
The report also reveals the impact of communication amongst consumers, with 59% of customers saying they’d tell friends and family about their negative shopping experiences – 50% confirmed they’d post on social media or review sites.
Acquiring data for data’s sake
Are companies really using consumer data? Only 14% said yes.
The consumer experience report suggests an estimated 2.5 quintillion bytes of consumer data is collected daily. While 57% of consumers are convinced companies use their data to enhance customer experience, Reekie says only few know how to use it.
“There’s a growing disconnect between what businesses do with the data and feedback they collect, and what consumers think they do with it,” says Reekie.
“This creates a false belief among consumers as they’re giving away data, but getting little in return,” she says.
Reekie warns that consumers will eventually stop giving feedback if companies don’t start acting on it to improve consumer experience.
Chatbots or…a fellow human?
Despite the growing use of tech systems by companies to provide customer support services to minimise costs, the survey indicates a strong consumer preference to talk to a human rather than a chatbot, with most saying they’d rather self-serve instead.
Based on the feedback, Ahlfeldt says it’s not surprising that email remains the most popular form of contact, preferred by 24% of consumers – even surpassing call centres (18%). Eight percent of consumers said they’d rather go directly to the store for first resolution – which proves to be the most effective channel.
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Website chats declined from 17% last year to 10% in 2023, while willingness to consult FAQs decreased from 8% to 4% this year.
Ahlfedt says although large-language AI models (LLMs) could soon change the landscape, digitising engagement can cause dehumanisation and loss of empathy.
Better CXs key
Reekie says although tough economic conditions have forced companies to seek more revenue, at the cost of losing existing customers, “the opportunity to impact the bottom line is right under [their] noses”.
“Customers want to be treated as human beings,” Reekie says.
According to the report, customers yearn for a good shopping experiences in-store and offline.
“If they’re not happy, they will tell others about it,” she says.
The CX expert says that customers are no longer as forgiving of brands as they were during Covid.
“They’ve become apathetic and complacent,” Reekie says.
“Accepting that good enough is good enough, instead of great,” she adds.
Reekie says this presents both a threat and opportunity for brands.
“It’s a threat if they continue as is, offering poor experiences which could cause customers to leave,” Reekie says.
Conversely, companies could use this as an opportunity to improve on customer engagement.
Reekie lists some benefits of good CX:
- Influences customer loyalty
- Positive recommendations to others
- Repurchasing / reusing turns everyday users into micro-influencers
“Brands are sitting on a golden opportunity to up their game and offer great – not just good CX,” Reekie concludes.