June 25, 2024

Chief Executive Officer of the Centre for the Promotion of Private Enterprise (CPPE), Dr. Muda Yusuf, has called on insurance and pension operators to prioritise customer satisfaction to increase the efficiency of both sectors.

Yusuf said this in a theme paper, ‘Customer Satisfaction in Deepening Penetration in Insurance and Pension Sectors’, at the seventh edition of BusinessToday Conference held in Lagos.

He said before both sectors could attract more Nigerians, there is a need for operators to treat customers the way they would like to be treated, not the way they think they want to be treated, nothing: “There is the risk of making assumptions about customers’ expectations and developing features and services your customers don’t find valuable.”

Yusuf described excellent customer service as a brand maker, saying, no matter the industry, it helps to develop revenue generation, maintain customer loyalty and improve the overall business strategy.

He said customer expectation is critical to customer satisfaction, and that customer satisfaction is about the ability to meet customers’ expectations.

According to him, 68 per cent of consumers say they are willing to pay more for products and services from a brand known to offer good customer service experiences.

“For 86 per cent, good customer service turns one-time clients into long-term brand champions; 89 per cent of consumers are more likely to make another purchase after a positive customer service experience.

“About 93 per cent of customers are likely to make repeat purchases with companies who offer excellent customer service. If the company’s customer service is excellent, 78 per cent of consumers will do business with them again after a mistake,” Yusuf explained.

He continued: “Increasing customer retention rates by just five per cent can increase profits by between 25 and 95 per cent. Nearly three out of five consumers report that good customer service is vital for them to feel loyalty toward a brand.

“A good customer service experience heavily impacts recommendations. Consumers who rate a company’s service as “good” are 38 per cent more likely to recommend that company.

“Investing in new customers is between five to 25 times more expensive than retaining existing ones while 83 per cent of customers agree that they feel more loyal to brands that respond to and resolve their complaints.”

While warning operators against bad customer experience, Yusuf said: “It takes 12 positive customer experiences to make up for one negative experience.

“About 65 per cent of customers said they have changed to a different brand because of a poor experience. After more than one bad experience, around 80 per cent of consumers say they would rather do business with a competitor.

“Only 20 per cent of consumers will forgive a bad experience at a company whose customer service they rate as “very poor”. Nearly 80 per cent will forgive a bad experience if they rate the service team as “very good” while 78 per cent of customers have backed out of a purchase due to a poor customer experience.”


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