Consumer Behavior Survey
The Rise of the Cyber Complaint
Dissatisfied customers who don't complain on the spot pose the greatest hidden threat to retailers. But dealing with them isn't easy, because, as a recent CommonWealth Magazine survey shows, no two are exactly alike.
The Rise of the Cyber ComplaintBy Jerry Lai
From CommonWealth Magazine (vol. 426 )
Taiwan's consumers have long quietly accepted shoddy service, poor products and indifferent attitudes, but those days may finally be coming to an end.
A number of factors have conspired to make Taiwanese consumers more willing than ever to voice their dissatisfaction, including growing consumer consciousness and consumer protection laws, says Bei Lien-ti, a professor at National Chengchi University's Department of Business Administration. Also contributing to the trend are the legions of Taiwanese who have traveled overseas and experienced first-hand the large gap in customer service between top foreign retailers and domestic vendors.
Chia-chi Chang, an assistant professor at National Chiao Tung University's Department of Management Science, argues that the growing influence of Western consumerism has changed the mindsets of Taiwan's consumers. This sense of empowerment, combined with the growing presence in Taiwan of foreign big box retailers such as Costco that tout guaranteed customer satisfaction, has been the motivating force behind the country's "new consumer movement."
Aside from outside influences, however, the economic downturn may also be fueling the trend toward more "fussy" customers.
Crystal Lee, marketing manager of polling website EOLembrain Co., Ltd., says she has noticed from "Eastern Integrated Consumer Profile" (E-ICP) surveys over the past three years that consumers are becoming shrewder and more calculating as their purse strings tighten.
To gain a deeper understanding of the psychological changes among Taiwan's consumers, CommonWealth Magazine and EOLembrain jointly conducted an online survey of 1,220 consumers, representing a weighted cross-section of Taiwan's population. The survey analyzed the many variations within the country's increasingly emboldened consumer class.
The Many Faces of ‘Fussy' Customers
Our consumer behavior survey's most notable finding was how different these so-called "fussy customers" were in different age brackets. Consumers in the 40-49 or 50 and above age groups could be described as "rationally resistant customers." When individuals in these age brackets have a bad consumer experience, around 40 percent directly ask for compensation while over 60 percent call the retailer's customer service department to complain. (Table 1) Bei says the numbers reflect older consumers' greater social maturity, stronger self-confidence, and better understanding of how to negotiate with strangers.
In contrast, those 24 years of age or younger in Taiwan tend to speak through their computer mouses. Only around 40 percent are willing to call customer service and file a complaint, compared to over 70 percent in the 50 and older age bracket. (Table 1)
Instead, through cross analysis, the survey found this silent gang of demanding customers uses the power of the Internet to voice dissatisfaction, with 81 percent of survey respondents resorting to blogs, instant messaging services, or chat rooms to make their feelings known. (Table 2)
"Nobody is willing to simply accept they're just unlucky," Bei says. Even if consumers who have a bad experience leave a store without complaining, that does not mean they are not dissatisfied. But rather than venting their frustrations to neighbors as was the case in the past, they now let off steam online, which poses a more serious long-term threat.
Even if a vendor eventually fixes the problem, the complaints remain on the Internet for years and regularly pop up when relevant key words are entered in a search engine, further tarnishing the company's reputation. In the restaurant business, all it takes is one simple critique in one of the many reviews peppering the Internet – "The soup wasn't as good as expected," for example – to sway potential customers browsing the site into staying away from the establishment.
That danger, says National Chiao Tung University's Chang, only heightens the importance of handling problems on the spot in dealing with dissatisfied customers. Statistical surveys show that when consumers have a bad customer experience, they tell between 5 and 23 other people about it, an indication of how lethal complaints can be once they leave the store.
In contrast, when consumers are willing to voice complaints about poor customer service, the process helps them release and get over their frustration and allows them to be more forgiving. Because consumers in the 50-and-above age bracket are more willing to complain directly to the company, as the survey found, they were the only group where fewer than half of the respondents said they would "never shop at the store again" following a bad experience. (Table 1)
"You have to do everything you can to get consumers to express their feelings on the spot," Chang says. Even offering a simple apology tends to make consumers more understanding. But she also reminds retailers that consumers generally have a sense that the company owes them something to begin with, so that even if quiet customers are persuaded to voice a complaint in the store, their sense of entitlement will only grow, requiring an even more sincere response.
The survey found that men tend to be more willing than women to engage in direct confrontation to express their dissatisfaction, such as calling the company to complain, demanding compensation, or reporting the case to the Consumers' Foundation. Women, on the other hand, tend to avoid direct engagements, preferring instead to punish retailers by expressing their negative sentiments on blogs or when talking to friends, or by simply refusing to return to the store. This indicates that retailers must make an extra effort to ascertain the level of satisfaction of their polite female customers.
The survey also discovered clear differences in how people living in northern, central, and southern Taiwan respond to service problems.
EOLembrain's Lee concluded from the survey's results that residents of northern Taiwan are the most willing to speak out and cannot stand waiting too long to pay for what they buy. People in central Taiwan tend to be more forgiving and less likely to react, but they dislike having store attendants give them the hard sell. In the south, people worry most about incorrect price tags, and when they run into a problem, they want the store to make it up to them in a tangible way.
Lai Meng-kuan, an associate professor at National Cheng Kung University's Department of Business Administration, contends that northerners are more likely to directly express their dissatisfaction because of the region's faster pace of life. The more developed commercial environment and the larger number of consumers there also push expectations and demands higher than in other part of the country, Lai says.
Consumers in central Taiwan prefer not to voice their opinions directly because of a cultural emphasis on personal kindness and relationships, leaving them unaccustomed to confronting others, explains Yung-Cheng Shen, an associate professor at Yuan Ze University's Department of Business Administration.
This impenetrable consumer culture makes it more difficult for retailers in central Taiwan to detect flaws in their approach.
The aggressive retail sales tactics to which central Taiwanese are so averse also happen to be the biggest problem consumers throughout all of Taiwan say they encounter in department stores. (Table 3) Vendors must be conscious of this when setting sales targets and pay incentives for the salespeople manning their department store outlets.
In coping with customers who demand tangible forms of compensation, especially those in southern Taiwan, National Chiao Tung University's Chang indicates that based on her research, offering them choices helps reduce their level of dissatisfaction. If, for example, a store offers to either exchange customers' purchases for other items or offer a cash rebate coupon, consumers feel a greater sense of control, which helps dissipate their discontent.
Analyzing consumer behavior based on income, the survey found that the higher consumers' incomes, the more likely they are to see time as money, and the more likely to become impatient if restaurants take a long time to serve them. (Table 5)
The most common problem faced by the highly critical online shopping crowd is when an actual item is at odds with its picture shown on the shopping site. (Table 6) To avoid negative reactions, vendors would be well advised not to overly dress up their sales materials.
In summing up Taiwan's consumers, Consumers' Foundation chairman Tien-jen Hsieh observes that while consumer consciousness is on the rise, the number of truly "troublesome" customers in the country remains limited. He lauds those who are willing to speak out, because only by keeping up the heat will enterprises be kept on their toes and devote more resources and effort to service in their stores and making sure customers stay satisfied after a sale is made.
Translated from the Chinese by Luke Sabatier
About the Survey
In June 2009, CommonWealth Magazine and polling company EOLembrain jointly conducted an online survey of consumer behavior. The survey employed a stratified sampling of people throughout Taiwan 20 years and older, yielding a total of 1,220 valid responses, with a 95 percent level of confidence, and a margin of error of +/- 2.86 percentage points.