Are Gen Z More Tolerant of Bad Customer Service?

Customer Shopping in Clothing Store
Service is selling, or so the saying goes. But is that true for all demographics? According to a recent report from Coveo, customer service is less important for younger customers compared to older generations.

In this article, we’ll dig a little deeper into the findings and their implications with a focus on the retail industry.

Gen Z’s customer service concerns

It goes without saying that customer service impacts everyone. However, findings from Coveo’s report suggest that people from ‘Generation Z’ are a little more tolerant of a bad experience. Commonly shortened to Gen Z, this group typically includes people born from the late 1990s (1997-98) to the early 2010s (around 2012-13).

According to the report, 59% of Gen Z customers would give a brand three chances before abandonment. That figure is much lower for Baby Boomers (aged 60+), with just less than a third (32%) giving brands a third chance.

These two generations sit at either end of the scale, with Generation X and Millennials bridging the gap in terms of their tolerance for bad customer service:

  • Gen Z – 59%
  • Millennials – 49%
  • Generation X – 40%
  • Baby Boomers – 32%

Looking at this sliding scale of tolerance, it seems that the older customers get, the less tolerant they become. One argument is that younger generations are more digitally native, giving them more patience for poor online experiences.

So, does customer service not matter?

Reading these findings, it may seem like customer service is less important if you’re targeting younger consumers. In other words, take your focus off the contact centre and put more resources behind marketing and product development.

However, that could land organisations in a sticky situation. Looking at the survey’s other findings, it’s clear that there are some lines that shouldn’t be crossed – regardless of age.

For example, 43% of Gen Z customers said they would abandon a brand if customer service reps gave them conflicting information. That’s compared to an average of 46% across all age groups. Similarly, 49% of Gen Z customers would go elsewhere if it’s too hard to talk to a real person – just 4% away from the overall average of 53%.

Translation? Gen Z might give brands a couple more chances with one-off mistakes, but they are still ready to up and leave when customer service is consistently poor.

What happens if customer service is bad?

Here’s the problem for organisations trying to get by with substandard customer service – your customers won’t tell you. The majority of respondents in Coveo’s survey (55%) said they never (or rarely) complain about a negative experience. That rises to 60% specifically for Gen Z.

Instead, they’ll simply leave. If you’re finding it hard to retain customers and don’t know why, it might not be your products or prices, but your customer service that’s to blame.

The customer service challenge for retail

One of the most concerning findings for retailers is how consumers ranked industries with the worst customer service. There are some notorious candidates in there – industries that have become synonymous with poor service. Technology providers were rated badly by 27% of customers, health insurance companies by 29% and utility organisations by 33%.

But above all of them were retailers – named by 36% of respondents. Why? It may come down to what’s prioritised by retailers themselves. Service is integral to what’s on offer in many industries, including health insurance, utilities and technology. In contrast, retail is typically focused on the quality and cost of products. As a result, customer service is often an afterthought for retail businesses.

Another factor is the disruption of self-service. Retail alone accounts for a third of the self-service market. With 50.3% of general retail customers saying they’d switch merchants because of a lack of self-service, consumer demand is clearly high.

However, self-service doesn’t necessarily mean good service. Coveo found that 50% of customers would prefer no self-service at all, compared to self-service with a bad experience.

There lies the conundrum for lots of retailers. Many are rushing to implement self-service because of high consumer demand. In doing so, they may be choosing the wrong solutions, which are actually detrimental to customer service. For instance, 46% of customers said they want more intelligent chatbots in Coveo’s report.

Improving customer service in retail

There’s plenty of advice out there for retailers that want to improve their customer service. Some of the best tips include:

  • Improve availability with out of hours support.
  • Give customers a choice of communication methods like phone, email and online chat.
  • Use chatbots to streamline the customer journey, getting customers to the right department or operative.
  • Use personalisation to offer customers the right advice, products and support.
  • Keep customer service consistent across multiple channels and potentially multiple sites too.

Here’s where it gets complicated. As covered in our post on communication in retail, businesses have a number of challenges to contend with:

  • Consumer demand can change very quickly.
  • Retailers have multiple shops plus warehouses, distribution centres and head offices.
  • Retailers require a myriad of technology, from point of sale connectivity to contact centre capabilities with various devices.
  • They also have to factor in data protection regulations like GDPR, CCPA and PCI compliance.

Revolutionise your retail customer service

At Aura, we understand the challenges faced by retailers when it comes to communication and customer service. Fortunately, we offer an arsenal of tools to overcome those issues for Generation Z to Baby Boomers and everyone in between.

Our cloud contact centre solutions bring communications together across multiple touchpoints for a seamless, personalised experience. That includes Operator Connect, which allows retailers to turn Microsoft Teams into a business phone solution for better integration and cost savings. Crucially, it’s all available with support in 145 countries worldwide, so you can assist customers across the globe.

We also have a wealth of expertise in digital workplace solutions, so we can help you choose and deploy the right technology for your needs. Wave goodbye to subpar customer experiences through chatbots or other self-service channels. With our device-as-a-service offering, you can even get the right equipment for your contact centres, offices and stores without up-front costs or long-term commitment.

If you’d like to talk more about retail customer service and how we can help, simply contact our team today.


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