Zendesk report identifies millennials as Australia’s most loyal customers

BY Australian Retailers Association
29 January 2020

Businesses have an immediate opportunity to capture millennials’ attention by upping their customer experience, according to Zendesk’s latest Benchmark data.

Zendesk, Inc. recently released the Zendesk Customer Experience Trends Report 2020, which looks at how businesses can drive customer loyalty, what matters most to people when they engage with businesses, and what distinguishes leading
companies from their competitors.

This year’s report identifies millennials as Australia’s most loyal customers, with nine out of ten 18-24 year olds saying they like sticking to their favourite brands. In fact, four out of five stated they go out of their way to buy from their favourite brands, compared to only half of those aged 55 and above.

However, the country’s customer satisfaction levels are at their lowest in five years according to Zendesk’s Benchmark data. Driving loyalty among millennials is imperative for local businesses – they make up almost half of the Australian workforce; and, according to Zendesk customer Afterpay, they represent one out of every three dollars spent in the country.

Building brand loyalty is multi-faceted, but one theme in the research is clear: customer experience (CX) is the secret sauce. Almost three-quarters of respondents identified CX as the most important loyalty driver. This peaks for millennials, with 91% prioritising customer service ahead of price and product/service offering.

While millennials feel loyal to their favourite brands, they are also the most discerning. They are the most likely to cut ties with organisations after just one bad customer experience, with 58% saying they would switch to a company’s competitor after one bad experience, which rises to 91% who would ditch a brand after multiple bad experiences. Only 30% of customers aged 55 and above would make the switch.

Malcolm Koh, Customer Experience Strategist, Zendesk, said, “Millennials have historically received a bad rap when it comes to purchasing behaviour, however our data shows that they are simply misunderstood, and so companies need to look at engaging with millennials differently to how they would other customer groups. From moving to channels millennials prefer to use like Facebook and Twitter, to using forms of communication that feel more conversational such as messaging, companies have an exciting opportunity to build a loyal and high-value customer base, as well as nurture long-term brand advocates. Providing a great customer experience is the best way to attract and retain them. Conversely, failing to keep them happy will see you lose those fans more quickly than any other demographic.”

Furthermore, according to the research, only three hours separates a good customer experience from a bad one. On average, the first reply time that is considered good service – be it a phone call, email or message – is two hours, whereas a response time of five hours is considered bad service. With millennials highly likely to leave a brand after only one bad experience, the pressure is on for businesses to speed up their reply times and provide support channels that enable them to respond to customers within a rapidly decreasing window of time.

New technologies are providing an unparalleled opportunity for businesses to ensure seamless and quick service, especially for millennials. Younger audiences are increasingly enthusiastic about how artificial intelligence (AI) can enhance and improve their experience, and with customer service enquiries resolved using artificial intelligence up 400% in two years, businesses are well-positioned to provide a more personalised, round-the-clock, and scalable service.

Seamless self-service and providing a range of customer service channels were also identified as important factors in standout CX, with 60% of Australian consumers wanting to find the information to solve their query online themselves first. Engaging with consumers over their preferred contact method; sharing recommendations based on their purchase or search history; and giving priority customer service based on the enquiry status or account type are highlighted as ways for businesses to ensure good CX.

“Millennials’ expectations are pretty clear; they want brands to treat them as people, not just a transaction. For brands, this means personalising your communications, ensuring they are seamless and engaging, and are available on the channels that your customers prefer. A consistent, authentic customer experience is now a key driver to your long-term success as a business,” Koh continued.

To learn more about the most important trends in the customer experience industry in 2020 and beyond, go to https://www.zendesk.com/customer-experience-trends/ to download the report and check out the Customer Support Performance Scorecard, a personalised rating to help companies assess their own customer experiences.

Methodology
This report combines data from the Zendesk Benchmark, an index of product usage data from 45,000 companies using Zendesk, with the results of surveys and focus groups gauging the attitudes of customer service managers, customer service agents, and customers from Australia, Brazil, Canada, France, Germany, Japan, Mexico, the Netherlands, the United Kingdom, and the United States.

About Zendesk
The best customer experiences are built with Zendesk. Zendesk is a CRM company that builds support, sales, and customer engagement software designed to foster better customer relationships. From large enterprises to start-ups, we believe
that powerful, innovative customer experience should be within reach for every company, no matter the size, industry or ambition. Zendesk serves more than 150,000 customers across hundreds of industries in over 30 languages. Zendesk is headquartered in Learn more at www.zendesk.com.

 

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ABOUT THE AUTHOR

Australian Retailers Association

Founded in 1903, the Australian Retailers Association (ARA) is Australia’s largest retail association representing Australia’s $310 billion sector, which employs more than 1.2 million people. As the retail industry’s peak representative body, the ARA works to ensure retail success by informing, protecting, advocating, educating and saving money for its 7,500 independent and national retail members throughout Australia. For more information, visit www.retail.org.au or call 1300 368 041.

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