Customer service complaints rise to record level; triggered by product and service issues, UKCSI shows

The number of UK customer complaints has hit its highest ever level, rising from 11% to 13%, according to the UK Customer Satisfaction Index (UKCSI). The Institute of Customer Service, which has run the Index since 2008, attributes this increase to the impact of Covid on product availability and reliability. 

The twice-annual survey, which polls 10,000 consumers to track the effects of customer service on business performance, found that despite average customer satisfaction rising by 1.0 points to 81.5, 10.8% of customers have experienced problems with a Retail brand’s service in the past six months, the highest ever level in this sector.

As the nation continues to deal with supply chain and resource challenges, in a volatile financial environment, the research also shows that consumers are experiencing fewer problems with staff (attitude and competence) and more problems with availability, suitability, and quality/reliability of goods and services, compared to 12 months ago.

In January 2021, over 50% of the top 50 organisations were from the Retail or Leisure sectors but in January 2022 this has dropped to 33%. The number of Retail organisations in the top 50 has dropped from 17 in January 2021 to 11 in January 2022. 

Commenting on the report Jo Causon, CEO at The Institute of Customer Service, said: “The latest UKCSI results demonstrate the complexities of the current environment, with relationships between brands and customers becoming increasingly challenging. There is no easy remedy for rising prices and shortages of goods, so we must all become better at dealing with delays and disappointments. Although satisfaction with complaint handling and overall satisfaction has improved, we need to address wider service chain issues if we are to improve the nation’s performance and productivity.

In a climate of falling sales in the Retail Food sector, customer satisfaction has helped organisations protect market share. Companies whose customer satisfaction was at least one point below the sector average experienced a 4.4% average fall in sales, compared to a 2.9% decline for companies with a level of customer satisfaction at least one point above the sector average. 

The Institute of Customer Service is calling on organisations to address their service offering to aid the nation’s economic recovery. Strong financial performance from the UKCSI top 10 reflects the impact of customer satisfaction on market share. 

Causon continues: “More customers than ever before are willing to pay a premium for quality service. This suggests there is an opportunity to invest in delivering the real value that customers expect and deserve. Those that have made our top 10 make it easy to contact the right person, and build trust that they truly care about their customers. Against the backdrop of a challenging economy, a strong service offering is an increasingly important battleground for brands to differentiate themselves and drive stronger financial performance.”

Katie Thomas, head of the Kearney Consumer Institute, comments on today’s UK Customer Satisfaction Index figures: “Today’s data reflects both how consumers began to return to stores in H2 last year, with e-commerce stabilizing, and the effect ofOmicron when it hit. However, it provides positive indicators for in-store shopping and that some online shopping behaviours may not stick post-pandemic. Consumer emotions are still high. Following a long two years, we’re now dealing with inflation and pricing concerns across categories. 

“But the figures only tell half the story. In many cases consumer habits are confused for loyalty, and achieving true loyalty depends on taking the habits born of routines and injecting an emotional response and consistent satisfaction. In fact, only 18% of UK consumers told the Kearney Consumer Institute that they never or rarely buy a different brand from one they are loyal to. 37% will purchase a competitive brand if their primary is out of stock – showing the sticky impact the supply chain and stock issues have had on the consumer.

“While not yet reflected in the data, we anticipate increased price sensitivity in coming months and more traditional recessionary behaviours, such as trying less expensive products and continuing to consolidate store trips.”

Retail (food & non-food) organisations in the Top 50 in January 2022 are:

Jan 2022 rankOrganisationJan 2021 rankChange in score Jan-21 to Jan-22
1Pets at Home 73.5
7John Lewis2-0.4
11M&S (food)50.7
17M&S (non-food)3-0.1
29=Home Bargains171.5