instituteofcustomerservice.

com

2017

Customer Service Trends

2017
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Customer Service
Trends 2017
During 2016, customer satisfaction improved in most sectors
of the economy. Employee behaviours and attitudes, especially
the ability to deal with problems and complaints, were key
differentiators for the top performing organisations. We
continued to see compelling evidence of the link between
superior customer satisfaction and high levels of trust, loyalty,
recommendation and repurchase.

We found new evidence that an increase in employee

engagement leads to uplift in customer satisfaction. In the
year that gave us the EU referendum, our research showed that
customer satisfaction in the UK is, on average, higher than in
seven other European countries. We enter 2017 at a time of
exceptional uncertainty, creating both risks and opportunities
for many organisations. Here, we examine some of the leading
factors which will shape the customer landscape in 2017 and
beyond.
1) Brexit: three key implications
for customer service

Brexit is set to dominate the political,
economic and business agendas in the
next year and beyond. The outcome of
the UK’s negotiations with the EU and the
emergence of new arrangements will have
profound ramifications across all sectors of
the economy. But what will this mean for
customer service? We have identified three
key implications that are especially relevant.
An increasing need to invest in customer
service skills
Our research has consistently shown that
employee behaviour, competence and attitudes
are key differentiators of the top service
organisations. As the prospect of recruiting
employees from Europe or across the world
becomes less certain, organisations are likely
to increase their focus on upskilling existing
employees and investing in apprenticeships
to identify and develop the potential of future
employees. Being seen as a fair and responsible
employer, offering opportunities to develop
a career and a commitment to high levels of
customer service will become more important in
attracting and retaining skilled customer service
people.
satisfaction and favourable levels of GDP
and employment. There will be a growing
recognition across government and business
that the UK’s capabilities in customer service
are key national asset, vital both for attracting
investment and for UK organisations to secure
global opportunities.
Access to the single market for
services ?
In recent years the UK has run a trade surplus
with the EU in services. Although the Single
Market for services has developed more
slowly than that for goods, the UK’s relatively
strong position for customer service suggests
there are significant opportunities for UK
organisations. We therefore expect that
the terms of the UK’s ability to trade with
EU countries will become an increasingly
important element of the Brexit debate in the
next year.

Growing recognition that customer

service is a national asset

Our recent research1 highlighted that customer

satisfaction in the UK was the highest of eight
countries surveyed and that there appears
to be a relationship between high customer

1 EUCSI: A European Customer Satisfaction Index, Customer Service Trends 2017 3

The Institute of Customer Service, 2016.
 2) The rise of the emotional and the
personal

2016 provided plenty of evidence that big Emotional and personal factors will become
data, surveys and polling data alone don’t more important in customer experiences,
tell the full story. Emotions, values and from the way in which employees interact
highly personal needs and preferences are with customers, to the tone and feel
increasingly powerful factors that influence of communications and the ability for
customers’ choices and decision-making. customers to choose how and when to
Organisations will respond by capturing and interact with an organisation.
acting on customer insight from a broad
range of sources, combining data-driven
analysis with co-creation, greater personal
contact and feedback with both customers
and employees to gain an intuitive, authentic
understanding of evolving needs. Leading
organisations will identify and measure
customers’ emotional commitment and seek
new forms of segmentation that combine
highly personal factors with conventional
metrics of demographics and buying
behaviour.

mployees

4 Customer Service Trends 2017

3) G
 rowing importance of the link
between employee engagement
and customer satisfaction
Employee engagement has become both
more important to business performance
and more challenging to achieve. Our recent
research2 highlighted that customers know
how engaged employees are and that this
influences both customer satisfaction and
buying behaviour. In a competitive and
uncertain economic climate, the business
benefits of employee engagement -
discretionary effort, empathy and connection
with customers, innovation and new ideas,
consistency of performance - are crucial
to sustainable success and will become
even more so as the next 12 months
unfold. At the same time, employees are
less deferential, better informed, have
diverse needs and motivations. In many
organisations, the gap between leaders
and employees - whether in terms of pay or
attitudes - has widened.
2 The Customer Knows : how employee engagement
leads to greater customer satisfaction and loyalty,
The Institute of Customer Service, 2016.
Some leaders and organisations intuitively
know that employee engagement influences
customer satisfaction and business
performance. However, others are sceptical;
or, whilst recognising that engaging
employees is desirable, don’t necessarily see
how this links to business performance. In
some cases, employee engagement has been
largely an HR focus or function. In 2017,
employee engagement will increasingly
be seen as a business asset and critical
differentiator with a definable return on
investment. More organisations will seek to
identify and influence the way that employee
engagement impacts customer experience
and future buying behaviour.
Customer Service Trends 2017 5
4) P
 eople, robots or both: finding
the optimum mix of people
and technology

Our research into the Customer of the

Future3 suggests that organisations will
need the ability to excel and move between
offering fast, efficient transactional service
and empathetic experiences based on
personalised help and advice. Technologies
such as artificial intelligence, sensors and the
Internet of Things are creating the potential
to offer efficient, enhanced and personalised
services. This may lead to a fall in demand
for jobs focused on functional transactions
and a heightened requirement for
applications and experiences that combine
technology with empathetic contact, help
and advice.

For organisations, one of the key challenges

in 2017 will be combining technology and
people-based experiences that delivers
the optimum blend of efficiency and
personalised care. For government, a
key challenge will be to assess the impact
of these technologies and applications
on existing and future employment and
work across sectors to enable the UK’s
education and training institutions to adapt
to organisations and individuals’ evolving
needs.

6 Customer Service Trends 2017 3 The Customer of the Future, The Institute of Customer
Service, 2016.
 5) I n regulated sectors, transparency
will be as important as competition in
driving standards

Regulators in sectors such as Utilities, But if UK regulators and organisations

Banking, Telecommunication and Transport are serious about raising and maintaining
have explored a range of ways to improve excellent standard of service, 2017 is
standards of customer service, including an opportunity to make an unequivocal
greater competition, building service commitment by shining a light on service
incentives into the regulatory framework performance and measuring the aspects of
and increased transparency of customer experience with organisations that are most
service performance. In 2017, there is important to customers.
likely to be a growing momentum for
consistent, independent, visible measures
of performance which give customers,
organisations, government and the media
alike, objective and reliable information
about how organisations perform on key
measures of customer service. This approach
may have its limitations, for example in
evaluating the performance of new entrants.

nd

Customer Service Trends 2017 7

6) Leadership will be judged by
values and doing the right thing

2016 saw an outpouring of anger How leaders act and respond will be critical
and discontent directed at established to earning the trust of customers, employees
institutions. A new term – “post-truth” – and the wider community. Doing the right
entered the lexicon, reflecting a climate in thing, and being seen to be do the right
which the emotional and personal hold sway thing, across a complex range of issues can
over “expert” analysis. Trust in organisations only be achieved through integrity, clear
showed signs of recovery in the UK purpose and a consistent set of values. We
Customer Satisfaction Index, but remains therefore expect 2017 to see a renewed
fragile. The advent of the EU General Data focus on values, integrity and ethical
Protection Regulation gives increased standards as the touchstone for leadership.
profile and focus to standards for managing
customer data. There is a potential tension
between customers’ desire for personalised
experiences and their willingness to trust
and share information with organisations.
As a result, trust will be recognised as an
organisation’s most important asset for
sustainable success. Organisations will be
exposed to scrutiny and held to account on
a wider front than ever before: the quality
of customer service; the way vulnerable
customers are treated; management of
customer data; treating employees with
respect and fairness; the ability to protect
customers’ interests in crisis situations;
transparent governance.

8 Customer Service Trends 2017

7) Proving the ROI of customer
service becomes more critical in
a climate of uncertainty
Economic growth, consumer and business
confidence have proved resilient in recent
months, but as we enter 2017, the outlook
for the UK economy is uncertain. Some see
a wealth of global opportunities for UK
organisations; others fear the consequences
of reduced influence in the European Single
Market. In this climate, it is tempting for
organisations to focus on profit protection
and short term business goals. However,
organisations that see customer service as
a cost centre, rather than as an asset, risk
jeopardising relationships with customers,
partners and employees, to the detriment of
sustainable performance.
It will therefore become more
important than ever for customer
service professionals to demonstrate
the financial return on investing in
improved customer experiences. In
2017, a key focus for The Institute will
be further developing authoritative
evidence of the financial impact of
customer service, strengthening
the case that investing in customer
experience is key to trust, sustainable
performance and long-term success.
Customer Service Trends 2017 9
8) A renewal of relationships
based on respect
Individuals now increasingly have
opportunities to express their concerns,
beliefs and attitudes in more open and
forthright ways. At times, this can create
a climate which feels intimidating. As
we adapt to this new environment of
transparency and directness, there is a
need to redefine how people interact, in
a personal, business and public context. It
will be important to express strong views
and differences of perspective with honesty
and authenticity, whilst showing respect for
others and demonstrating tolerance.
10 Customer Service Trends 2017
In 2017, there will be a renewed sense
that the quality of relationships –
with customers, employees, partners,
suppliers and stakeholders – is the key
to personal and business success and
a decent society. Leaders, stakeholders
and organisations that build and foster
relationships based on respect, and
dialogue from all perspectives, will
be best placed to achieve sustained
customer and employee engagement
and to meet the uncertainty of the
coming year with confidence.
AboutThe Institute of Customer Service Key Activities

The Institute of Customer Service is the UK’s
independent, professional body for customer
service, with over 500 organisational members
and over 5,000 individual members.
Our purpose is to enable organisations to achieve
tangible business benefits through excellent
customer service aligned to their business goals
and to help individuals maximise their career
potential and employability by developing their
customer service skills.
• Research and reports on the latest customer
service trends and thinking
• Publication of the UK Customer Satisfaction
Index (UKCSI) twice a year
• Benchmarking customer experience to identify
areas for improvement, drawing on the views
of both customers and employees
• Bespoke customer insight and research

We provide tools and services to support
continuous customer service improvement and a
framework for our members to share and learn
from each other.
We are independent – setting standards so that
our customers can improve their customers’
experiences and their business performance.
• Training and accreditation programmes for
customer service professionals
• Professional qualifications for individuals at all
stages of their career
• Public policy development.

The Institute is the secretariat for the All Party

Parliamentary Group on Customer Service.

T: 020 7260 2620

E: enquiries@icsmail.co.uk
instituteofcustomerservice.com

Report author: Brian Weston,

Head of Research and Insight

December 2016

Customer Service Trends 2017 11