Singapore, 25 June 2020 (Thursday) – The Institute of Service Excellence (ISE) at the Singapore Management University (SMU) (卓越服务研究院) released the 2020 Customer Satisfaction Index of Singapore (CSISG) survey results for the Info-Communications and Retail sectors today.
The study showed satisfaction with the Info-communications sector dipped by a marginal 1.0% year-on-year to 71.3 points (on a 0 to 100 scale). The study polled some 1,900 subscribers of various info-communications services. Although this decline in customer satisfaction was not statistically significant, it marked the first decline in the CSISG score for the sector since 2014.
The study was conducted between February and April 2020, as Singapore began seeing Covid-19 infections and people began working from home; survey interviews were concluded before Singapore entered its Circuit Breaker phase. As the survey period coincided with the Covid-19 situation, it was not possible to rule out the impact of the pandemic as a driver for the change in scores.
The Info-Communications sector comprised of four constituent sub-sectors: Mobile Telecom, Broadband, Pay TV, and Wireless@SG. Of these, the Mobile Telecom sub-sector registered the biggest dip in customer satisfaction scores, falling 1.4% year-on-year to 71.7 points. The Broadband sub-sector also fell, by 0.8%, to 70.1 points. On the other hand, the Pay TV and the Wireless@SG sub-sectors recorded a 0.5% and 1.1% increase to score 70.6 and 73.9 points, respectively. However, these movements were not considered statistically significant.
The sector’s soft overall performance may be attributed to poorer performance in respondents’ perceived service quality. In particular, the Mobile Telco sub-sector saw its Service Quality score fall significantly, from 78.1 points in 2019 to 75.6 points in 2020, a 3.2% decline.
“An in-depth impact analysis revealed that service-related attributes such as Providing prompt service, Has your best interest at heart, and Makes you feel assured that your needs will be taken care of, were the most important drivers of perceived quality for mobile telco customers,” said Mr Chen Yongchang (陈勇畅), ISE Head of Research and Consulting.
“With the latter two of those attributes registering poorer performance compared to last year, it does suggest the telcos would need to renew their focus in these areas to turn around 2020’s lacklustre performance in customer satisfaction and service quality,” he commented.
Observations of the other dimensions captured in the study also revealed the Broadband sub-sector recording substantially weaker levels of customer loyalty compared to the previous year. The sub-sector’s Loyalty score fell by 5.4% to 68.9 points, compared to 72.8 points from a year ago.
This weakening in the Broadband sub-sector’s Loyalty score was coupled with a marked decrease in the average number of telco services these customers held; the number of services held by a typical Broadband customer fell from an average of 2.4 in 2019 to 1.6 in 2020.
“Analysis has shown that bundling helps customer loyalty,” said Mr Chen. “For instance, a typical telco customer with just one service has an average Loyalty score of 70.7 points. This rises to 72.2 points when the customer has three or more services. In effect, customers with more services are more likely to use even more products and services from the business.
“Therefore, the fall in customers’ average number of telco services held suggests challenges in the service providers’ ability to bundle services and should be an area of concern”, he remarked.
Another key finding was from within the Pay TV sub-sector: Compared to the previous year, researchers observed an appreciably larger proportion of customers that have also subscriptions to video streaming services such as Netflix. In 2019, 11.5% of Pay TV customers indicated they had a subscription to a video streaming service. This rose to 40.7% this year.
Mr Chen commented, “Aside from the suggestion of increasing popularity in over-the-top streaming services among Pay TV subscribers, this segment of respondents also saw lower Customer Loyalty scores year-on-year, with a notable 8.8% decline.”
In the latest set of Retail sector findings from the annual study, researchers found that customers that did online research for information on the product they intended to purchase before making the actual purchase at a physical brick and mortar store, had higher levels of customer loyalty — 13.4% higher. They also spent significantly more at the retail store, compared to customers that did not do any online search for product information.
The study, which polled local customers of department stores, fashion apparel stores, and supermarkets, showed that survey respondents with this type of pre-purchase behaviour, i.e., webrooming, had a Customer Loyalty score of 74.6 points (on a 0 to 100 scale), compared to 65.7 points for respondents that did not engage in webrooming. These respondents were also more likely to repurchase from the retailer.
In addition, webrooming customers were observed to spend substantially more on average. For instance, customers of department stores that indicated webrooming behaviour spent $229 on average; whereas department store customers that did not do online research spent just $81 on average.
“This suggests a powerful potential opportunity for retailers when creating an omnichannel presence. It also dispels the notion that online shopping is a threat to traditional brick and mortar stores,” said Ms Neeta Lachmandas (妮塔.拉切曼达斯), ISE Executive Director (执行总监).
“Aside from the benefits to customer experience and the potential revenue upside, given the challenges posed by the ongoing Covid-19 pandemic, companies can leverage such online webrooming behaviour to offer seamless omnichannel shopping, providing customers with a viable alternative to the physical store experience.
“By proactively engaging customers with a curated online showcase, retailers can shape and value-add to the shopping experience. For example, a shopper looking at a shirt on the web catalogue may also be interested in a matching pair of trousers. Such complementary features are clear benefits to both the customer and business, and is something a well-designed website or mobile app can provide in a timely and accurate manner,” she added.
The 2020 CSISG study of the Retail sector interviewed 2,579 customers from the Department stores, e-Commerce, Fashion Apparels, and Supermarkets sub-sectors. Interviews were conducted through online survey panels, a change from previous years, which employed face-to-face interviews; no year-on-year performance comparisons were made due to this switch in methodology.
Surveys were conducted primarily between February and March 2020. Similar to the study of the Info-communications sector, this occurred as Singapore began seeing Covid-19 infections and people began working from home. While researchers did not find specific evidence that the Covid-19 pandemic affected the survey findings, it was not possible to completely rule out the impact the pandemic had on the study’s findings.
Please refer to Annex A for a background on the CSISG and Annex B for the detailed scores.