The growing importance of customer service in the APAC region
While Western markets struggle to recover from the global financial crisis, Asian economies are growing rapidly. APAC consumers are therefore becoming richer, better informed and more widely traveled. This is leading to greater competition for their business- in order to succeed, companies need to enhance customer loyalty.
Excellent customer service delivers the competitive advantage companies are searching for. However, there is currently a gap between the service levels that customers expect and what organizations provide. Bridging this gap would allow firms to differentiate themselves from their competitors, allowing them to potentially become market leaders.
There are four key reasons why firms should increase their emphasis on customer service, across the Asia Pacific region:
Overall lack of investment in customer service. From a consumer point of view, a firm’s top priority should be customer service. However, many organizations prioritize product development ahead of service. By changing their focus, companies that invest in customer service will differentiate themselves from their competitors.
Price is not the only criteria. How Asian consumers make purchasing decisions is becoming more similar to models in the West, where consumers are willing to pay for better service. Therefore, quality is slowly overtaking quantity in the Asian market.
A better informed market. Another factor which is shifting the Asian market is that consumers are becoming more knowledgeable. The rise in online connectivity means the world is becoming more and more intertwined, with more channels used as part of the research and buying process. Therefore consumers are now consulting reviews before buying a product. This means firms need to focus on developing the right consumer awareness.
The growth of foreign firms in the Asian market. A study by the Economist Intelligent Unit found that Asian consumers are divided when asked who provided higher standards of customer services between Western or Asian companies. It also found that there was not a huge gap between Asian and Western firms in terms of the quality of customer service. This shows that Western companies have successfully adapted to the Asian market and there is still room for improvement in customer service from both groups of businesses.