Over half of Britain’s SMEs admit they do not “completely” understand the habits and preferences of their customers
42% of SME decision makers say their business tends to go by “feel” to understand their customers, as opposed to using data and analytics
London, May 28, 2015: Customer relationships are crucial to the growth and success of the nation’s businesses, but a new study reveals that over half of Britain’s SMEs do not “completely” understand the habits and preferences of their customers, with only 45% saying their business understands its customers “very well”. An online YouGov survey, commissioned by First Data Merchant Solutions, questioned over 1000 SME owners and decision makers, finding that over two fifths of SMEs (42%) go by “feel”, rather than using data and analytics to pinpoint the preferences, requirements and dislikes of their shoppers.
Just 23% of respondents said their business understands its customers’ needs very well by using data and analytics to assess their interactions with customers, with almost one fifth of those questioned (18%) saying that they “do their best but find it difficult to keep track”.
Despite the struggles to understand their customers, SMEs fully recognise the importance of customer service with most respondents rating “poor customer service” as a reason that a customer might walk out of a store (69%).
In a parallel online survey of just over 2000 consumers, 73% agreed that poor customer service would be likely to make them walk out a shop without making a purchase. 52% say that a long queue for the till may mean no sale, while over a third (36%) said they would be likely leave the store if it did not accept their chosen payment method. For 66%, being targeted with offers and services that aren’t relevant to them is an off-putting factor, though only 33% of SME decision makers identified this “unwanted cross-sell” as a likely issue.
When SME decision makers were asked what factors they feel would significantly improve their business’ customer relationships, 23% said ‘spending more time gathering detailed customer feedback on our products or services’. 16% said finding a way to capture more data around customer habits.
36% replied that they are “too busy with the day-to-day running of the business” to implement new or improved measures to enhance customer relationships. This is echoed by 21%, who report that there is simply “not enough time.”
Raj Sond, General Manager at First Data Merchant Solutions, comments: “These statistics are a real eye-opener for any business not currently embracing platforms that can collect, manage and analyse the masses of data and knowledge that passes through their business daily. The discrepancy in what consumers particularly dislike in a shopping experience, and what SMEs think their customers dislike, is apparent. If business decision makers are not on the same level of understanding as their customers, this can be detrimental further down the line.”
“With stiff competition from larger retailers and online giants, small business owners must learn from these insights and find ways to really look under the bonnet of their business. If they want to survive in this competitive landscape, SME owners need to implement systems that can harness this knowledge and be used to create unique customer experiences and safeguard the relationships with their shoppers”.
All figures, unless otherwise stated, are from YouGov Plc.
Business Survey: Total sample size was 1,107 senior decision makers from SMEs (i.e. businesses with less than 250 employees). Fieldwork was undertaken between 13th - 17th April 2015. The figures have been weighted and are representative of British business size.
Consumer Survey: Total sample size was 2,012 adults. Fieldwork was undertaken between 14th - 15th April 2015. The figures have been weighted and are representative of all GB adults (aged 18+).
Both surveys were carried out online.
About First Data
First Data is the global leader in payment technology and services solutions. With 23,000 owner-associates and operations in 34 countries, the company provides secure and innovative payment technology and services to more than six million merchants and financial institutions around the world, from small businesses to the world’s largest corporations. Today, businesses in nearly 70 countries trust First Data to secure and process over 2,000 financial transactions per second. First Data’s unparalleled infrastructure and partnerships go “beyond the transaction” with next-generation point-of-sale technology fueled by powerful analytics to detect fraud, gain insights into consumer spending, and strengthen customer loyalty. All day, every day, First Data helps its clients thrive in the evolving world of commerce.
YouGov is the authoritative measure of public opinion and consumer behaviour. They supply a live stream of continuous, accurate data and insight into what people are thinking and doing all over the world, all of the time. YouGov is the most quoted research company in the UK with a panel of over 400,000 members taking part in their surveys. Panel members are sent regular surveys on a range of topics including politics, finance, shopping, brands and more.