Half of 18 – 34 year olds say they are more likely to complain about a product on social media than they were a year ago, according to a survey carried out in the UK for global insurer XL Group, with almost a quarter of 18-34 year olds questioned stating that they had already used social media to make a complaint.
While the majority of complaints are still made through traditional methods – either in person at the place of purchase or through a customer care telephone line – an increased willingness to use social media to complain is echoed across all age groups, with more than a third of all respondents to the survey more likely to use social media to complain to a company than a year ago.
Ed Mitchell, Chief Underwriting Officer - Product Recall at XL Group said: "As people integrate the use of social media into their everyday lives, they are more likely to use these channels to interact with companies and brands. This is great for a company when it is getting "liked" but when things go wrong - a large recall because there is a fault with a product for instance - then a company needs to have the tools and capability to respond – fast. Not doing so can cost a firm the loyalty of its customers and its hard earned reputation."
Mitchell continued: "This is particularly relevant to food and beverage companies, because if they do need to recall a product, the news and negative commentary can spread like wild fire on social media. The survival of the product and the integrity of the brand can hinge on how a company manages and responds in such a situation."
The survey highlights that there is significant room for improvement in the way companies respond to their customers using social media; it found that of those respondents who had complained via social media, 16 % "received no effective response" and others experienced a delayed response.
Mitchell concluded. "Organisations need to be able to respond effectively to issues being raised on social media. That’s why, in partnership with our specialist crisis communications consultants we have developed a social media course specifically aimed at food and beverage companies. Free to our Response XL clients, the course helps companies to join up processes in customer service, marketing and technical functions to ensure that issues from social media can be effectively monitored, escalated and responses managed.
"Companies also need to develop response plans with their insurance company. Recalling 5 million units is one thing, but the loss of consumer confidence and resulting loss of shareholder value can be far more costly. We understand this and wanted our clients to get more than financial risk transfer, so we developed Response XL, which provides all our product recall clients with 24/7 access to our specialist crisis, risk and issues management consultants. In Europe our main media consultant is College Hill."
Julia Johnson, Senior Consultant at College Hill said: "Social media can be a valuable early indicator of a problem and an efficient channel through which to communicate to consumers. But even a small number of complaints or negative comments on social media can have a disproportionate impact on a company. For example a sponsored tweet, recently purchased by a disgruntled airline passenger to complain about the airline losing his luggage, was picked up and reported by the media worldwide.
"Understanding what people are saying about an organisation and its products and being able to respond quickly, will be critical for managing corporate reputation in the future."
Notes to Editors:
The survey on the use of social media by consumers as a communications channel was conducted in the UK by The Leadership Factor. It had 2,013 respondents across all age ranges.
About XL Group plc’s Insurance Operations
XL Group plc’s insurance companies offer property, casualty, professional and specialty insurance products globally. Businesses that are moving the world forward choose XL as their partner. To learn more, visit xlgroup.com/insurance.
About XL Group plc
XL Group plc (NYSE:XL), through its subsidiaries, is a global insurance and reinsurance company providing property, casualty and specialty products to industrial, commercial and professional firms, insurance companies and other enterprises throughout the world. XL is the company clients look to for answers to their most complex risks and to help move their world forward. To learn more, visit xlgroup.com
XL Group is the global brand used by XL Group plc’s insurance and reinsurance subsidiaries.