New research from Qualtrics suggests that poor customer experience could cost Australian businesses up to $3.8 billion in lost sales over the holiday period. This figure could rise to $71 billion annually in Australia and $5.8 trillion globally.

According to the study, 54% of Australian consumers reduce spending after a poor customer experience. The sectors most vulnerable to this trend globally are fast food (66%), department stores (65%), online retail (64%), and parcel delivery (56%).

For Australian consumers, the top pain points are communication issues (46%), service delivery (44%), and pricing concerns (39%). Frontline employees, such as retail workers and restaurant servers, often report lower levels of engagement, intent to stay, and inclusion.

Qualtrics Customer Experience Strategist, Ivana Sekanic, commented on the findings, "The holidays are a critical sales period and this year the stakes are higher than ever with cost-of-living pressures expected to impact sales. Customers want to be kept up to date on what's happening with their orders, know brands recognise and understand what they need, and that they can trust they're going to get the product and service they've been promised - and they're rewarding brands that do it well."

In response to these findings, Qualtrics suggests five ways to deliver a great customer and employee experience: ease the pressure on frontline employees, communicate clearly and often, keep promises, stay responsive to customer needs, and exceed expectations where it counts.

Dr Cecelia Herbert, Workplace Behavioural Scientist at Qualtrics, emphasised the importance of focusing on employees, "Frontline employees have the most direct influence on customer experiences, yet these are the people who report the lowest levels of engagement and morale at work. If businesses are depending on strong holiday trading, they must start with employees. Simple fixes that improve their experiences at work can have exponential benefits - cultivating an engaged, high-performing team translates to satisfied, loyal customers who spend more."