A 5-Point Plan for Making the Most of Customer Complaints
Why isn't it working? How can you fix this? Who can solve my problem?
By the time a customer asks these questions, chances are you've already lost them. Anyone who's wasted time or money trying to right a wrong is less likely to buy from you again and probably won't recommend your brand to others. That's the bad news.
The good news is that every annoyed, pissed-off, impatient query is also a gift. "Most dissatisfied customers will just sulk away from a company and never say what they really think," writes author and small-business consultant Barry Moltz for American Express Open Forum. "Instead, they become a secret detractor of that company and tell thousands of their friends about their bad experience on social media. When a customer says they are dissatisfied, the company gets a chance to fix it and turn them into a more loyal customer."
Answering your customers' questions is the easy part--or at least it should be. After all, you already have the infrastructure in place. Just hear them out, address their concerns, and make them happy. So why do fewer than 10 percent of companies handle service recovery well?
According to the Wall Street Journal, the problem often boils down to poor information flow. "The more negative feedback a customer-service department collects, the more isolated that department becomes, because it doesn't want to be seen by the company at large as a source of friction," write management experts Stefan Michel, David Bowen, and Robert Johnston. "Some companies even create specialist units that can soak up customer complaints and problems with no expectation of feeding this information back to the organization."
The result: Companies aren't effectively learning from their mistakes (or successes), which is the No. 1 way to win back dissatisfied customers.
"Customers have more tolerance for poor service than for poor service recovery," note Michel, Bowen, and Johnston in their article "Making the Most of Customer Complaints." "And if a customer experiences a second failure of the same service, there is no recovery strategy that can work well. In all likelihood, that customer will be lost forever."
They suggest this five-point plan for turning customer complaints into a loyalty and retention strategy:
1. Create a service-logic map that integrates the perspectives of the company's customers, leadership, and employees by answering these questions:
- What the customer is trying to accomplish--and why?
- How the service is produced--and why?
- What the employees are doing to provide the service--and why?
Circle in red the pain points on your map, and make it everyone's job to collaborate on addressing them.
2. Celebrate customer-service recoveries--and the people who made them possible.
"When customer-service employees believe that their goals are in line with the organization's values, they are more willing to exert the extra effort required in a failure-and-recovery situation."
3. Empower employees to solve problems.
The Ritz-Carlton, for example, allows front-desk personnel to credit unhappy customers up to $2,000. If that sounds expensive, consider this: "The high cost of poor service is exactly what makes this system work so well. It forces management to eliminate service failures in the first place."
4. Collect and openly share data.
Log customer complaints in a database that's accessible to all levels of the organization. Don't sweep mistakes away; use them as a syllabus.
5. Tie employee rewards directly to impact.
"A system for measuring customer satisfaction should be devised to help rate employee performance. Salary increases and promotions then should be linked to an employee's achieving certain levels."
This article was originally published at The Build Network.