Two ways to see a customer complaint are:
- As a negative critique on what your organisation did or didn’t do to be defended or ignored
- As an independent audit of your organisation’s ability to consistently fulfil customer needs.
The first is an emotional response to criticism that reflects the standard fight or flight response humans have when they feel they are being threatened.
The second is an enlightened view that takes the criticism and turns them into positives.
However, there is a third way; a way in which organisations can create positive relationships out of what may otherwise have been a strained or severed relationship.
Customer Service statistics reveal that customers who have complained and had their complaint satisfactorily resolved are more likely to be loyal than customers who have not complained.
Research conducted by Technical Assistance Research Programs (TARP) in the 1970’s and published in 1980 for the US White House office of Consumer Affairs and republished by John Goodman in Competitive Advantage in 1999 after revalidating the data in 20 countries and many industries, revealed:
- 50% of customers who complained, did so to a front line person
- In business-to-business environments, 75% of customers complained to a front line person
- Only 1-5% of customers escalate their complaint to a local manager
- Problems which result in monetary loss have high complaint rates (50-75%)
- Problems which are a result of mistreatment, quality or incompetence have lower complaint rates (5-30%)
- On average, twice as many people are told about a bad experience as a good experience
- 82% of customers who suffered a loss valued at over $100 bought again from the supplier if the problem was resolved quickly
- 54% bought again if the problem was resolved, albeit slowly
- 19% bought again if the problem was not resolved
- 9% bought again of those who never complained in the first place.
- Customers who complain and are satisfied are up to 8% more loyal than if they had no problem at all.
If complaints are not welcome in your organisation, they should be!
Why people complain
When people decide to complain, they complain for one of six general reasons:
- To get acknowledgement that the service was below expectations and poor value and an explanation of why it happened
- To get an apology for the impact on them. Customers usually do not want an apology for the error, even if they ask for it. They want an apology for the impact. If you are going to apologise in response to a complaint, apologise for the impact on the customer not committing the error. e.g. I apologise for the stress the delay has caused you. We will do everything we can to make sure you do not miss your connecting flight
- To fix the problem so that others do not have the same problem
- To genuinely improve the service for themselves and others in the future. They like coming here and don’t want to stop using your service/product.
- They want someone to share their pain and distress. They want someone to “pay” for the poor value they believe they have received
- They want money or goods/services for free to “pay” for the poor value they have received so far.
This is part one of a three-part series on customer feedback and complaints. For the full article, please click here: Customer Feedback: Complaint or Opportunity?