Most organizations – even government departments – transact goods or services of one kind or other to someone else. This means most of us are in a sales role to some extent.
Not only that, many organizations have internal customers – fellow employees to whom we need to provide information or tangible material in our daily work. We need to take account of how well we deal with them and how well we fix a poor customer experience.
We all know dissatisfied customers cause an organization to lose business. We’ve all heard startling stories of incompetence and arrogance in dealing with customers. Most of this feedback is anecdotal, but a US survey further proved the impact of poor customer relations.
The customer dissatisfaction survey found that for every 100 retail customers who have a bad experience, the organization is likely to lose around 35 current and potential customers – a strong multiplier effect due to those disgruntled customers telling others of their experience.
The Retail Customer Dissatisfaction Study was conducted by the Wharton Business School at the University of Pennsylvania and the Verde Group. Of the 1,186 US shoppers surveyed, only 6% of shoppers who experienced a problem with a retailer actually contacted the retailer afterwards to register a complaint, but 31% instead told friends, family or colleagues what had happened.
Of the 31% who told about their experience, 8% told one person, another 8% told two people and 6% told six or more people. Even though these shoppers don’t complain to the store, they do share their pain with lots of other people.
Complaints snowball among shoppers who are not directly involved. Almost half (48%) of those surveyed reported avoiding a store in the past because of someone else’s negative experiences.
Among those who encountered a problem themselves, 33% said they would “definitely not” or “probably not” return.
The power of word-of-mouth
This demonstration of the power of word-of-mouth communication creates lessons for us all. This form of communication is literally story telling. And as the story is retold by others, the negativity is embellished and grows at each retelling.
Paula Courtney, President of the Verde Group, said “To make a story worth telling, there has to be some entertainment value, some shock value.”
Why don’t shoppers confront the retailer directly? “If they were really angry, they would complain to management during the store visit or maybe after, but they don’t do that very often,” said Wharton Marketing Professor, Stephen Hoch. “Some people think the problem is going to happen again and they can’t do anything about it. They are resigned to it. But the main reason they don’t complain is it’s too time consuming to get it fixed.”
Indeed, the survey showed that 46% of those who had a problem expected they would definitely or probably experience the same problem in future.
Retailers have historically paid a lot of attention to how to satisfy the customer, but have not done much work on what makes customers dissatisfied. In retail, it’s hard to focus on the dissatisfied because most customers are anonymous, unlike direct marketing or business-to-business relationships. And retailers are reluctant to ask customers their views on what they do wrong because they fear they may be stirring up negative thoughts.
But how can customers complain effectively? We are all very familiar with our experiences in trying to get through by telephone to a live person in a retail or customer-based organization, so picking up the phone to complain isn’t worth the trouble. And writing a letter is time consuming.
What about the internet? Doesn’t the Internet make it easy for everyone to contact the seller? Theoretically. But in practice, big retailers certainly don’t make it easy for visitors to find a complaints area on their website. In fact, you won’t be able to find a “Complaints” section anywhere on the websites of the big retailers. What’s more: the word “complaint” doesn’t exist in the “Help” section on their websites, either. I’ve had a look in the websites of giant US retailers WalMart, Home Depot and Sears, Roebuck. Nothing there. Neither is it in the website of the three biggest Australian retailers: Coles, Woolworths and Myer.
They get coy when it comes to contacting them. All six companies had “Contact us” sections on their home page, but all six required the visitor to dig down to find the “feedback” or “comments” area. WalMart merely has a “Related links” section containing a “Store feedback: Tell us how we’re doing” subsection. They demand your full contact details before you get to the “Your comment” part.
Coles have a “Coles contacts” section. The opportunity to comment comes in the “Customer relations” subsection, but first you have to supply 13 lines of information about yourself before you get to the “Please type your message here” bit. Then they require you to “Submit.” It’s hardly a warm response.
The others are similar. They don’t make it easy for an unhappy customer to complain. Rather, they give a strong impression that they don’t want to know about unhappy customers. If these are successful retailers, who are supposedly on top of customer issues, how do other organizations treat unhappy customers? I strongly suspect they don’t make them feel welcome at all – and don’t learn from the feedback.
You would think the largest retailers in the world would make customer relations a top priority. But no. Since the surveys show there is a strong multiplier effect when unhappy customers tell others about their poor experience, you should be pressuring your senior management to make the complaints or feedback area of your website more accessible and more welcoming, regardless of the size and nature of your organization.
An immediate way to improve is to allow the customer to find the complaints area more easily, ie with fewer clicks. Then when they reach the complaints/feedback page they could enter their message first, getting it off their chest before filling in all the lines of their own contact details. This would help the psychology of the situation.
You could create greater warmth in the customer relationship by offering them an actual contact name on the website instead of an impersonal form. For years, global whitegoods firm, Electrolux, in my country used to get people to call “Mr Jolly” in response to marketing campaigns. This name was code for a sales lead. Perhaps your organization could use a similar name for complainers to contact by email.
And, of course, you could promptly acknowledge their complaint. This is rather obvious, but many organizations ignore the obvious.
Monitoring of complaints is an excellent way to gauge customer attitudes; more attention should be given to these issues.
If someone is motivated enough to complain, they will be motivated enough to tell all their friends, family and work colleagues. If you make complainers feel you have offered them a sympathetic ear, you will stop their migration to your competitors and you will stop them influencing others to migrate away with them.
Complaining via social media is another story in itself – a mass tool, but often it works, as retailers realize they can’t avoid facing an angry or disappointed customer without many others becoming aware of the debacle. Discussion for another article.