A Complaining Customer is Your Most Important Customer

They may be complaining because service levels are deteriorating, because the product no longer performs to their expectations, or even because they have heard that one of your competitors are doing things better than you.

The complaining customer is here to stay and knowing how to deal with them is especially crucial in competitive, service-based industries.A recent ‘Cutting Edge’ documentary broadcast on Channel 4 painted a very bleak picture of call centres across the UK, and even suggested that the average Briton spends one day a year on the phone to a service provider. Whilst the programme was undoubtedly guilty of sensationalism, it did underline a key point: customers only get in touch when they have a specific issue to resolve, and as such expect an efficient, prompt response.

A surprisingly high proportion of large, supposedly customer-led organisations do not have a formalised complaint handling system. Indeed, one very well known telecommunications firm recently told me their complaints department could only be contacted via post! The result of such negligence is a row of front-line employees manfully fire fighting against a tirade of unhappy customers, a thankless job at the best of times. What is required is a company-wide commitment to handling complaints in the most timely, professional manner possible.

Some level of customer complaints is inevitable; a famous academic once suggested companies aiming for 0% complaints were ‘chasing the rainbow’s end’. No matter how standardised the product, how consistent the customer service, there will always be a segment of your customer base who simply expect more. Just because we believe a customer complaint to be unreasonable does not mean we should dismiss it out of hand.

So, what happens when a complaint is not handled well, or even worse, the customer doesn’t even bother complaining in the first place? The following gives you an idea of what can result from customer neglect:

• Customers go elsewhere: Even the best performing companies lose between 10 and 30% of their customer base each year; imagine what that figure could be if a complaining customer is simply passed between departments?

• They talk to others about you: On average, a dissatisfied customer tells 10-15 people of their negative experience, each of whom who then tells their friends, and so on. It’s remarkable how many people can develop a negative attitude to a company despite having never used them!

• They won’t come back: Negative experiences are rarely forgotten, especially when they have resulted in financial loss or emotional hardship. Such lapsed customers are likely to look at your future marketing communications with astonishing levels of cynicism: “they never did that when I was with them”.

Now we have established the consequences of not handling customer complaints effectively, we can consider how things should be done. There are a number of basics that every customer will expect: not to wait in a queue or be passed around departments, not to have to repeatedly provide personal details and account numbers, etc. But the key to effective complaint handling is listening: only when we can precisely define the problem can we consider how to remedy it. Therefore all front-line staff need to let the customer guide the conversation and only interrupt when further clarification is needed. It can sometimes be difficult for staff to ‘bite their lip’ if customers are being unnecessarily harsh or aggressive, but the customer will feel a lot better simply by venting their frustration.

Once the nature of the complaint has been understood, careful judgement is required to evaluate its validity. Can we actually fix this problem? Is it really the organisation’s fault? Is it best to accept responsibility anyway? At this point it is worthwhile looking through previous complaint records to look for any precedents: has this problem occurred before and how did we deal with it? The customer will not necessarily expect their complaint to be resolved instantaneously, so don’t be afraid to consult colleagues and then get back to the customer with a decision.

At this point it is all too easy to assume that throwing money at a customer will encourage them to forgive and forget. Sometimes it might, although sometimes the customer will not be contacting you to make a profit. Often a genuine apology (ideally in written form) or a commitment to improve the product/service for future users will suffice. A large part of customers’ evaluations is how seriously the complaint has been taken; if they feel their opinions are valued and will be acted upon their bond with the company increases.

The emotions associated with complaining (anger, upset and even embarrassment) don’t disappear when the act of complaining ends. As a result, some sort of follow-up contact is crucial in maintaining relationships and ensuring any problems have been resolved. Most call centre software should allow customers to be ‘flagged’ for future contact, meaning a follow-up takes little effort from the company but can have a big impact on the customer. We may not always be able to resolve their complaint, but we can at least show that we appreciate their feedback.

What type of people actually complain?

Much academic research has noted that complainers tend to be:

• Better educated (which brings experience and a knowledge of where and how to complain);

• From Western cultures (for example, Chinese customers are less likely to complain because Confucianism encourages them not to vent negative emotions in public);

• Assertive and self-confident;

• Experienced consumers.

A knowledge of who the complainer is can help us manage the process more effectively (for example, an experienced customer may well be familiar with technical jargon, so we can use it to describe the problem). As our customer databases are unlikely to hold such information it is up to the member of staff to quickly decipher the characteristics of the complainer and tailor the communication to their specific needs.

Summary

Handling complaints is never an easy or enjoyable challenge. That said, if management can promote a pro-active approach to dealing with dissatisfied customers then there is every chance such negative situations can be turned into satisfying and memorable encounters for the customer. That’s the same customer that will tell all of their friends about you if you don’t handle their complaint appropriately.

To develop such a pro-active attitude to complaints, companies should:

1.  Not just tolerate complaints, but actively encourage them: Complaints can be uncomfortable, even hostile, encounters and this can lead front-line staff to dread them. However, the customer is the best source of feedback so they should be encouraged that “there is no such thing as a minor irritant”.

2.  Develop suitable avenues for consumers to give feedback: Channels of communication need to move with the times; gone are the days when customers are happy to do things via post! Angry consumers expect a response, and they expect it quickly. Free telephone lines and regularly checked email addresses should be an absolute minimum.

3. Use the Internet: Don’t assume all negative feedback will come directly to you (research suggests up to 60% of dissatisfied consumers don’t complain to the company involved). There are countless consumer awareness websites/blogs out there for disgruntled people to spread news of your mishaps. These provide a ripe source of information that can help you improve future service provision, and will also give you an insight into the weaknesses of your competitors.

4.  Offer the right form of compensation: As we have discussed, not every consumer wants to get money out of you, but some form of tangible gesture shows that you value their custom and feel they had valid grounds to complain. Simple product vouchers can perform this role whilst also encouraging the customer to give your company another go.

5.  Share complaint data with other departments: If a complaint department learns of a product defect, what good is this information if it is not passed on to Production and R&D? Complaint data should be reviewed at senior management level and shared with those who can actually use it. A good complaints department is one which uses customer feedback to improve performance, which could in turn reduce the number of dissatisfied customers. After all, surely prevention is better than cure?

David Hart is a Graduate Tutor at Newcastle Business School at Northumbria University. His role involves a combination of teaching and research towards a PhD qualification: his current research interests include Consumer Complaint Behaviour, Relationship Marketing and the Marketing of Higher Education. David can be contacted via  the Newcastle Business School at Northumbria University  www.northumbria.ac.uk

Author: Jo Robinson