September 2008

As the economy tightens and business becomes ever more difficult, you probably think the last thing you need is a customer with a complaint.

However, perverse though it may at first appear, complaints can provide a genuine health check to your business and in doing so may just give you the opportunity to help safeguard your customer base.

Research shows that consumers are reporting that amongst the biggest eroders of their trust and satisfaction with suppliers are a failure to keep promises, the unavailability of staff to take calls and the non return of calls.

The companies most aware of these issues – the ones most likely to come through the current economic problems unscathed – are meeting these challenges head on.  For others, their inability to deal with this issue proactively is perhaps another indication that they may have a very rocky ride ahead of them.

Businesses therefore need to assess whether their strategy to deal with complaints matches their customers’ expectations.  There are a number of key practices that have been adopted by leading companies to handle complaints successfully but there is one absolutely fundamental measure that must be in place for any company committed to easing their customers’ headaches.

Get your customers to complain!

What a bizarre thought!  But again research has shown that less than five per cent of customers who have experienced a problem with a business will ever actually make a complaint.  At face value this might present an image of a business with first class customer service and very happy customers.  However, the damage that it can actually be doing to your company and your business is enormous.

If, on the other hand, you can encourage your customers to voice their complaints, you have a real opportunity to turn them into advocates of your company.  A very high percentage of customers whose complaint is resolved satisfactorily will actively promote your brand for you – possibly because such a resolution is so unusual.

It is therefore essential that you make it easy for customers to complain and don’t follow the recent example of a mobile telephone company who would only accept written complaints from their customers – not very 21st century!

General Motors carried out research into its customer base which highlighted the value that complaining customers can have for a business.

GM discovered that, out of every 100 people who had experienced a problem, 60 didn’t make a complaint.  More disturbingly, however, of those 60 people 54 would defect and only 6 would repurchase. 

Conversely, from the 40 who did complain, 32 repurchased and only 8 defected.  GM’s solution was essentially simple; use technology to open and manage as many communication channels as possible and then encourage customers to complain.  The trick was then to ensure that the complaints were dealt with quickly and efficiently to the customers’ ultimate satisfaction.

We appear to be approaching an uncertain time where the loyalty of a company’s customer base is likely to be even more important than ever.  Complaints from customer s must therefore be accepted and dealt with in a manner which will reassure and encourage them to buy again in the future.

So welcome those complaints – there’s never been a better time!

By David Maloney - Ology Business Coach, Lancaster

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