Regardless of your industry or services, customers may express their praise or criticism towards your business from time to time. This may be concerning their experience with your product or service, a specific engagement event, a technology issue, or even a 3rd party process failure.
Time and time again, we see businesses take compliments or praise of individual services as sound bites, often communicated around the business or even publicly, leveraging the positive customer experience as a testimonial.
Companies will go so far as to award individuals recognised by a customer service event, demonstrating to other staff an example of behaviour they should emulate.
But not complaints.
Complaints are the poor cousin of customer feedback.
We don’t want to be represented, take ownership, and often will not acknowledge a customer complaint. We deem this an anomaly in the customer journey, bespoke, infrequent, and a shame that should be handled and forgotten. Let’s move on. That was a one-off and unlikely occurrence that was bad luck or possibly the customer’s fault. The customers’ expectations were just too high.
This type of attitude is all too familiar in business.
We are not suggesting any company has a perfect customer service performance record. Still, when it comes to managing negative feedback, there is a massive gap between a typical business response and the actions of customer-centric organisations.
We have discovered that many businesses are so disconnected from their customers they frequently are unaware when a complaint has been made. Typically in social media posts. Unfortunately, this leads us to a truth about most businesses regarding customer complaints – they don’t learn from them. And this is the true failure in the customer experience.
‘94% of customers don’t complain; they just leave.’ Kolsky.
Customers that do complain are a fraction of the actual customers who could complain. This can be as high as 19 in 20 customers. Suggesting that if you ignore a customer complaint, you could be ignoring the issues of 19 other customers. By disregarding customers’ needs who complain and not considering the bigger problem, a business can significantly damage their customer experience programs and create significant customer churn in the long run.
Companies that understand the value of complaints as feedback and take ownership for complaint handling have more respected brands, stronger customer loyalty, and significantly less churn than those that don’t.
The irony of complaint handling
While most of the time, a customer may be neutral about your business and services, especially when things ‘just work’, a company can expect that customer satisfaction can lift if a complaint is managed effectively. It is even possible that customer satisfaction is higher post a complaint than before an issue occurred.
Generally speaking, this can be down to a company’s responsiveness to a given complaint. Acting and responding to the issue immediately or communicating the status often can make a customer feel heard and gain trust that their case will be resolved.
Businesses give lame excuses for delays in response time. “It’s not my department.” “I will need to check with accounts.” “No one has complained about a problem before.” Are all too common actions of businesses.
A direct and timely response to customer complaints will be the most effective way of retaining customers. A direct response shows that you are paying attention to your customers, and an immediate response shows how much you value their relationship with your organisation.
In short, the processes by which an organisation captures and acts on customer complaints can determine its effectiveness at meeting customer needs and improving engagement.
It has an instrumental effect on a company’s NPS score. According to the Harvard Business Review, when actively responding to customers, you can significantly lift NPS. A recent article has suggested that ‘these effects held up for at least six months after the interaction, suggesting some permanence to the positive impact of good service.
This begs the question; in context to feedback data, how effective is your organisation at capturing information on customer complaints?
Customer Complaints are a blessing.
While each complaint should be treated separately, collectively, you have an incredible amount of information that can help you streamline your business practices and accelerate performance.
The long-term capturing of customer data is essential to developing customer insights on your customers’ needs, the shortcomings of your service offering, and gaps in processes. This knowledge helps organisations understand what customers are unhappy about and what they require to meet their needs.
Complaint analysis provides a lens into areas where improvements can be made. In some cases, it can also assist in developing new products or expanding business through diversification or repositioning.
So why not take stock and consider your customer complaint data handling efforts. Perhaps review the following:
Customer interaction points:Where are customers able to express their feedback to your business. In contrast, the most obvious would be mail, phone, email. Consider online touchpoints, social media, and even third-party relationships. Are you asking intermediaries for customer feedback information?
Customer feedback loops:At these given points of customer interaction, consider the data you are collecting—the more detailed, the better. Beyond the apparent customer details, why not provide them with structured questions that consolidate their feedback into topical areas. This will help improve turnaround times and also make future data analysis much more manageable.
Contextual Response Data:Can you see the date of the complaint compared to the resolution date? Did the customer reopen the complaint? Are they repeat complainers? There is insight possible if the right data is collected.
Cohort Analysis:Now that you have some extensive complaint data and long-term transaction activity of these customers, it is time to consider the long-term impact of complaint resolution, timing, and satisfaction. Did resolving the complaint quickly keep the customer relationship? Did some specific complaint types impact churn? How has this group responded in NPS results compared to other customers?
Program Strategy:All this complaint data may add some tactical or strategic changes that could be made to your business to improve underlying issues through service enhancements, product developments, or more effective communication.
This is a good start; you have many options to leverage customer complaints to enhance your business. Why not consider taking some of these ideas and dive into your customer complaint activity to see the blessing for what it truly is?