Be an Ethical Entrepreneur, Marketer, and Business Builder

How your business should handle Customer Complaints to turn them into Raving Fans

Oh… You don’t have any customer complaints? Right. I don’t either. This is just for other business owners…  Now that we have that out of the way… Let’s go through our 4 step process for converting complaining customers to raving fans.

This may be the quickest and simple business “fix” I’ve ever discussed and yet may have the greatest impact, so be sure to implement this immediately!

  1. Convince your team to get “on-board” – This step is easy. At your weekly Team Meeting present your team with the number of new customers in the last year who had some sort of previous service experience with your business before purchasing. These would be referrals, current customers making another purchase, leads generated by your service department, or if you have a franchise like me, possibly people who have dealt with your franchise somewhere else. In my business, about 60% of our new sales in 2009 came from people who had heard something about our service. What!? You don’t track your lead sources??? For now you’ll have to guesstimate at this number. Then simply ask your team, “Why are customer complaints bad for us and how many people do you think are affected by each customer complaint?” My team’s answers ranged from 3-30 people. Since I like numbers, they expected me to have an exact number for them. I did not. I just pointed out that even if only 3 people hear about each instance of poor customer service, how many potential new customers are we losing each year? They got the point.
  2. Track Customer Complaints – I don’t care if people are upset you gave them a bad haircut, cheated them out of money with outrageous lawyer fees, think your plumber smelled repulsive, or just doesn’t understand your bills. If the customer is complaining, it’s a complaint. Now that we’ve defined what constitutes a complaint, we need to actually track them. In my office, the same software we use for lead-tracking, scheduling, conversations, and billing has an option to track Customer Complaints along with the contact, time, details, and follow-up person. We can then run reports on all of the complaints by department and/or a time frame.
  3. Address and Fix the problem – All customer complaints should immediately be assigned to someone who can fix the problem. Of course, that person should then fix the problem and update the details of the complaint in your software program. The customer should be notified by telephone about your resolution. Moreover, we address every customer complaint at the weekly Team Meeting in order to keep everyone abreast of poor customer service issues and to come up with ways to prevent issues in the future.
  4. Send a “Thank You” letter – Have you ever been upset at a business? After voicing your dissatisfaction, did you have a few of those companies address and fix your problem? Now, of all of the instances where you actually had your complaint corrected to your satisfaction, have you EVER received a letter afterward thanking you for continuing to be a valued customer??? Me neither. My customers, however, have. It’s a weekly responsibility for one of my office administrators to run a report of the customer complaints, print it out for me to review, and then create “Thank You” letter addressed to each customer. Obviously each letter includes coupons to encourage them to patronize us in the future and almost universally those coupons get used. Can you afford to NOT send those letters and risk losing a long-term paying customer at the cost of $.50 per letter??? As Team Leader, I sign each letter.

Now what about those instances where the complaint isn’t justified, wasn’t our fault, or the customer is quite frankly someone we’d rather not have as a customer any longer? Well whoever takes care of Step 3 should have the foresight to determine that and “resolve” the issue accordingly. I’m a firm believer that not all customers are profitable and certainly don’t want to encourage the customers who suck the life out of my team and I to come back. Moreover, when I review the Customer Complaint report in Step 4, if any are “unjustified” I cross them off the list and so don’t send a letter.

I’ll point this out once again, people who are upset enough about something to complain will tell their friends and family about their dissatisfaction. If you don’t address, resolve, and then follow-up with a “Thank You” letter, your business is undoubtedly losing potential new customers and long-term existing customers.

To your “customer-loyalty” success, Bryan