Your Customers: Treat Them Right

Your Customers: Treat Them Right

Customers are the life blood of your company.  They buy your services & tell other potential prospects about what you do.  Your business can not survive with out customers.  So why do so many companies forget this?

What does a customer cost to get?

The cost to finding a customer is high.  It ” costs five times as much to attract a new customer, than to keep an existing one[1]“.  So keeping customers should always be a high priority.  Is the customer always right or a good fit for your company?  Simple answer is NO!  There are times when you have to let a customer go, but they should be the small minority.

So if it costs 5x more to find a customer what are some things you can do to keep your customer?  Complaint Service! This is different then just plain old customer service.

Complaint Service – How to

  1. You should at the very least review your service & product complaints on a quarterly basis.

How many complaints have you had?  Are you seeing a trend up, down or steady?  If you are not tracking these you better start.  You can glean so much out of this data, you’ll learn if there is a trend in the type of complaint.  Is a particular product or service receiving the majority of them.  Is a particular customer the only one complaining? Is a particular employee connected to more then the others and a whole lot more.

  1. Dealing with complaints is next.

Our first impulse is to just “fix it.”  This by far is the worst thing you can do!  You need to contact that customer immediately to find out what they are having a problem with.  Their initial complaint may not even be the root of the problem.  But if you don’t talk to them you will never know.

The customer also wants to know you are listening.  By just fixing it you will give them the impression that you don’t really care that it was a problem in the first place.  Think about it this way, you go to a restaurant order a steak medium rare, and it comes to you rare.  You tell the waiter that and he snatches it away, returns 10 minutes later with shoe leather.  Assuming what you really meant was well done.  The customer never got what they wanted, the problem never got fixed and now they are even more unhappy.

Make sure to listen to your customer and then address it in a way that say’s we appreciate your business.  This will strengthen your business relationship more then just doing what is expected.

  1. Making sense of the data you collect.

Trends: If you are starting to see an up tick in complaints from month to month you need to realize something has changed.  Identifying that is critical to dealing with it.

Particular Product or Service: If the a trend is one product or service you need to look closely at why.  Has a process changed?  Are you having issues with your vendors?  Has a key employee moved up or out?  If up can they be tapped to mentor the person who took over?  If out did they do something at the end of their employment?  These questions are important to answer so you can deal with it as fast as possible.  Ignoring it will not magically fix it.

Same complaint from many customers: At least this will be a giant red flag for you.  You’ll know it is not just the fussy customer complaining again.  But each customer will need to be treated individually and they may result in different ways of satisfying them.  But be careful your customers may know each other and talk.  So each resolution should not be to different.

  1. Have procedures in place to deal with customer complaints

If you have a process in place to deal with a customer’s complaint then it will be a lot easier to contact them and deal with the issue.  You won’t be flying by the seat of your pants.  It will also give your employees a known way to deal with the level of issues they should.  They will know when it is “past their pay grade” and kick it up to the next level quickly.

Empowering your employees to fix their own mistakes will allow them to learn from them.  Let’s face it as a manager part of your job is to fix your employee goof ups.  But doesn’t it make sense to allow them to fix the smaller things before bringing it straight to you.  If you don’t let them fix it you will be to busy putting out fires to do anything else.  Just make sure they know the boundaries up front and have a easy way to document the problem.

Some statistics

According to Len Markidan’s article 22 Customer Support Statistics That You Absolutely Need to Know[2]  a happy customer will tell on average 9 people and an unhappy one will tell 16.  Almost a 2:1 ratio.  Also, he found that one complaint actually represents 26 you are not aware of.

At that ratio and with all the people one complaint represents 1,400 people have heard about the bad service to 9 who have heard about the good.  Granted if you are providing good service the word gets around pretty fast.  So making sure your customer is more then satisfied does pay for itself.

In the same article he demonstrates that selling to an existing customer is twice as likely.  Up selling to a existing customer is a lot easier then to a prospect.  Retaining your customers can have a huge impact on profits, a 5% increase of retention can result in 95% increase in profit.

Service Pays

Prospects & Customers will pay more for good customer service.  Since most of us are not the only game in town we need to make sure our customers value our company.  With that intrinsic value you can charge more for what you do.

Wegmans is a great example of high quality service and higher prices.  Wegmans is a retail grocery store based in Rochester, NY.  They have spread to the North East and when a store opens in a new market area there are literally 1,000’s of people waiting to get inside.  What makes them different is how their stores are perceived by the customer.  They focus on them, make returning things easy and have a high ratio of employees to customers.

If you have not been to a Wegmans it is hard to explain why they just feel different when you are there.  They sell all the same things as most grocery stores but they have little additions that the others don’t.  A pharmacy, flower shop, specialty cheese and a cooking utensil isle with high end products.  All this on average gets the customer to pay more then what their competitors charge.

Their customers are also die hard and they let people know how great they think Wegmans is!  They are also perceived as the leader of their industry and have lot’s of rewards & news articles to prove it.  If you get a chance on your next visit to Wegmans look around and notice how it is different from other grocery stores.  If you go on a Sat. afternoon you’ll also see that it is packed with shoppers and their full carts.

So treat your customers right and until next time get out there and bid!

[1] invsep: Customer Acquisition Vs.Retention Costs – Statistics And Trends

[2] 22 Customer Support Statistics That You Absolutely Need to Know – Len Markidan Feb. 2017