Joined: 13 Dec 2006
Location: Cleveland, OH
|Posted: Dec Sun 17, 2006 2:45 pm Post subject: Customer Satisfaction
The Top 10 Audit Questions: Customer Satisfaction
1. How do we define customer satisfaction?
2. How much should we be spending on retaining customers?
3. Why do customers defect?
4. What report/index/measurable do we need weekly to track our progress in this area?
5. What are the needs that our customers haven't even asked us to fulfill for them?
6. How rapidly are customer questions/problems responded to/solved?
7. Do customer questions/complaints get forwarded to our product/R&D/systems people?
8. Are our customers delighted, or just satisfied?
9. Do our customers brag to their friends about our product or service?
10. If we were a customer, where would we ask the company to improve?
Submitted by Thomas J. Leonard, who can be visited on the web at http://thomasleonard.com/
© 1997, 98, 99, by Coach U, all rights reserved.
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Complaining Customers Are Good For Business
By Bob Leduc
Remember the Coca Cola marketing disaster a few years ago? They tried to switch Coke drinkers to New Coke. It didn't work. Fortunately, the company quickly recognized the problem and had the resources to recover fast. Their follow up research revealed that only 1 unhappy customer in 50 takes time to complain. The other 49 just quietly switch brands. It's human nature to avoid unpleasant experiences like customer complaints. Nobody likes bad news. But uncovering customer complaints and satisfying them can give you a powerful competitive advantage.
Why You Want To Hear Customer Complaints, Dissatisfied customers or clients can do one of 4 things:
1. Remain silent
2. Complain to a legal or public agency
3. Complain to friends and anybody else who will listen
4. Complain to you
Which choice would you like them to make? The best choice may surprise you. You certainly don't want them to complain to a legal or public agency. And you definitely don't want them to complain to their friends and associates. Imagine how much business that can cost you. Remaining silent may seem like the best choice. But it's not, for 2 reasons. First, because it really won't happen. It's human nature for people to talk about their experiences—especially experiences involving emotions like those generated by an unsatisfactory business transaction. The other reason you don't want a dissatisfied customer to remain silent is because it deprives you of the chance to correct the problem and save your relationship with your customer. The best choice is to have your unhappy customer complain to you.
Complaining Customers Are Doing You A Favor
Customers or clients who take the time and trouble to complain to you are doing you a favor. They're helping you grow your business. They're giving you the opportunity to resolve their problem and keep them as a customer. They're also alerting you to a problem that may be costing you business from other prospects and customers without your knowledge. This applies to every business including independent distributors for MLM or network marketing companies. If the problem is in your area of responsibility you can correct it. If the problem is with your company's product or system you can advise them and ask them to correct it. You can also reduce the impact of a company problem on your operation by telling your distributors about it and letting them know the company is taking corrective action.
Encourage Customer Complaints
The Coca Cola Company discovered their New Coke marketing disaster quickly because they print a toll-free consumer information telephone number on all their product packages. The sudden deluge of complaint calls alerted them immediately to the extent of the problem and enabled them to respond fast to minimize the damage. I wonder how long it would have taken them to discover the problem if they didn't provide that telephone number and encourage complaints?
A toll-free consumer information line is one way to encourage customer complaints and feedback. Here are 3 others especially suited to small businesses on a limited budget.* Develop a customer satisfaction and comments form. Include it with products you ship or with correspondence to customers and clients if you don't ship products.
( Send a follow up postcard to customers a week or 10 days after completing a transaction and ask if everything is OK. You can do this by email or telephone if it's appropriate.
( Create a separate page at your website for customer comments and complaints. Publicize the address on your home page and on all communications with your customers. Your customers and clients know your strengths and weaknesses better than you. Get them to identify your weaknesses and tell you what they are so you can correct them. It may be uncomfortable or ego deflating to hear about your weaknesses. But you'll soon forget that when you take corrective action and see the positive impact it has on your bottom line.
Bob Leduc retired from a 30 year career of recruiting sales personnel and developing sales leads. He is now a Sales Consultant. Bob recently wrote a manual for small business owners titled "How to Build Your Small Business Fast With Simple Postcards" and several other publications to help small businesses grow and prosper. For more information write: Bob Leduc, PO Box 33628, Las Vegas, NV 89133
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Something to Think about
A typical business hears from only 4 percent of its dissatisfied customers. The other 96 percent just quietly go away and 91 percent will never come back. That represents a serious financial loss for companies whose people don't know how to treat customers, and a tremendous gain to those that do.
A survey on "Why customers quit" found the following:
3 percent move away
5 percent develop other friendships
9 percent leave for competitive reasons
14 percent are dissatisfied with the product
68 percent quit because of an attitude of indifference toward the customer by the owner, manager, or some employee.
A typical dissatisfied customer will tell eight to ten people about his problem. One in five will tell twenty. It takes twelve positive service incidents to make up for one negative incident. Seven out of ten complaining customers will do business with you again if you resolve the complaint in the favor. If you resolve it on the spot, 95 percent will do business with you again On average, a satisfied complainer will tell five people about the problem and how it was satisfactorily resolved.
The average business spends six times more to attract new customers than it does to keep old ones. Yet customer loyalty is in most cases worth then times the price of a single purchase.
Businesses having low service quality average only a 1 percent return on sales and lose market share at the rate of 2 percent per year. Businesses with high service quality average a 12 percent return on sales, gain market share at the rate of 6 percent per year and charge significantly higher prices.
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Pleasing a Dissatisfied Customer
Give An Angry Customer Even More Than They Ask For
By Azriela Jaffe, © 1999
In late July, my husband, Stephen and I parted with $250.00 of hard-earned cash to get our home air ducts cleaned. Our house was fifteen years old and the heating and ventilating ducts had never been serviced. It had been on the "to-do" list since we purchased the house. When we stumbled across a $50.00 off coupon in Clipper Magazine for a local cleaning service, "Pro Clean Environmental Services," we scheduled the work.
Jeff Lynn, the General manager, was in our home for two hours with all his pipes, hoses and machinery. When he announced that he was done, I wrote him a check for $250.00 and thanked him for his time. Later that evening, my husband, Stephen came storming down the stairs. Stephen is normally a very even-tempered man. One of the few things that really riles him is feeling that he has been ripped off by a service or repair person. Stephen fumed: "What did that guy actually do today?" I replied - "I have no idea. I didn't follow him around the house. He said he cleaned all the ducts."
Well, my detail-oriented and frugal husband had inspected each duct with a flashlight to be sure he was getting good value for his money. Good thing he did! Stephen was furious to discover that the ducts hardly looked any cleaner than before the Pro Clean visit. And, several of the ducts hadn't been touched at all, although we had paid to have all of the ducts in our house cleaned. Since we had paid by check, not credit card, we were vulnerable to being ripped off by an unscrupulous company we knew nothing about.
I called the company the next morning and spoke to Jeff, the man who had done the work. Jeff expressed great surprise and concern, and scheduled a return trip to our home the following day. Jeff could have said, "Too bad. That's the best we can do," since he already had our check. But as we came to learn, Pro Clean knows how to treat a customer. The afternoon Jeff was scheduled to return to our house, a tractor-trailer overturned, spilling 1000 gallons of liquid asphalt on the highway and grinding traffic to a halt. Jeff called me an hour before he was supposed to arrive at my home to warn me that the accident would slow him down and delay his arrival. He had a reasonable excuse to postpone until the following day, but he didn't suggest changing the schedule.
Two and one half hours later, he finally arrived at our house. He had spent most of that time sitting in stopped traffic. My husband had carefully prepared a list of all of the ducts that were in question, but after glancing at the first one, Jeff replied: "We tried a new way of cleaning ducts at the beginning of this week. Obviously it didn't work. I should have caught that before I left and I didn't. I'm sorry. I will reclean every duct in your house."
He continued: "And to make up for the inconvenience, you can call me every year for the rest of the time you are living in this house. As long as I'm still in business, I'll clean your ducts again for free." Jeff's offer was generous and more than we would have asked for, or expected. He proceeded to reclean all the ducts in the house. After the job was done, he thanked me for calling him and telling him of the problem. He then stated: "You are the only customer who called to complain since we started using the new system at the beginning of this week. I'm going to call all of the other customers and alert them to the problem. If they aren't satisfied, I'll go back to their homes and reclean their ducts as well."
Jeff understands how to create a lifetime customer and a book of referrals out of a lost customer. Since ducts are usually cleaned only every two or three years, he could have said to himself: "Why should I go out of my way to make this customer satisfied? They won't be a repeat customer anyway for years, if ever." But Jeff understands the power of both positive, and negative word of mouth. He understands that as a dissatisfied customer, I would have spread the word to my circle of influence to stay far and wide away from his company. I might have even been angry enough to report the incident to the Better Business Bureau.
As a delighted customer, I will likely continue to tell this story about a "duct cleaning business that offered superior customer service." You can't pay for that kind of advertising. The original mistake is largely forgotten and entirely forgiven, replaced by admiration for their approach to remedying the problem.
When you are servicing customers, mistakes will always happen. It's how you respond to them that matters. When treated well, a dissatisfied customer will become your best ambassador.
About the Author: Azriela Jaffe is a syndicated columnist and author of the New book "Starting from No: Ten Strategies to Overcome Your Fear of Rejection and Succeed in Business" and several other self-help books. She welcomes reader response and questions to PO Box 209, Bausman, PA 17504 or firstname.lastname@example.org.