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Having a good old moan: Turning customer complaints into a positive experience

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29th Jan 2009
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The British may be known for their dislike of complaining but when they do, firms would do well to listen if they want to improve the customer experience.

By Stuart Lauchlan, news and analysis editor

It's the thing that no company wants to hear, but which truly successful companies regard as one of their most powerful feedback channels – the customer complaint. How better to know what your customers feel about you than by feeding their comments and complaints through to other parts of the organisation? But in reality all too many companies regard complaints as a problem to be dealt with and fobbed off, rather than an invaluable asset to be turned to positive use.

According to a new CMO Council study of some 500 marketing officers, only 16% regularly monitor online forums and message boards to track complaints and pick up feedback. Inevitably, 58% of them protest that they realise that the internet has expanded the expectations of their customers, but the disconnect between this and the lack of feedback monitoring is noticeable - which may explain why only 33% of respondents would claim that their organisations are good at addressing customer complaints and even fewer (31%) rate their company's commitment to listening to the voice of the customer.

"Most organisations and senior marketers suffer from major blind spots and gaps in the way they interact, handle and respond to customer issues or problems."

Donovan Neale-May, executive director, CMO Council

And the bad news goes on and on. Only 36.6% of companies gather customers' insights from customer engagement situations, while just 33% look for ways to turn problems into new sales opportunities. A shockingly low 15% use the opportunity to identify and cultivate potential customer champions and advocates and a mere 23% of companies track or measure customer feedback e-mails. Only 37% gather insights from customer engagement situations.

It's not that marketers don't get the fact that there is a problem here. A hefty 83.3% of respondents said it is either "essential" or "increasingly important" in driving brand advocacy and business performance, while 83.6% said positive customer experiences and word-of-mouth help their brands and businesses grow. And they're aware of what the negative impact can be, with 45.8% admitting that high-profile negative customer experiences had at some time compromised their brands.

Tying in satisfaction

But there's seemingly little incentive within organisations to get to grips with this issue. Some 60% of companies don't tie executive or marketing staff compensation to achieving customer satisfaction and loyalty. Until this attitude shifts, complaints will remain little more than a burden for most firms.

"Customer experience is one of the most critical determinants of brand strength and business growth," points out CMO Council executive director Donovan Neale-May. "Yet, most organisations and senior marketers suffer from major blind spots and gaps in the way they interact, handle and respond to customer issues or problems."

Some respondents argue that they are trying to learn their lesson, with 34.7% claiming that the situation is "getting better." Some 44.8% of respondents say their companies have taken steps to better integrate and analyse customer data while another 38.5% say they have increased personalisation and intimacy in their customer communications. But there's clearly some way to go. "You've got to own it," says Neale-May. "You have to impact customer experience, not just branding. It's all the touch points: call services, service counter reps, warranties, returns.

"You can spend a lot of money creating demand, but if you have that customer disconnect, you're wasting your marketing dollars."

So where do complaints originate? Well, clothes it seems! Statistics from helpline Consumer Direct revealed that complaints regarding women's fashion have soared over the last 12 months - up 22% to 14,390 - the fastest it had seen amongst its top 10 complaints categories.

"The financial pressures and media reaction to the economic downturn will surely have put pressure on financial institutions to look after their customers better than ever."

Robert Crawford, executive director, Institute of Customer Service

But beyond that, presumably the favourite topics of complaint are about banking and broadband? Well, actually, yes! That said, the financial services industy is doing its best to fob off criticism, with customer satisfaction apparently improving within the banking and insurance sectors as both sectors remain in the top half of the table in the latest research from the Institute of Customer Service (ICS).

Remarkably, the banking sector saw a 'satisfaction rise' despite the self-evident collapse of the UK banking sector. "The financial pressures and media reaction to the economic downturn will surely have put pressure on financial institutions to look after their customers better than ever. This rise in customer satisfaction shows that companies are getting serious about service - as they must be - and are taking steps to improve," says ICS executive director Robert Crawford.

"But it's vital that companies realise it's more important than ever now to maintain loyalty and handle complaints efficiently. The financial sector has managed to keep up their service levels but there is still room for improvement."

Three small banks – Smile, First Direct and the Co-operative – did well overall for providing customer satisfaction, while Abbey, Barclays and Halifax languished in the bottom three. In fact, Abbey came bottom in every category, except mortgages where it managed to rally to come second bottom.

First Direct was top with mortgage customers, scoring 90% – 11% more than the runner-up, Yorkshire building society, and was just pushed into second place (with 78%) for savings by the Co-operative Bank (80%).John Lewis and Waitrose scored the highest mark for customer satisfaction with credit cards (90%), followed by Nationwide (87%) and Smile (86%).

Finding the right connection

Meanwhile, the other favourite grumble remains the broadband sector, where the most common causes for complaint are speed and customer service, according to a study by broadband comparison website Broadband Genie. The inclusion of customer service as an issue here is interesting as a recent study by industry watchdog Ofcom did not highlight this in its assessment of the top three problems. Unhelpful customer service made up just 6% of the overall total of main reasons.

"Reading both positive and negative comments left on our broadband comparison website by consumers, good customer service can make or break the customer experience."

Chris Marling, editor, Broadband Genie

"I was surprised to see customer service rank so low in Ofcom's results for main reasons of customer dissatisfaction. In our experience, reading both positive and negative comments left on our broadband comparison website by consumers, good customer service can make or break the customer experience," says Broadband Genie editor Chris Marling.

"Whether a customer is dissatisfied with an ISP's connection, speed, reliability or perceived value for money, a skilled customer service representative can calm the situation and often resolve - or at least adequately explain - a situation."

Broadband Genie analysed data from customer feedback gathered during the same period as Ofcom's speed tests (October to November 2008), focusing on both positive and negative reactions to varying aspects of their broadband experience. As with Ofcom's results, the analysis was carried out across a broad range of ISPs and results of individual providers have not been released.
 

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By aputty
02nd Feb 2009 11:25

I'm very surprised by the number of companies who put customer experience/satisfaction very low or is even on their radar. Retaining customers is very important during this turbulent time. Companies will go bust unless they start realizing this soon. I read somewhere it takes $10 to win a new customer and $1 to retain an existing customer. the ROI is very high for retaining customers.

As for First Direct, I just joined them a year ago, and haven't looked back since. I absolutely love the bank.

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By greatemancipator
06th Feb 2009 21:34

This is the message I've been putting out after two years of research! The British government has made 'avoidable contact' the metric but we don't need metrics we need to encourage and respond to dissatisfaction.

Mick http://greatemancipator.com

PS with Digital Britain in mind, the day I get 2Mb each way I'll celebrate and I live in a city! Ofcom needs to kick BT for a start!

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By BroadbandGenie
30th Jan 2009 09:56

As far as broadband is concerned, the release of Lord Carter's 'Digital Britain' report yesterday and the recent news Ofcom will report detailed speed and satisfaction figures on ISPs in Spring will surely make providers sit up and listen. A universal provision for guaranteed Britain-wide speeds up to 2Mbps is on the table, while Ofcom may give some poorly performing providers a well deserved kick up the backside.

Remember, there is plenty of choice out there - if you are thinking of changing provider, feel free to pop over to our site for an independent look at what's on offer, complete with plenty of reviews by experts and consumers alike, as well as a speed checker and plenty of unbiased news and guides: http://www.broadbandgenie.co.uk

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By malcy
30th Jan 2009 15:22

Re: The point made in the article: Some 60% of companies don't tie executive or marketing staff compensation to achieving customer satisfaction and loyalty. Until this attitude shifts, complaints will remain little more than a burden for most firms.

My company measures customers satisfaction for a number of businesses. Some of the incentivise customer satisfaction and to me, they are the one's with the least sustainable scores. Executives end up cheating the measurement system to achieve bonus. And we end up with forced smiles, forced delivery and a false customer experience.

A Texan friend of mine once told me "A fish stinks from the head" I agree with him. customer satisfaction improvement comes from the top, it comes from passion and it comes from developing a customer focussed culture.

You must not let any barrier get in the way. if people won't do it - fire them - don't incentivise them! (He also used to say "you can't shine a [***]!

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