Friday, March 28, 2008

Bad Customer Service Can Lead to an "Iceberg" That Can Sink Your Business

It’s long been known that poor customer service creates enemies and destroys goodwill. Experts say those who have good customer experiences with a business gain that customer’s repeat business. But if the customer has a bad experience, they tell an average of 10 other people about it, who in turn relay that experience to five others.

That was recently borne out when a friend of mine recently traveled on US Airways to attend a relative’s funeral. Her flight on US Airways was so traumatic that she has become a vocal opponent of the airline.

First, her flight was delayed for hours as she sat in her plane on the tarmac. This was likely to make it impossible for her or any of her fellow passengers to make connecting flights, and when she landed, sure enough, she missed her flight. But instead of promptly correcting the problem with apologies, she was told there was "nothing they could do" and because of the time of day, no other flights were available.

Nearly hysterical with anger, she was forced to stay in an expensive hotel overnight rather than sleep in a big city airport terminal. The following day, she came home, having missed the funeral.
Had this been the end of it, it would be bad enough, but after initially promising to refund the $600 ticket price, airline officials later informed her - by email - that she would not receive a refund, because delays were partly due to "weather problems."

Infuriated, she has literally told everyone she knows (including me) about this incident, and has urged everyone she knows to not fly US Airways in the future. In fact, she has even told strangers about the situation, going over every excruciating detail with them. And she’s found much sympathy. Imagine how bad this is for US Airways if everyone on the flight has done this.
In fact, they may well be doing just that.

Research firm TARP recently conducted a study showing that for every 26 unhappy customers, only one will lodge a formal complaint with a company’s management.

Remembering that dissatisfied customers tell, on average, 10 people, and they in turn tell five others, the magnitude of poor service begins to seem almost catastrophic.

In what TARP calls the "Customer Complaint Iceberg," an average of 1,560 people will hear about at least one of these unhappy customers' experiences.

Now, when you think about the 25 unhappy customers who DIDN’T complain, but still might spread negativity about you poor service, it becomes a near-nightmare scenario for a company.
Reputations are built on goodwill, and goodwill is built with good customer service.

Business owners need to be pro-active about customer satisfaction. They need to actively survey their customers to quickly identify any flaws in their delivery of goods or services, and to quickly correct those problems.

Abbott Public Relations can conduct a Customer Service Audit that will survey your customers and help identify possible problems - before they start complaining to their friends, family and strangers.

Don’t wait for disaster to strike, in the form of an army of angry former customers.

3 comments: The last word in Customer Service said...

Great post.

You might want to try a leading customer service review website where people share reviews with other users and with companies. Companies that are involved with and value customer service read Measuredup to keep up on what people are saying and to be able to improve customer service.

Your disputes could be resolved using MeasuredUp if the company you reviewed reads your review or another consumer could give you advice. When you have good things to say a company could reward you.

It is free and easy to use and your info is private.

I have tried some other sites that are also good but really like this one.

Dixie said...

I received an invitation from US Airways today in my in box telling me they will again give me free drinks. Customer Service means nothing to them.

This makes me laugh out loud. It was okay to rip the travelers off when you were in trouble and thought we had all the money in the world and without a by your leave you reached your hand into my pocket. Now you think competitive is bringing back free drinks because again you want to get my money, so until the next time you decide to reach your hand into my pocket drinks are free. At this point I would much rather pick who I allow to put their hands in my pockets, so I will fly with an airline that from the outset did not see fit to make me pay $40+ dollars to take my luggage, and anywhere from $2 to $5 dollars to have something to drink and oh yes we only take cash from you poor suckers in coach. About the only thing you did not think to charge me for was the air in the cabin and if you could have found a way to do that you would have. Better still you might have found a way to charge me extra if I had to use the oxygen mask because your craft was going down.

Funny now you want my business again, yet all along “those foolish passengers in coach”, who by the way have been keeping your air line afloat, and you are so magnanimous that you will again allow me to have a free drink on your aircraft. I almost have to stop and catch my breath because of your generosity.

I marvel at the audacity you have to think that returning free drinks will make everything ok now and gee………..”you got some stimulus dollars so come fly with us”. In difficult times it is easy to see who really wants your business by the way they conduct theirs.

katty said...

Good customer service is essential for any business to survive in this competitive market and your relationship with your customers will make or break your business.. Retaining the customer depends upon not only giving quality product it depends upon the attitude of the company towards customers.
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