How Much Do Unhappy Customers Cost?

In a recent Harvard Business Review OnPoint article, “Stop Trying to Delight Your Customers,” there were four statistics shared regarding the ripple effect poor customer service has on your business.

• 25% of customers are likely to say something positive about their experience.
• 65% are likely to speak negatively.
• 23% of customers who had a positive service interaction told 10 or more people about it.
• 48% of customers who had negative experiences told 10 or more others.

(Harvard Business Review OnPoint article by Matthew Dixon, Karen Freeman and Nicholas Toman)

The moral of the story (in my opinion):

• Unhappy customers talk more than happy customers.
• Unhappy customers do not do your business any good.
• Unhappy customers are bad for your business.

If I were to recommend a quick, one-step solution to this problem – it would be simple: don’t let your unhappy customers leave unhappy.

So what do I mean by this? Well, three things really – all of which will do wonders for the quality of your customer’s experience.

1. Request their feedback immediately. If you wait a few days before sending a customer service survey, you are increasing the lapse of time they have to spread the word about the experience that spoiled their day. So talk to them before they leave the building, before they put down the phone, and before they refuse to participate in a process they’ve decided they have no time to do. The quicker you understand what’s gone wrong, the better your chances are at redeeming the relationship with your customer.

2. Make the last customer touch point memorable. Customers come in contact with various staff, systems and services while in your building or on your site, so make sure that the very last thing they experience is incredibly positive. I’m not suggesting that one good memory can undo a poor experience, but research has indicated that what people remember has a greater impact on them than what people experience (research by Daniel Kahneman), so don’t bypass the opportunity to leave things on a positive note.

3. As much as you are able, fix the problem as soon as the customer communicates the issue. This may sound similar to #1, but the difference is that #1 is about creating an opportunity for customers to give you feedback immediately – it’s about catching their unhappy criticism quickly. This step is about identifying the solution and taking action to solve the problem. Too many businesses tell their customers “We’ll call you when we have an update,” or “We’ll know more about the issue in two weeks,” or “We’ll have an inventory update once we hear from headquarters.” Some of these justifications can’t be avoided – but the goal, when possible, is to solve things on-site. Don’t delay solutions when you don’t have to – to a customer, all issues are urgent. Show them you take them seriously by doing something about it right now.

Don’t ignore, avoid or bypass customers’ concerns – approach them immediately to take action-orientated steps that communicate they are a priority. This will minimize the amount of damage they can do – to your reputation and your bottom line.