Serve or suffer is my word of caution to all businesses that provide customer service. When service is poor or nonexistent it’s doesn’t end well. Consumer advocate Christopher Elliott cites three examples of companies that didn’t listen to their customers and ended up paying the ultimate price.
Ignoring customer service
Prior to US Airways being purchased by America West in 2005, the airline slashed its customer service budget, and outsourced most of those functions. This resulted in the company failing to address many complaints and mishandling others. This angered customers to the point that no amount of cost-cutting could make up for the fact that passengers just didn’t want to do business with them any longer, eventually forcing the airline to file bankruptcy.
Believing customers are wrong
W.T. Grant was an American retail institution for 70 years until 1976 when the company filed for bankruptcy. During the 1960s and 70s, the company failed to recognize that middle-class Americans were moving to the suburbs, but most of its stores were in downtown locations.
The chain responded with marketing gimmicks, such as offering free store credit to everybody. This plan backfired, since Grant’s customers simply wanted to be able to shop close to their suburban homes. W.T. Grant refused to adapt, effectively telling customers they were wrong. When the W.T. Grant bankruptcy was filed it was the second largest in U.S. history.
Exhibiting customer hostility
The third example is Blockbuster, the once dominant video rental chain that shut down half of its stores and then was eventually auctioned off to Dish Network in bankruptcy court. The main reason for Blockbuster’s demise was that video streaming made them dinosaurs and the company refused to adapt.
To hasten their extinction, Blockbuster came to be seen as a giant corporation that charged outrageous sums for late fees and cared little for what its customers wanted the most. Even after Blockbuster attempted to compete directly with Netflix, consumers had decided they didn’t want to give Blockbuster their business.
————-Tell ‘em Gene————
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Whether the economy is performing poorly or booming, smart companies understand that the demand for customer service never declines. These companies are likely to prosper and dominate their competitors.
So if you are a salesperson, sales manager, or the business owner, author and business expert Andy Hanselman offers these suggestions to deal with customer disappointments or get out in front of them.
1. Acknowledge It
A business that acknowledges that it got things wrong and deals with it effectively, can often turn ‘Disappointment’ into ‘Delight’. In other words, just because things go south doesn’t mean you’ve lost that customer. Acknowledging the problem can demonstrate that you actually care, and many will respond positively.
2. Empower For It
The best businesses empower their people to make things right on the spot, without wasting time getting approvals up the food chain. When this approval process is necessary customers typically get angrier and less likely to be mollified.
If your company doesn’t have an empowerment policy, including limitations, often your customers will feel unloved and leave you for someone who will do a better job of care and feeding.
For example, Chick-Fil-A (who by the way hires the best quality people to begin with) teaches all employees a “second mile service.” It simply means doing whatever it takes to keep patrons satisfied and feeling special.
Ritz Carlton Hotels allows every employee the authority to spend up to $2000 to resolve a customer’s problem or deal with a complaint on the spot, without having to get permission from a manager. Now, THAT’s empowerment!
Costco employees are empowered so as to not require a receipt for customers unhappy with a purchase. They also have no time limit for a return, and happily offer exchanges anytime customers prefer that option.
3. Prepare For It
What are the things that typically create disappointment in your customers? Why not get your people together and identify the typical problems and concerns, and then develop ideas and solutions to overcome them. Provide training and put systems and procedures in place to deal with potential disappointment.
4. Look For It
Instead of just having to act like a cat in a litter box and dig out from disappointed customers, get out in front and find them! Frankly, when you are proactive you may even get more complaints than others because your people are basically asking for them. It might seem weird, but the easier you are to complain to, the more customer focused you’re likely to be!
5. Just Deal With It
Now you know it makes sense, so quit hiding in the shadows and deal with it!
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