Improve Customer Loyalty by Embracing Customer Complaints

In the Journal of Service Research, one-third of 244 consumers said they’d experienced or witnessed insensitive, disrespectful or rude employee behavior an average of once per month. A recent story from the CBS News affiliate in Atlanta highlighted this finding and concluded that customers are more likely to walk away without saying anything rather than seek out a manager to complain.

A 2010 research study we conducted amongst 1015 respondents had similar findings. For both the Journal of Service Research and our study, the overwhelming reason for complaints is quality of service – regardless of industry. In our study we looked at treatment of staff separately from the quality of service and it came way down in the ranking for formal complaints, thus confirming the findings in the article that people don’t complain formally about rude staff.

However, when we looked at the prompting event for complaints posted via social media, treatment by staff ranked third. Therefore it is much more dangerous because while managers don’t necessarily hear about the problem, people are far more likely to complain about it via social media.

The reason for this is that only 25 percent of people say that it is easy to speak to a manager. As problematic staff behavior goes undetected, a vicious cycle takes shape. Rude behavior pushes customers out the door and into the digital “streets” to spread the word about a company’s poor service.

Another factor to consider is that employees often offer inconsistent customer service, making it difficult for managers to see the whole picture. 62 percent of respondents, for example, said that the quality of customer experience with a particular company “depends on who you speak to,” suggesting overall customer experience varies by employee.

Here are some things you could do to deal with bad customer service and rude staff behavior:

1. Hire the attitude and train the skill.
   One of our contacts, an automotive company, recruited a person for their reception desk that came from a two Michelin star restaurant rather than picking a candidate with industry-relevant experience. The results were outstanding. The employee’s attitude broke the mold in a male-dominated industry characterized by a strong sales focus, high employee turnover and little consideration of customer emotions.
2. Make it easy for customers to reach and talk to managers.
   The Commonwealth Bank of Australia invested A$1m to increase the number of complaints they receive. That’s right: to increase them! The reason is that if you don’t, you would still have the same number of dissatisfied customers, but you would not hear about many of them. Thus they are at risk of attrition and you many never hear about the problem. On the other hand, if you hear about it and handle the complaints well, you can turn these customers from detractors to promoters (i.e., the service failure paradox) and you can charge the cost of handling the complaint back to the department that caused it. That way they will act to fix the root causes for the complaints.
3. Recognize and reward the right behavior.
   Managers must show their commitment to customer experience to staff and spend more time interacting with customers and front-line staff.

Employees know when their coworkers are rude. If the right behavior is recognized, rewarded and promoted, employees will follow the right path and customer loyalty will improve.