Customer complaints are inevitable in business. Regardless of product quality, price points and service levels, some customers will complain. At the same time, it may not always be immediately clear to business owners or upper management how the company can more effectively meet the needs of their customers. One approach that some companies overlook is to use customer complaints as a platform for growth at the enterprise level.
Analyzing Complaints to Know Where You Stand
Using customer complaints to influence company decisions presents several problems. First, customers do not have the best interests of the company’s shareholders at heart and will always demand more for less. Second, some customers complain chronically and not every complaint will be indicative of an actual problem. Third, not every identified problem can be resolved in a cost-effective manner. Fourth, customers are involved in unique situations and determining the exact solution for every issue may not always be possible.
Transforming a customer complaint into actionable data requires businesses to aggregate complaints. One or two complaints mean nothing; every company produces occasional lemons and every person has bad days. Instead, the company must collect, categorize, and then analyze large quantities of customer complaints. Making costly decisions from customer anecdotes is not prudent and all decisions should be supported by statistically valid sample sizes.
Identify Problem Areas
Categorizing complaints is important to identifying problem areas in the company. Customer complaints may surround any function that the company performs. Complaints regarding product design, product quality, distribution policies, marketing practices, customer service representatives, or other areas of the company should be logged into distinct groups. Identifying the specific product or person that is the subject of the complaint is also important. This will make it easier to count the number of complaints in a particular area as well as sift through the individual complaints.
Responding to Real Issues
Once a problem area has been identified, it is important for businesses to correct the issue as quickly as possible. This is easier said than done, as a cursory analysis may make it seem that allowing the problem to continue is less expensive than resolving the issue. Companies can easily respond to the complaints of an individual customer and resolve a problem. Implementing a change in manufacturing, quality control processes, or procurement processes is far more difficult.
All managers and business owners should be familiar with the axiom that it costs 10 times more to acquire a new customer than it does to keep an existing one. Ignoring a quality control issue and relying upon a certain threshold of warranty repairs to resolve the issue to correct a manufacturing defect is unwise, as such calculations often fail to take into account such a policy has on customer retention. As a result, calculations into the economic viability of making an important change may indicate a result that harms the company over the long term.
Not every company will need to implement a sophisticated customer complaint logging system to use customer complaints to determine problem areas within the company. Asking customer service managers what problems tend to be discussed, talking to quality control personnel about what they see or discussing product weaknesses with the personnel responsible for returns is a simpler approach to discovering customer complaints. The important aspect is that the company recognize when customer complaints start indicating a systemic problem.
Guest Author: Kelly Kovacic is a paralegal who explores the latest trends that can help businesses stay ahead of their competition. It is important to resolve each customer complaint on a fair and neutral playing field. Partnering with Grapevine will help you satisfy each and every complaint, and most important, it will help keep you aware of the improvements that are needed to keep your business at the top.