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11 Reasons why you better make sure the customer is always right!

Written by: Bob Janet

Article Overview: A customer just left you, or left your store unsatisfied. How many customers did you just lose? One, two because he will tell a friend of his dissatisfaction, three because he will tell 2 friends? Would you believe ten or more?

11 Reasons why you better make sure the customer is always right!

Reason 1: Dissatisfied customers tell an average of ten other people about their bad experience. Twelve percent tell up to twenty people. In very simple terms, bad news spreads rather quickly. Don't think for a moment that your poor performance in servicing your client goes unnoticed. Not only does it not go unnoticed, but also you pay a very dear price for that kind of publicity.

Reason 2: Satisfied customers will tell an average of five people about their positive experience. Conversely, the good news, unfortunately, doesn't spread so quickly. To the contrary, the bad news moves twice as quickly as the good service, they either don't reward it quite as soon or they don't reward it at all. In most cases, customers have come to expect good service as "part of the deal." While they do expect it, rarely do they get it.

Reason 3: It costs five times more money to attract a new customer than to keep an existing one. Before you go out investing hundreds or even thousands of dollars chasing after new clients, think about the money to be made your own backyard. The people that you've done business with previously thought enough of you at some point to buy from you. Why not go back and re-cultivate that relationship? It will cost you one-fifth of the cost of finding a new client.

Reason 4: If 20 customers are dissatisfied with your service, 19 won't bother to tell you. Fourteen of the 20 will simply take their business elsewhere. Most customers just don't want the hassle of having to straighten a problem out. They know, that in many situations, it's their word against the word of the company. Who needs the aggravation? They simply take their business somewhere else.

Reason 5: Up to 90% of dissatisfied customers will not buy from you again, and they won't bother to tell you why. Statistically speaking, you would be lucky if 10% of your unhappy customers would come back and do business with you again. Most customers become dissatisfied when the sales person violates their trust.

Reason 6: 96% of dissatisfied customers do not complain of poor service. They figure, "What's the use? Nobody's listening." Maybe they're not used to getting service after the sale. Many feel they are victims of a crime. The sales person has their commission. Now he or she will simply ignore the pleas of the clients. As a sales or service person, your responsibility is to return calls the same way when a complaint comes in. So when a sale is made, make it clear to the client that you welcome their input and that you would be disappointed if a problem exists that you were unaware of. This permits the client to let you know that they are experiencing a problem.

Reason 7: In many service industries (yours included), quality of service is one of the few variables that can distinguish a business from its competition. In many cases, there's not a nickels worth of difference between the vast majority of products and services that you and your competition offer. The only appreciable difference is in the service rendered by the sales and service people. For 99.9% of your clients, the sales and service people are the company. Most of the time, they are the only people with whom the client will ever be in contact.

Reason 8: Providing high quality service can save your business money. The same skills that lead to increased customer satisfaction also lead to increased employee productivity. You can kill two birds with one stone. The same things that make customers happy make your employees happy. Have your employees put a big smile on their faces. People want to do business with winners. They want to do business with happy people. People don't smile because they're happy, they're happy because they smile.

Reason 9: Customers are willing to pay more to receive better service. You remember… Marketing 101. What do you get when you have a high demand for something and an extremely low supply? The price goes up, of course. The price (in case of service) is the loyalty the client has to you and your firm. If you provide good service, they pay you in loyalty. Loyalty means they will do business with you again. And remember, it only costs one-fifth as much to do business with an existing customer as it does to find a new one.

Reason 10: 95% of dissatisfied customers will become loyal customers again if their complaints are handled well and quickly. Let's face it, people don't want to admit they made a mistake initially when they decided to admit they made a mistake initially when they decided to do business with you. 8% of the decision to purchase is generally made on emotion. Only 20% is made on logic. But they use logic to justify their reason to do business with you. They want to say to themselves that their decision was a right one, a logical one. They are more willing to forgive, if for no other reason than to rectify their initial decision to do business with you.

Reason 11: Good service leads to increase sales. People love to talk about rare experiences, like getting good service from a sales or service representative. Work hard to earn their respect and they will repay you royally by telling their friends and associates.
Now back to the customer that just left unsatisfied. Do you have a lost customer process that automatically kicks in? Ours went something like this: The second a customer left the store dissatisfied we pulled out our Lost Customer Form and answered the following questions.
1. Customers Name, Address, telephone number.
2. The reason the customer was not satisfied.
3. What could have I done on the spot to satisfy the customer?
4. What must I change in our operations to avoid the same situation happening again?
5. What must I do now to save or gain that customer back?

OH, now you are thinking, “We don’t have time to fill out a Lost Customer From. I can give you 11 great reasons why you better take the time. (See above)


Compiled by Bob Janet from research done by Milliken & Company in South Carolina.
Thanks to Michael A. Aun, Aun & Associates, 1-(800)-356-0567 for making information available.

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Article Tags: aggravation, bad experience, bad news, contrary, dissatisfied customers, hassle, money, own backyard, poor performance, publicity, reason 2, reason 3, relationship, sales person, satisfied customers, thousands of dollars, unhappy customers



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Re: Politeness! - I sometimes find that people these days will actually go out of their way to be rude when filing a complaint. For instance, why can't a customer just say a simple "no thank you" rather than writing in an angry tone or making threats? Of course the customer is always right, so as professionals we have to suck it in and be the bigger person... but is there a better way to deal with rude clients? When I used to work at McDonald's, I recall the store manager actually yelled back at the customer who shouted profanities at a teenage employee since the order was taking so long. While the store manager didn't use any vulgar language, he still firmly told the customer to leave the store because he wouldn't serve someone who was so rude.
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