Why Is The Customer Always Right?

Because we have the money.

Furthermore, studies show it can cost up to nine times more to acquire a new customer than to retain an old one, reports the Deseret News

With that in mind, businesses are turning to people like Kristen DeTienne, an expert in the art and science of customer recovery.

    “She says making customers happy once there’s been a service failure requires two components, psychological and tangible.

    The psychological component, she said, focuses on whether the company is empathetic toward the customer and genuinely sorry. The tangible response refers to how the business makes it up to the customer, whether through a discount or a free product or service.

    She gives the example of a student of hers who paid for flowers to be delivered to his mom on Mother’s Day. By accident, the flowers were not delivered. When the student called, the florist profusely apologized for the oversight — the psychological response — and then offered the tangible response of delivering a different bouquet of flowers to the mother’s house every day for a week.

    “I can say I’m really sorry, but sometimes, if you’ve been really inconvenienced, that’s not enough to regain your loyalty,” DeTienne said.

    “We found that both components work together to regain customer loyalty. . . You can’t have one without the other and expect to be successful.”

Paraphrased and quoted from a Deseret News article by Greg Katz, read the rest here. (Thanks to Octavia!)

Comments

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  1. Chris Gibson says:

    Just today, I ran into a nice (if minor) example of this in action. It wasn’t a big deal – I went to the local Friday’s restaurant in Round Rock, Texas, and asked for my favorite appetizer: potstickers.

    They were all out of them. Rats! In response, the manager not only specifically apologized, but they gave me a complimentary appetizer to boot.

    Psychological + Tangible = Cheap Lunch + Happy Customer!

    Really, it isn’t that hard to do, but it does take someone with the authority to do it. I can only speculate at the reasons large organizations don’t delegate the authority to make the customer happy…fear of lawsuits when remedies are applied inconsistently? Paranoia about loss of “control” of costs? Worry that the CSR’s will do some “gimme” to a friend? All of these are actually realistic concerns today, so one wonders if the pathetic state of customer service today is the natural result of this lawsuit-happy, somewhat greed-centric society of ours.

    Color me a fine shade of disillusioned, I guess.

  2. The Unicorn says:

    I just posted a rant about more or less the same thing in the thread for the Blame Game poll — it’s incredibly frustrating when you realize how many “bad customer service” stories are the result of poorly-trained employees and/or corporate systems that don’t empower CSRs to satisfy customers in meaningful ways.

  3. Jesse says:

    This probably isn’t the case with smaller transactions like restaurant meals or retail purchases, but in some big-ticket or liability-prone cases, many times a company is afraid to apologize lest it be constituted as a legally binding admission of guilt. Nowhere is this a bigger problem than in the lawsuit-ridden medical industry. Illinois passed a “Sorry Works” law last year as a two-year pilot, which shelters written apologies as inadmissible in courts. So many people file lawsuits, especially wrongful death, because they feel they were mistreated. Hopefully this law will make things better for everyone.

  4. Mary Marsala With Fries says:

    Chris’ comment is yet another flag in the air for SMALL BUSINESS. I’ve long argued that one tangible reason that small businesses are better is that the employees are generally far more empowered to assist and satisfy the customers. And thank goodness the numbers are coming out to show that keeping customers is WAY more monetarily sound than throwing them away…Does anybody else wonder if these huge, indifferent companies would even exist if it weren’t for corporate welfare??

    That said, this was a great piece, and I’m adding the general content of it to my own company’s Customer Service Guidelines.