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Can You Hear Me Now?

Some businesses do an exceptional job of paying attention to customer feedback. Many discover that this practice becomes a path to phenomenal success.

…but other businesses choose instead to ignore negative feedback from their customers – or even deny that anything is wrong. Unfortunately, such denial often leads to the demise of the company.

Sadly, this is a common problem for business owners.

The fact is…

Even though you may think you’re doing a great job and that your business is on the right track… if your customers, clients, patients or members don’t agree, you’re in danger of losing them – unless you pay attention to their feedback, listen carefully and make some changes.

When I see a company that I like heading in the wrong direction, I express my opinion to try to help them get back on the right track. So do many others, as evidenced by a flood of passionate comments on my blog posts of the past few weeks directed at a company they feel has disappointed them.

(Catch up on previous posts and read the comments by clicking on the links in the list to the left.)

But for most people, it’s natural for people to avoid conflict and not voice their displeasure and concern. That’s why not all displeased customers are as helpful as I am to companies that make mistakes.

Michael Leboeuf wrote about those “nice” customers in his classic, “How To Win Customers And Keep Them For Life”:

“I’m a nice customer…You all know me! I’m the one who never complains, no matter what kind of service I get… I never kick…never nag…I never criticize. And I wouldn’t dream of making a scene, as I’ve seen some people do in public places. I think that’s uncalled for. No, I’m the nice customer. And I’ll tell you who else I am…I’m the customer who never comes back!”

Dan Kennedy, the world’s #1 small business marketing expert, often cautions against the risky practice of ignoring your customers, referencing a survey by the customer service research firm, TARP, about why customers stop doing business with a company:

  • 1% die
  • 3% move away
  • 5% develop other friendships
  • 9% leave because of competitive reasons
  • 14% are dissatisfied with the product
  • 68% quit because of an attitude of indifference towards the customer by the owner, manager or an employee

Okay, so you get the point. All customer feedback is a gift to a company.

So how about your business? Are you consistently seeking out, listening and responding to feedback – especially from your best customers?

Here are some customer service facts that may interest you…

According to Lee Resource, Inc.:

  • For every customer who bothers to complain, 26 other customers remain silent.
  • It takes 12 positive service incidents to make up for one negative incident.
  • The average “wronged customer” will tell 8-l6 people about it. Over 20% will tell more than 20.
  • 91% of unhappy customers will not willingly do business with you again.
  • 70% of complaining customers will do business with you again if you resolve the complaint in their favor.
  • 95% of complaining customers will do business with you again if you resolve the complaint instantly.

According to GfK NOP:

  • Reducing customer defections can boost profits by 25-85%.
  • In 73% of cases, the organization made no attempt to persuade dissatisfied customers to stay; even though 35% said that a simple apology would have prevented them from moving to the competition.

According to the White House Office of Consumer Affairs:

  • Happy customers who have their problems resolved will tell 4-6 people about their positive experience.
  • It costs five to six times as much to get a new (first time) customer as it does to keep a current one.
  • Customer loyalty can be worth up to ten times as much as a single purchase.

According to “Understanding Customers” by Ruby Newell-Legner:

A typical business hears from only about 4% of its dissatisfied customers. 96% just go away, and 91% will never come back.

As Bill Gates said…

“Your most unhappy customers are your greatest source of learning.”

Have you been avoiding, ignoring or dismissing complaints, or denying major problems in your business even when they’re fairly obvious to your customers?

If so, I hope I’ve helped you recognize the increasingly-fragile nature of customer loyalty in our current economy. …And I also hope I’ve convinced you of the importance of taking steps to improve your customer relationships.

If you want help improving your customer relationships and building a better business, try our FREE test drive and gain access to an amazing wealth of resources, tools and coaching.

And please leave a comment below to let me know what you think.

3 Responses to Can You Hear Me Now?

  1. Dianne Muldowney Reply

    December 19, 2012 at 9:18 am

    Hey Steve, Loved this. Wish you gave me a way to shar on Facebook, so my peeps could have this & Like you!

  2. Scott Hansen Reply

    December 19, 2012 at 3:49 pm

    Steve thank you very much. I feel anyone can run a business when things work well. its how we handle things when they don’t.

    Merry Christmas!

  3. Mary Forte Reply

    December 23, 2012 at 12:53 pm

    Steve, you are right on target once again.
    It is how we respond and resolve customer issues that makes us stronger as a business.

    I had a great example of this a few months ago. I was quick to take action, calling the customer in person and resolved the issue within a couple of days. She now sings our praises – (instead of telling everyone what a bad company we are). The last two times she was in the store she even brought friends with her, who are now new customers.

    Never ignore negative feedback…An unhappy customer/client will tell everyone they know. A happy customer/client may tell one person – but that one referral could mean $$$ in your pocket!

    Merry Christmas and a Prosperous New Year to all!

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