`George, Send This Crank The Bug Letter'

How to recover angry customers

-- Apologize: Some employees are afraid that by apologizing, they accept blame. Kristin Anderson, project coordinator with Performance Research Associates, a Minneapolis-based management consulting company specializing in customer service, says, ``An apology does more to stem the tide of anger than any other action you can take.''

-- Fix the problem: Fair fixes may include an exchange, a refund, or a new product - without defects.

-- Empathize: ``You have to show feeling, treat the customer like you care,'' Anderson says. ``Employees need to know they have permission to care.''

-- Follow up: Make sure the solution that was set into motion actually happens.

At breakfast one morning, a man opened a new box of a well-known cereal, and, as he poured it, found a large bug nestled among the raisins and flakes. He wrote an indignant letter to the cereal company.

An apologetic letter arrived a few days later, signed by a corporate vice president. The letter assured him that the company would research the cause of the problem and make certain such a thing never happened again.

The letter itself may have soothed the man's temper. Unfortunately, attached to it was an interoffice memo with the handwritten note: ``George, send this crank the `bug letter.' ''

Management consultants Karl Albrecht and Ron Zemke describe the incident in their book, ``Service America,'' as a ``dull moment'' in customer service. The cereal company's first sin, they say, was letting a customer find its internal packaging problems. Then, because even the vice president didn't show a real interest in the customer's complaint, the company made the situation even worse.

But an angry customer doesn't always signal the end to a good relationship. Companies that upset customers actually have a very good chance of recovering those customers - and even making them more loyal than before.

About 95 percent of customers who have had a problem with a company will do business with it again if they believe their complaint was resolved quickly, according to Technical Assistance Research Programs Inc. of Washington, D.C. They will tell, on average, five people about the good treatment they received.

In a fiercely competitive business environment, a well-defined service strategy, including a system to recapture angry customers, is as important as any marketing tool. And treating customers well is common sense; because a disgruntled customer won't hesitate to spread the word about bad service.

The first - and toughest - issue for any company is identifying dissatisfied customers.

For every complaint the average company receives, it has 26 more customers with problems, according to Technical Assistance Research. And six of those problems could be considered ``serious.''

``Only about 4 percent of angry customers will tell you they are mad,'' says Kristin Anderson. She is project coordinator with Performance Research Associates, a Minneapolis-based management consulting company specializing in customer service.

``But if you can get one to say they are mad as hell, the person at the front counter can express regret. Whether or not the situation is resolved to the customer's complete satisfaction, there's a good chance you'll regain them as a customer.''

A botched corporate response can trigger many more problems.

``If an angry customer complains and gets more bad service from the front counter, the likelihood of retaining that customer is lessened,'' Anderson says. ``And if you don't leave that customer mollified or pacified, they'll go out and tell 20 or 30 others.''

Most dissatisfied customers tell nine or 10 other people about their problem, according to Technical Assistance Research. And many - about 13 percent of all dissatisfied customers - tell more than 20 people about the problem.

That many people saying bad things about a company can undo even the best marketing and promotion efforts.

Often all blame for poor customer service is placed on front-line employees - those who have direct contact with customers - and none falls to management.

``It's real tempting to throw more training at employees as a solution,'' Anderson says. ``But if creating good service is to be a long-term goal, you need to fix the right problem. Often, it's not employees who don't know how to smile and be friendly. It may be a problem where the front-line people are busy protecting the company from its customers.''

The fault for that line of thinking, she says, lies with company management.

Many companies train front-line employees to forget common-sense customer service and focus instead on pleasing management. Such companies, Anderson says, lose the edge to win and keep customers.

``When you're told your performance will be evaluated on your technical skills, how you balance out your cash register, with no mention of whether people are happy to do business with you, then . . . employees believe pleasing the boss with paper work is more important than pleasing the customer,'' she says.

Some corporations actually foster a negative attitude toward customers, says Susan Hale Whitmore, customer-service and consumer-affairs consultant for Inside-Out Productions in Laurel, Md.

``It's the mentality that we are smarter than the customers,'' Whitmore says. ``We know what they want; we know what product is good for them; we know what they ought to buy. This is a holdover from the 1950s through the 1970s, when America was focused on conveyor-belt production: Treat every customer the same, as quickly as possible.''

Now, she says, more progressive companies recognize that customers respond better to customized treatment.

``It's important to give front-line employees power to make choices as they listen to what their customers need,'' Whitmore says.

Companies should consider the types of things that can go wrong for customers, then develop guidelines that will help employees solve customer problems on the spot, Anderson recommends.

``The customer wants a service recovery fix that is unique to them, but it's important to the company that it happens within certain boundaries,'' she says. ``So a company can look at a problem and say to employees, whatever you do to solve the problem within these parameters is OK.''