4 Ways Your Small Business Can Win Back an Unhappy Customer

Author: Caron Beesley | February 25, 2014

No business is immune to complaints, but how you handle those complaints can make a surprising difference to your customer loyalty and bottom line. In fact, your unhappy customers can actually be a win-win for your business, if you handle them the right way.

As customers we’re programmed to be less tolerant of poor service recovery than we are of the poor service we received in the first place. After all, there’s nothing more frustrating to an already unhappy customer than indifference, denial and lack of follow-through from the offending business.

So what can you do to learn from these complaints and win back unhappy customers? Here are a few tips:

Be Prepared
Bad customer experiences are inevitable, which means you have to plan for them. Take the recent Target customer credit card data theft, for example. Although Target took all appropriate measures to secure their point of sale systems, once the breach was announced Target’s faced a huge backlash from angry customers dissatisfied with the retail giant’s treatment of its customers. Complaints poured into social media about “Target guests” spending hours on hold waiting to speak to customer service representatives only to be disconnected once they got through. Facebook posts by anxious customers also went unanswered or were subject to a canned response from Target’s social media team.

Granted, Target was dealing with hundreds of thousands, if not millions, of consumer concerns and complaints over a situation it was unable to anticipate. However, the company’s attempts at customer service recovery in the days following the announcement of the breach left many consumers reeling.

My point is, be prepared.

  • Listen to what is being said about your business on social media. Stay active across your social networks and be prepared for negative feedback. Use Google Alerts to set up automatic emails that notify you each time your business name is mentioned online.
  • Have a plan for responding to complaints quickly, empathetically, and deliver like you mean it (more on this below).
  • Educate your team on your customer service policies and your complaint resolution process. Be careful in the choices you make when selecting customer-facing staff – their attitude and tone can say a lot about your business.

Act Fast 
If a complaint arises, be prepared to address, or at a minimum acknowledge it, it as soon as possible. You’re already confronted with an irate customer, delaying your response will only add fuel to the fire.

Even if you can’t address or make right the situation there and then, listen, accept their side of the story, apologize and reassure the customer that the matter will be dealt with within a certain time frame and by a named person. The goal is to get the customer to a position where they understand that you are ready to help them and avoid any further escalation or complaint.

In situations like these, small businesses have a big advantage over their less agile big box, corporate competitors. The business owner is often more directly involved with customers on a daily level and therefore more accessible, while employees typically have less red tape to cut through to get matters resolved.

Commit to Solve the Problem, and Always Deliver
Once you are clear what you need to do to resolve the problem, act on it immediately, and go that extra mile to turn the complainer into a customer for life.

One way to do this is to empower employees to handle complaints. For example, a proven technique in retail/food service businesses is to give staff the authority to spend up to $25-50 of company money to solve a customer problem without having to ask. It may sound expensive, but many problems, from refunding a purchase or shipping the right item, can be solved with $50 or less. It’s a policy that also  forces your hand as business owner to ensure that service failures like this don’t happen again.

You could also tie employee goals and rewards to their handling of customer service issues.

Make the Complaint a Learning Moment for Your Small Business
If there’s one thing the business owner should take away from an encounter with an unhappy or complaining customer is to learn from the experience and make sure it never happens again. Many businesses put a high value on unhappy customers, because they represent a unique opportunity to improve their product or service.

Some learning moments you can implement include briefing your staff on the encounter and the steps taken to resolve the issue. Use role play to act out some real and hypothetical scenarios that involve both easy-going and difficult customers. Observe how your employees handle the situations and coach them on areas to improve.

The Bottom Line
Poor service is one thing, poor service recovery is another and any small business who fails to follow through on customer complaints rarely wins repeat business. It’s a tough reality, but one that is completely preventable.

Ready for more?

Apply for funding and find out if you qualify today