By: Brendon Sinclair

July 20th, 2003

Reader Rating: 9

You'll face moments of truth every day of your life. You'll make decisions and take the consequences. The consequences can be good, or they can be bad. There are consequences for every action you take.

Moments of truth can have a profound effect on your business. Not one of the businesses I've canvassed in the last month has a set policy for dealing with complaints. Not a single one.

The usual response was that the business would deal with complaints as they came in. Some simply replied, "We don't get many complaints."

You don't? It's no wonder! Look at these statistics:

• 4% of dissatisfied clients complain.
• 91% of dissatisfied clients will not do business with you again.
• 80% of dissatisfied clients tell ten people.
• 20% of dissatisfied clients tell twenty people.

Think about that. If your business receives four complaints per year, you've probably had 100 dissatisfied clients. If you have had 100 dissatisfied clients, they have told 1,200 people that your product or service is poor!

The actions you take when your client complains can have a significant impact on your business. The right response can result in increased client loyalty, a better chance that you'll make a repeat sale, and boosted referral business.

However, get the handling of client complaints wrong, and you'll be throwing money away.

In this chapter, we'll talk about why you should love clients who complain. They give you a wonderful opportunity to grow your business—take that chance! In fact, go out and dig up as many complaints as you possibly can! With good reason: those complaining clients are gold!

We'll also provide a step-by-step guide to dealing with complaints. You can't go wrong when you have a sensible, well-planned strategy for addressing any complaints that clients make.

No business is perfect. Mistakes will be made, errors will occur. The question is: what will you do when complaints are made?

For the answers, read on!

Why You Must Love Complaining Clients

Complaining clients can be a great asset to you as you build your business. Complaining clients will do more for you than just about any other clients.

Up until now, you may have looked upon complaining clients as a royal pain in the neck. They're never happy, never satisfied! They should learn to appreciate you more.

If that sounds like you, then lose the attitude! You must love complaining clients. Complaining clients tell you where you are going wrong. They're the ones at the front line, testing out your service. They're the ones who, handled the right way, will become your most loyal clients.

To build a successful and profitable business, you must love complaining clients. Seeking out and identifying client complaints is one of the most profitable activities that a business can engage in. When clients complain they are actually giving you an opportunity to keep their business—business you would otherwise have lost.

Each complaining client gives you a chance to win a “new” client. 95% of dissatisfied clients will do business with you again if you resolve the complaint in their favour on the spot (and we've already seen how expensive it is to gain a new client). That's the beauty of complaints: if you deal with them properly, and actively seek and welcome complaints, then word soon gets around.

Clients will soon feel more comfortable about making complaints, which gives you the opportunity to:

• Reduce the number of dissatisfied clients.
• Keep their business.
• Strengthen the relationship.
• Exceed their expectations.

Fix It—Quick!

Providing a swift resolution to complaints can have the wonderful effect of increasing client loyalty beyond the level that would have been achieved had the problem never occurred. Why? Because the client remembers that extra touch that you provided to resolve the situation quickly, and exceed their expectations.

As we've discussed, making a purchase carries a perceived risk. Your clients might be asking themselves:

• "Will I get good value?"
• "Will he run off with my deposit?"
• "Will she give me what I want?"

These are three fairly common concerns of people who are in the market for a Website. But eventually, the prospects take the risk and buy from you. Excellent!

Now, imagine that something goes wrong. This is not so excellent. The clients complain to you, feeling a little anxious that they haven't received what they paid for, and you fix it. Excellent!

Now, you may be thinking that you've simply resolved a compliant. But what you've really done is reduce those clients' perceived risk in buying from you. They now know that if they buy from you, they will receive what they paid for. Importantly, they know that if there is the slightest problem, you will fix it. As such, they'll be more likely to buy from you again.

The lower the perceived risk, the more likely clients are to buy from you.

As I've mentioned, my business offers a no-hassle, 100% money-back guarantee. We do that for a couple of reasons. First, it reduces the perceived risk for someone who's thinking of buying our services (though there is still a risk for buyers, as they may not know us and might not be confident that we'll honour our guarantee).

Our 100% money-back guarantee also ensures that our clients receive exactly what they paid for. After all, if we don't give them what they paid for, we shouldn't get paid. Simple.

The last complaint we received remains fairly clear in my mind. We registered a domain name for a client and sent him the invoice along with the technical details of the site (usernames, passwords, registrar, and other information). A Reply Paid envelope (to encourage a quick response—no stamp required!), and a letter thanking the client for the business accompanied these documents.

We had registered the domain name on the same day that the client made the request to us, and we sent off the information about the registration the next day. This is what we've always done, and I thought it was pretty smooth…

Until the client complained. I'm glad he did, because when he complained he gave me an excellent insight into what our clients might be thinking. He also gave me an opportunity to fix his problem and provide better service to all our clients in the future. How?

You'll see in just a moment.

The Cost Of A Good Complaint

Remember, the more complaints you hear about, the more complaints you can effectively address.

A complaint means you have the chance to generate more business from these clients that you wouldn't have otherwise received. The more complaints you hear about and deal with, the fewer dissatisfied clients you'll have talking to friends and colleagues about their bad experience with your business.

Don't think of what it will cost to fix a complaint. Think of what it will cost if you don't fix it.

Key Points

• Complaining clients tell you what's wrong with your service—you can fix it only if you know about it.
• Quickly fixed complaints increase client loyalty.
• Fixing complaints reduces that client's perceived risk of doing business with you.
• What will it cost to fix a complaint? Think of what it will cost if you don't!

What To Do When The Complaint Comes In

Now, your natural reaction might be to blow off complaints. You might feel defensive, maybe even hurt. You will probably feel that the complaint is an unjustified slight on you personally.

Get over it!

Any complaint from a client is a 100% bona fide, major issue for them. Their perception is your reality. They have a problem; you have to fix it.

Don't belittle it or treat is as inconsequential. Treat the complaint and the complainant as they deserve.

The fact that your feelings are hurt doesn't matter. These are aggrieved clients—whether or not you agree with them is irrelevant. What you need to do to ensure your business survival, is deal with the complaint quickly and in the very best of humor!

The Complaints Checklist

So your client has a complaint? Fantastic! Here's how to deal with complaining clients:

1. Reward clients for complaining
   Listen to the complaints: "Please tell me exactly how we are failing you." Find out
   how the clients want it fixed: "Now, how can we make things right?"

2. Thank them
   "Thanks for bringing this problem to our attention. We appreciate this very much,
   because we're committed to providing the best widgets possible."

3. Apologize
   "I'm sorry that the quality of the widgets has not been to our usual standard."

4. Offer a solution
   "How would you feel if we delivered free replacement widgets immediately? We will, of course, refund the full purchase price of the widgets. Is that acceptable to you?"

5. Get their agreement
   "Good, I'll have them delivered to your business within the hour."

6. Fix the problem
   Deliver the widgets, and refund, within the hour.

7. Follow up
   "I'm calling to make sure that the widgets arrived and that they are the correct size. Are you happy with the way we have handled this problem, sir?"

As you might notice, the client's problem is fixed, and he receives a benefit (free widgets) for complaining. Don't do what you say you will: do more!

Case 11.1. Complaint Resolution 101

My last complaint was from the client who'd asked us to register a domain name. As I explained, everything went smoothly… until he complained! His complaint was that, although he had received the invoice and all the technical details about his new domain name, he'd received nothing to prove that we had actually registered the name.

As you might know, the only “official” verification that the domain name has been registered comes in the form of a confirmation email from the registrar (though you can always check the registrar's records).

However, my client wanted something we don't normally provide. He wanted us to confirm that we had registered the domain name, and that we had registered it in his name. By following the steps above, it was easy to fix.

We followed the first three steps, and then asked the client what solution would best meet his needs. Did he want:

1. A copy of the confirmation of registration email?
   
2. A copy of the registrar's record of registration?
   
3. A signed letter from us confirming the registration?
   
4. A signed certificate from us confirming domain name ownership?
   
5. Something else that we hadn't considered?

Interestingly, the client opted for the certificate as proof of the domain name registration.

We designed a certification (using none other than Microsoft Publisher!), printed it off, signed it, and sent it to him! The client was very pleased to receive a nicely framed Certificate of Domain Name Ownership.

Now, thanks to this client, we know that clients might need reassurance that we have actually registered their domain. We provide this as an optional means by which we can advise them that their domain has been registered.

Believe it or not, the certificate provides us with a point of differentiation! Our prospects find out they receive a “Certificate of Ownership” when they register a domain name with us. They don't get that with anyone else!

Remember: when you receive a complaint, fix it.

Key Points

• Don't take complaints personally.
• Reward and thank the complainant, apologize, offer a solution, get agreement to the solution, and fix the problem.
• Follow up and make sure the complainant is happy with the resolution.

Don't Wait For Complaints

If you sit and wait for complaints to come in, you're like almost every other business.

As we know, most businesses fail. Don't do what they do; do something different. The impact that dissatisfied clients can have on your business can be devastating. You need to seek out and deal with every dissatisfied client.

Your potential for success will increase with every complaint you can find! We know that just 4% of dissatisfied customers actually complain. Now, that figure obviously varies according to the research you read, but the point is that not many dissatisfied clients complain. They just go elsewhere without telling you.

Ask for complaints—you need them.

Better than responding to complaints only after some gutsy clients get up the nerve to voice their issues, is this: ask for complaints!

When you finish a project for your clients, have a meeting with them. Tell them you've been thrilled to have their business, and that you're working very hard to build a business with the highest level of client service possible.

Then ask:

• "How did we do?"
• "How could we have done better?"
• "If you were me, what else would you have done?"

Ask specifically for a complaint. Don't just ask, "Are you happy with everything?" Imagine you're a client and your Web developer asks you if you have any complaints.

That's impressive!

"John, we strive to provide the absolute best service we can. Can you think of any particular instance when you have thought an area of our service hasn't been absolutely spot on? I'd love to know how we haven't been perfect for you, because I want to make it right. We're trying to build a decent business here and this sort of feedback helps us to provide the absolute best in client service."

Ask it like you mean it!

Here's a poster we've used to elicit complaints from some of our clients. Try it out and see what reaction you get.

Thanks for your business!
We want everything to go perfectly ... but sometimes it doesn't.
If something wasn't right…
PLEASE LET US KNOW.
Call us at 555-5555 so we can make it right.

Many businesses have Customer Service departments to deal with complaints. Not good enough! Only 4% of people complain. You've got to get out there and relentlessly dig up every complaint about your business that you can find. Only then will you be able to fix the things that are holding you back from greater business success.

Go on! Get out there and ask!

Case 11.2. The Simple Question That Made Me $20,000

A few years back, we were finishing off a site for a client and had completed it right down to his last detail. Everything had gone beautifully. He was a wonderful fellow to deal with, the Website development had gone really well, and he was very happy with what we had achieved.

As we finished the job, I asked him the question I now ask all of our clients. "On a scale of one to ten, how would you rate our entire service—from design, to communication, to documentation—the entire service?"

We scored a nine! That's great, fantastic, excellent! Actually… no, it's not.

Satisfied clients will not come back to you for more work. Extremely satisfied clients might come back. But absolutely delighted clients will give you more business that you'll know what to do with. Satisfied clients will not come back.

"Oh," I said. "We want a ten. What do we have to do to get a ten?"

The client told me in a very good-natured way, and though I can't actually remember what these small points were, I do remember that I promised to fix them immediately.

We'd finished them within the hour. I went back to the client and said, "OK, now would
you give us a ten?"

No—he'd thought of a few extra issues while I was away! So we fixed those as well.

"Now you're a ten!" he said.

A ten is what you want to be. I walked out of that office a happy man ...

But wait, there's more!

About four weeks later, the client rang to let me know his brother-in-law needed a Website for his large manufacturing and distribution business. He rang to tell me that he'd recommended my business for the job. A couple of hours later I received a call from the brother-in-law to ask me in for a meeting.

Ten out of ten!

In the meeting, the brother-in-law recounted the "Out of ten" story, and was very impressed. We went on to win the job with him—all because of that one simple question.

About nine months after that, he wanted us to redevelop a Website for another part of his business. And both sites needed small redevelopments within six months, as well as ongoing maintenance. Lastly, this client has referred to us another business, the Board of which is interested in developing a major Website All because of one simple question.

Key Points

• Only 4% of dissatisfied clients will complain.
• Ask specifically for complaints: "If you were me, what else would you have done?"
• Clients have friends and relatives—and they talk.
• Ten out of ten is the only score you want!

When To Say “Sorry”

When do you say, "sorry"? Whenever your client wants you to, that's when!

Let's assume that you have redirected your client's emails to the wrong email address. The client rings you with the bad news. Do you say: "Well, there appear to have been some technical issues affecting the redirect. I've fixed them now and there shouldn't be any more problems." Or do you confess: "Thanks for letting me know. I'm terribly sorry but I've made an awful mistake and redirected your emails to the wrong address. It is my fault entirely. I'll fix it immediately. Is that OK with you?"

Clients know intuitively when you are trying to fool them, and they won't put up with it. Do it once, and you just might get away with it. Do it twice, and you're gone.

A friend of mine has a philosophy of never saying sorry. His theory is that to apologize is to admit liability, and being liable could lead to problems. However, most clients I've come across aren't out to bring your business to its knees. They, like you, are only human. They understand mistakes and they'll forgive your errors. If you fouled up, admit it.

You did it, so apologize sincerely and move on. Your honesty, integrity, and reputation are your three main assets. Once you've lost them, they're gone forever.

On The War Path

Imagine your clients become very aggressive and adversarial. What then?

I had this happen a while ago, and I dealt with it differently from the way I would have when I was first starting out in business. We run an honest, open, ethical, and decent business. We want to work with people in a cooperative and receptive way so that we can provide them with the best care. As I mentioned before, it becomes a bit of an art form to identify what prospects will be like to deal with as clients.

However, we simply won't deal with people who are abusive. We say to those clients, "Your behavior is inappropriate and I refuse to enter any dialogue concerning these issues. I will send you a refund cheque tomorrow. Goodbye."

Now I'm not 100% sure of the answer to the abusive clients question. Over the years, I've dealt with grumpy clients, upset clients, and very irate and aggressive clients. I've dealt with them in different situations and in different ways, mostly defusing the situation and resolving the issue.

I've seen the destructive impact that a very aggressive client can have. It's all negativity, lost focus, and apprehension. The relationship might go on, but the rules have changed and you're not working in a partnership anymore. It's usually an uncomfortable, touchy, and anxious period. If clients become aggressive, shouting and swearing, and they're no longer listening to you or being professional, then it's time to make a decision.

Do you want to work with these people? I would say no. Not just because of the deteriorated relationship, but because you deserve to expect a level of professionalism. Common decency should be inherent in all our relationships, to help us grow our businesses and grow as people. It's been my experience that abusive clients just aren't worth the time and hassle it takes to deal with them. Cut them loose and move on. It will be a short-term pain for a long-term gain.

Find the solution that works for you. This may not be the right strategy for everyone, but it's the right strategy for me at this point in my business. Indeed, business is about making money. Defusing aggressive clients so you can continue the business relationship can be a good way to maximize your income.

However, I think there's more to it than that. I want my business to be about cooperation, not confrontation. I want it to be mutually beneficial for my clients and myself. I want my team to enjoy their work. I can't meet any of these goals if I have abusive clients.

What If They're Wrong?

There will be times when your clients are wrong. They will be confused, completely bamboozled, mistaken, or just plain wrong! So, what do you say to clients who believe they are right, when they're obviously wrong?

You tell them they're wrong!

Do it with tact, do it with care—but tell them! Don't lie and tell them they're right. They're wrong, so let them know!

We had a client recently who wanted his Website edited. He gave me the site's domain name, but when I checked, it wasn't there. I went back to my client—he insisted that the domain name was correct, and that the site had been at that domain for five years. He also told me that the he'd never visited the site before.

I checked again and again. I checked .com, .net, .org, .tv. I tried everything. I did searches, I sent emails, but I couldn't find that site. I finally confirmed that the domain name had never been registered and was, in fact, available for registration.

I rang the client and faxed him through the confirmation that the name had never been registered. The client still insisted that I was wrong. "I don't know what you've done with the domain name!" he cried.

Now, while it's fine to tell the client tactfully that he's wrong, never, ever argue with him. He's a precious, precious part of your business. And you'll never win an argument with a client.

That's why I didn't say, "OK, you're wrong and I'm right. That isn't the domain name.
You're wrong!" I phrased it more gently. "It doesn't appear that this site is currently registered—here's the documentation to back that up. Our next options are this, this, and this."

I eventually managed to convince my client, with the documentation, that the domain name was not, and had never been, registered. Yes, I did tell him he was wrong, but only in the nicest possible way.

Key Points

• Your honesty, integrity and reputation are invaluable—don't lose them!
• Say “sorry” when your client wants you to.
• Cut loose abusive clients you can do without.
• Sometimes clients are wrong—break it to them gently.

When The Blame Falls On You

One of our Web businesses experienced a very large increase in orders over a two week period. Our manufacturer could not keep up with demand and we were looking at delays of almost a month in filling orders. However, by the time we were finished with our crisis management, not one person had become upset. Not one person cancelled an order.

Not one person complained. Hundreds wrote and thanked us.

Our simple strategy was this. We wrote an email to our customers (about 1,000 of them). We told them that, because we'd made the mistake of underestimating the huge demand, we did not have enough stock to fill their orders immediately. The estimated time of arrival for their product was one month. We apologized for the delay and we took full responsibility for it.

Take full responsibility—problems aren't the client's fault.

Our message was not, "Due to huge demand our manufacturer has been unable to supply us," but instead a sincere, "Wow! We certainly didn't anticipate the response to our marketing strategy that we've had. It's completely our fault that we don't have enough stock… sorry."

We told them that we'd understand if they wanted to cancel their orders, as we hadn't met our part of the bargain, but at the same time, we urged them to hang in there, and we'd ship their product as soon as possible.

Incredibly, the only responses we received were positive messages saying, "Thanks for keeping us informed!" It was unbelievable. I expected quite a few irate messages, but
we didn't receive a single one.

We then emailed the waiting customers an update every week. Again, more emails of thanks flooded in. When we finally shipped out, every customer received a small gift to say, "sorry for the delay," along with a personalized letter of apology.

What looked like a disaster turned out to be a triumph (of sorts!). We maintained close contact with the customers, developed the perception that we were trustworthy and ethical, and we even eventually exceeded customers' expectations (with the gift).

I never have taken a look at the stats but I'd guess that the 1,000 customers we kept waiting for a month would have higher repurchase rates than those of the customers we served immediately.

Research shows that clients who complain, and whose complaints are satisfactorily resolved, are more loyal than those who never had a problem!

And as we've discussed, this effect is related to the perceived risk of dealing with you. People always seem to assume the worst in clients. I can't understand why. Treat them with respect and reason, and you'll get the same in return.

Now, obviously products are different from services, and the contracting of Web development services is different to my online store's fulfilment problem.

Messing Up On The Web

A Website is different from any other product—it's such a subjective item. What if your client complains about the design of the site? Surely that's a subjective thing and—being the hot designer that you are—you're much better qualified to judge what's best. Right?

Wrong.

There is no such thing as good Website design. It's a subjective thing. Depending on what side of the fence you're on, the design can look great or it can look like garbage. Whose fault is it if you do a wonderful design and the client complains about it? It's yours.

You should have educated the client every step of the way and made the design a consultative process. This is the very same reason why your guarantee should never be called in. If you closely consult with your clients and keep them fully educated about the whys and wherefores of the design, then you will have happy clients.

In short, if you don't pay attention to your clients, they have excellent grounds for complaint.

Key Points

• If you mess up, admit it openly and fully.
• Take full responsibility for what happened.
• Provide options and solutions to the problems caused by the error.
• Reap the rewards from increased client loyalty.

Providing Distinctive Service

I'm a big advocate of making your business distinctive. Make it unique so that people hear about it. After all, people can buy your service only if they know about it.

In Chapter 7, we talked about building your own competitive edge. In Chapter 9, we saw how great service can really set you apart from the rest. Complaints are just another area of your business in which you can leverage your competitive advantage by providing excellent service.

Be known for unique things that are positive things. If you go out searching for those complaints, you'll be fairly unique.

If you provide a 100% money-back guarantee on your service, you could well be unique. If you deal with complaints in a fair and rapid manner, you'll definitely be unique! People are happy to pay a premium price to have their needs met. People will be thrilled if you exceed their expectations, treat them with some dignity, and keep in contact.

Most people believe they receive value for money when they buy a product. There isn't really much scope to move on that. The prices are well-documented, and it's easy to compare products to products and prices to prices.

Measuring value is difficult when the product is intangible. However, the situation with services is very different. People are far more likely to be discontent with the “value for money” they receive, because it's much harder to measure value for money when you're talking about a service.

Let's say you charge $150 for a one hour consultation with a client. Let's say I charge $50. We both sit for an hour and talk with the client. Is your value three times mine? I have no idea. You have no idea. In reality, the client has no idea. The only measurement the client can make here is a perception of value for money.

As we've already discussed, an enormous range of factors will influence that perception. Your voice accounts for 38% of the impression you make on people; 55% depends on how you look and only 7% on what you say. (Source: Mehrabian, Albert. Silent Messages. Wadsworth Publishing Company, 1971.)

Let's apply these statistics to our value for money comparison. If you sound better than me, the perception that you offer better value for money will hold true!

Just how important is distinctive service?
Consider this. In a 1987 Gallup Poll, 83% of those surveyed identified their number one reason for deciding not to return to a restaurant as poor service. Not the food. Not the price. The service.

A Washington Post survey found that almost half of all shoppers believe service is mediocre and getting worse! Other research suggests that more than 40% of consumers experiencing problems are unhappy with the action taken to resolve their complaints.

There's no substitute for service!

Many businesses today try to make up for poor service with lower prices. But quality is the compelling feature you need to project in order to survive and be profitable. If you provide quality, you can charge more. If you charge more, you'll be more profitable.

If you're more profitable, you'll have the resources to allocate to ensuring quality stays high. That's the cycle you need to get into!

Quality control of a product is easy. Typically, there is a set of standards to which the product must adhere, and if it does so, it meets the quality standards. Simple.

The quality of a service is a little harder to define. For a start, a service doesn't exist until you provide it. The client's perception of that service is the only real measurement. You need that feedback to be able to ascertain the quality of your service, and how you can apply it to the next opportunity you get to provide it.

Your challenge is to create a distinctive level of service. Don't aspire to be like the others. You're better than that!

Key Points

• Make your service distinctive.
• People will pay a premium price for great service.
• Quality is the imperative for which you must strive.

Chapter Summary

You will make mistakes in your business—that you can be sure of. You will receive complaints—another truth you can be sure of.

Don't look upon complaints as negative, destructive things. Embrace every complaint and treat it for what it is—a fantastic opportunity to build your business.

Treat lovingly every person who complains, deal with their issues swiftly and with good sense, and you'll have a client—and an advocate—for life. That person who complains about you is the very same person who will be soon be singing your praises—if you deal appropriately with their problem.

Because of their incredible worth, you must actively seek out complaints. In this chapter, we've discussed the amazing value of complaints, and we've seen how responding with a positive, effective solution can inspire client loyalty. We also understand that effective complaints handling is like winning a “new” client, and increases your referral business.

Make your business the distinctive and dynamic enterprise it can be. Go out on a limb, push the boundaries and create something great. You can do it. Grab a big advantage by treating those complaining clients like the wonderfully open, honest and useful people they are!

In Chapter 12, we apply the material we've discussed over the last five chapters in exploring the key methods you can use to increase sales and ramp up your business day by day. Are you ready to grow?

Get ready to grow your business. /#l#/http://www.sitepoint.com/article/1200/#nlt#/Read Chapter 13 - Prepare For Expansion/#enl#/.