Most companies desire zero customer complaints, not realizing that those complaints could be the goldmine for opportunities they are overlooking. Some complaints are the secret competitive advantage that some businesses need, said Dr. Janelle Barlow, president of All Out Performance and author of A Complaint is a Gift.
"Complaints offer an intimate way of understanding your business through the eyes of your customers," Barlow said during her talk, Turning Critics into Advocates, hosted by Management Strategies at Discovery Primea, Makati.
The event explored a radical idea: complaints can be your greatest source of insight and revenue if only companies dared to listen.
And listen, they did. Senior management from the event came from private foundations, telecommunications, finance, real estate and hospitality industries.
Silence is worse
If complaints aren't bad news for companies, why don't more customers speak up?
Many think something will be done, or the situation could worsen further. Dr. Barlow shared an anecdote about people being afraid to complain to their doctors, worrying that voicing their concerns might lead to worse treatment.
The same logic applies in business: customer silence can be far more dangerous than complaints. These customers walk away–the 50% you'll never see again.
But here's the twist: 60-70% of customers who have their complaints resolved satisfactorily go on to buy five times more than they initially would have.
"If you solve their concerns instead of over-apologizing, they'll return to repurchase five times more," Barlow said. "This is the power of complaint handling in the language of revenue and results."
Everyone owns the complaint
Only 1 in 10,000 written complaints ever make their way to senior management. In the US, companies are losing 1 trillion dollars due to poor complaint handling.
Dr. Barlow emphasized the need to break down silos. Businesses must instead foster a culture where everyone feels responsible for addressing customer concerns.
Too often, companies are laser-focused on acquiring new customers, missing the retention goldmine.
Retaining existing customers is significantly cheaper than attracting new ones. And the rewards are exponential. A slight increase in retention can lead to a dramatic uptick in profits.
"Most companies spend half of their revenue attracting new customers," Barlow revealed. "But retaining even just 5% of your customers can lead to up to 95% profit increase."
Turning critics into advocates
So, what can businesses do in the face of complaints? Barlow suggests three power tools to turn even the worst critics into staunch advocates.
First, widen your customers' tolerance zone. "When customers feel understood and valued, they are far more forgiving," Barlow explained. Friendliness and empathy go a long way in easing tensions and getting customers on your side. Instead of reacting defensively, create an environment where your customers feel heard.
Next, speed. "Above all, what customers want from service is responsiveness," Barlow emphasized. Quick resolutions show that you value their time and concerns. When you act swiftly, you diffuse anger and demonstrate your company's commitment to resolving problems.
Big data can speed up resolution. "Access to every data point can address the root cause of customer complaints and understand them beyond face value."
Finally, fairness is more important than you realize. Customers aren't just looking for their problem to be solved—they want it handled relatively. When your solution feels balanced and just, customers are more likely to leave with a positive impression, even if things didn't start smoothly.
Behind every complaint is a gift. The question is: Are you ready to unwrap it?
Dr. Janelle Barlow, President of All Out Performance and author of A Complaint is a Gift, addresses attendees of her talk, Turning Critics into Advocates hosted by Management Strategies.
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