How to Manage and Retain an Unhappy Customer
As hard as we try to continuously delight and retain our customers, we simply cannot please everyone, and unfortunately, a customer will occasionally slip through the cracks.
Concurrently, as an organization grows, it becomes increasingly difficult to maintain a consistently high standard across customer service teams.
As a result, we may find ourselves with an unhappy customer threatening to take their business to a competitor –– whether their displeasure stems from the product itself or a recent interaction with a member of the organization.
To help outline an effective customer retention process, let’s look at a recent example from a company where an enterprise client was threatening to switch providers, and how the Co-founder used their emotional intelligence and executive presence to maintain the customer relationship.
Note: the names of the individuals and companies have been changed to respect their privacy.
1) Response Format & Critical Inclusions
Firstly, in drafting an effective customer response, it’s vital to ensure that we validate their concern while maintaining the company’s integrity, and ultimately, retaining their business.
In crafting an effective response, remain mindful of the following key points:
- Before you respond, put yourself in the customer’s headspace to fully understand their complaint or concern;
- Use a clear, descriptive Subject line;
- Use a respectful Salutation suitable for business communication;
- Say “Thank you” for their feedback at the start of the email;
- Apologize (even if you don’t agree or if it was the customer’s fault);
- Explain what happened truthfully and politely;
- Tell the customer what you will do to help;
- Keep your message succinct, brief, and on topic;
- Use a respectful Closing statement suitable for business communication.
Keep in mind, as the leader of the company, it’s our job to display effective leadership qualities, such as respect for others, the ability to diffuse anger and focus on positive outcomes, show empathy, and the willingness to be candid about an error or poor performance.
These are the types of foundational leadership characteristic and values which build trust and respect across all aspects of the organization, from customers to fresh hires and senior Board members.
2) A Real-world Example — Widgets Inc.
Included below is the email from the Co-founder & CEO responding to the unhappy client.
Subject: Re: Your recent customer experience
Dear Mr. Smith,
My name is Alex Jones, CEO of Widgets Inc. I received your complaint regarding a recent interaction with a member of our sales team and I wanted to personally follow up with you.
Firstly, thank you for taking the time to provide valuable feedback regarding your recent interaction with our sales team. Each day we strive to provide exceptional service for our customers, and I am truly sorry we have let you down. On behalf of the entire team here at Widgets Inc., I would like to express my sincere apologies.
I want you to know I have spoken with John from our sales team as well as his direct manager. As a new employee here at Widgets, John now understands his actions were not in alignment with our company policy, and I assure you we are working hard to avoid this situation in the future. Each of our employees undergoes rigorous training here at Widgets, and I have requested this situation be included as a learning module within our training program. Once again, I am genuinely sorry for your inconvenience, however, your feedback is now helping us to improve our service.
I understand your frustration and subsequent desire to switch providers. However, given our successful history of working together, I would be saddened to see it end on a negative note. With your approval, I would like the opportunity to make things right and cover the cost of your recent order, as well as an additional 20% discount on your next order. If after your next order you are still not satisfied I sincerely respect your decision to switch providers, no questions asked. I have requested your account be transferred to our most senior sales representative, Amy, who will process your refund. Please let me know if this is OK to proceed.
I sincerely hope we can continue working together and appreciate any additional feedback you may have. Please don’t hesitate to contact me anytime by email, or my personal cell phone at 555–123–4567.
Sincerely,
Alex Jones| CEO, Widgets Inc.
ajones@widgets.com
3) Rationale: Breakdown & Analysis
In addition to apologizing and taking ownership of the issue, there are several key elements Alex attempted to achieve with his email. Let’s break them down one by one.
1) Let the customer know their voice has been heard. If the customer knows their concerns are being addressed they are more likely to continue doing business with you.
“ I want you to know I have spoken with John from our sales team as well as his direct manager… I assure you we are working hard to avoid this situation in the future.”
2) Empower the customer by letting them know their feedback is making a positive impact.
“… I have requested this situation be included as a learning module within our training program. Once again, I am genuinely sorry for your inconvenience, however, your feedback is now helping us improve our service.”
3) Build rapport and empathy for the customer, and address their threat to switch providers head-on.
“ I understand your frustration and subsequent desire to switch providers… If after your next order you are still not satisfied I sincerely respect your decision to switch providers, no questions asked.”
4) Offer the customer compensation for their order, but also encourage them to continue doing business with you by including an incentive offer.
“… I would like the opportunity to make things right and cover the cost of your recent order, as well as an additional 20% discount on your next order.”
5) Rebuild the customer’s confidence in doing business with you by pairing them with a senior sales representative.
“ I have requested your account be transferred to our most senior sales representative, Amy, who will process your refund.”
6) Require the customer to invest time and energy into responding, which may result in an increased likelihood of keeping them as a customer.
“ Please let me know if this is OK to proceed.”
7) Let the customer know that any additional feedback is welcome, attempting to turn them into a trusted advisor and brand ambassador.
“… and appreciate any additional feedback you may have.”
Remember, as the leader of the organization, it’s not Alex’s job to not assign blame, but instead, own the error from a company perspective and share a plan of action to ensure the issue will not persist.
What happens if the customer does not respond, nor shares their position on moving forward?
In Alex’s case, the customer ended up responding and the relationship was salvaged. However, if this were not the case, and the customer went radio silent, Alex made sure to have a backup plan.
First, not wanting to spam their inbox, Alex was prepared to wait three business days for a response to his initial email. After three days, if he had not heard anything from the customer, he would try giving them a call.
If they answered his call, great, Alex would work to resolve the situation and move forward. However, if they did not answer his call, Alex would attempt to complement one communication method with another.
For example, he planned to leave a voicemail and reference his initial email (which may have gone to the customer’s junk folder). He also planned to explain in his voicemail that he would send a follow-up email to summarize the details of his initial response.
In his follow-up email, Alex would mention leaving the customer a voicemail, and ensure to close the email with a specific call to action he would like the customer to take. For example,
“Mr. Smith, thank you once again for your time and patience as we work to resolve this issue. I know you are quite busy, so if you could please reply to this email with a simple “YES” or “NO” I can expedite your order accordingly.”
Throughout his work experience, Alex discovered that asking very simple and direct Yes or No questions often generated the highest response rate.
Ultimately, people are busy and don’t want to spend time writing an email, so the more we can simplify the process for them, the better.
Lastly, if the customer maintains radio silence and we still do not hear anything from them, is it then best to simply take the initiative and process their refund. Keep their account open, after which you may try contacting them every few weeks.
After six months, if you still haven’t heard from them, begin an email/phone sequence with the subject line, “Permission to close your account?”
We cannot win every battle, but by this point, it should be evident the customer has switched providers, and at minimum, this might elicit a final response.
About the Author
Matthew is the Founder and Managing Director at Allied Venture Partners, Western Canada’s largest angel syndicate investing in early-stage tech startups across Canada & the United States. To learn more, please visit Allied.vc
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