Media comments issued 7.01: The Good in Grievances
February 16, 2013 in Media Commentary
Vent2Me’s Executive Director was invited to provide comments for the February edition of the National Retail Magazine. The article titled ‘The Good in Grievances’ was in relation to the benefits that retailers can by listening to customer complaints. Read our full comments regarding the issue.
To start with a general question, why are customer complaints such an important element for retailers?
Retailers should not be scared of customer complaints, in fact they should relish in the fact that a customer has taken the time to notify the retailer of their complaint. This a contentious point to argue, because no one likes receiving a complaint, in fact most consumers don’t like making them either. It’s when retailers make the complaint resolution difficult that retailers (both online and bricks and mortar) should begin to worry.
Customer complaints have increasingly become an important element for retailers, due to the growth of social media, intense competition through online retailers and higher disposable income.
It’s important to note that for every complaint made directly to an organisation there are many more that are spread through word of mouth or now, via social media. Gone are the days where consumers might tell nine people about a bad customer service experience, instead, with just the click of a button, consumers can now share their bad customer service stories with millions of like-minded consumers, such as was the case with the Click Frenzy fiasco in November 2012.
Without customer complaints, retailers cannot grow or improve their service offerings and although retailers may feel that consumer loyalty does no longer exist, the truth is consumers will spend more at a retailer with whom they feel valued.
Retailers spend so much time trying to acquire new customers, that they forget about their current loyal customer base, retailers need to understand that that it is easier to retain existing customers than to acquire new ones. One way to effectively gain a competitive advantage is by encouraging your customer base to become ‘voicers’. These type of consumers only complain directly to the organisation and do not undertake negative word of mouth communication.
These consumers also offer retailers the invaluable opportunity to receive immediate feedback which can result in immediate service recovery and improvements. It really comes down to the fact that retailers can only fix a problem if they are aware of it!
In your experience what are the most common customer complaints in Australian retail?
Complaints resulting from overpromising is the most widely complained issue that Vent2Me receives from consumers. There appears to be a growing trend with dissatisfaction with online retailers such as Kogan and group deal sites that started up to be an alternative to main retailers. As these sites have grown, so has the expectation of their customer base. In our opinion it’s not necessary the cheapest price that attracts customers nowadays but, it’s the perceived quality they receive from the purchase. Common frustrations result from being promised that the item will be delivered within a certain amount of time, only to be disappointed that it hasn’t arrived yet. With group deal sites, consumers are increasingly frustrated by the lack of adequate service provided by the voucher organisation and the retailer itself.
We are not surprised that complaints have been targeting online retailers, as online was seen as a safe haven for frustrated consumers. Traditional bricks and mortar retailers now have an amazing opportunity to take back some of the market, not just by offering discounts but, by offering the benefits of being able to physically try the product or service before purchase. If bricks and mortar retailers want to compete with online, they need to improve their supply chain logistics. If a consumer could get the item they wanted without delay just by visiting the store, we can assure you that they would purchase it in store, rather than waiting for it to be delivered from an online outlet.
What should retailers do to address these common complaints?
Don’t over promise, it’s as simple as that and acknowledge customer complaints, not for the PR benefits but, because as the retailer you are actually admitting a mistake was made. Retailers should also ensure they have the right channels in place for resolving complaints. Research shows that 90% of consumers prefer to resolve complaints via the phone, yet most retailers have hidden their phone number from their website. Instead consumers are forced to fill out lengthy enquiry forms and wait for the retailer to get back to them. Often the phone is the quickest and easiest way to resolve complaints and it also ensures no paper trail is left which benefits retailers.
All complaints need to be answered within three business days, any further delay, results in a more frustrated consumer.
If a retailer has social media pages in place, expect that from time to time you will receive negative comments on it, do not delete these, instead acknowledge them. The worst thing you can do as a retailer is ignore complaints.
With the advent and proliferation of online retail, have customer service levels gotten better or worse? Why?
Online retail has definitely made things worse and confused both customers and retailers. Consumers first went online due to the fact they could save money, but now are starting to realise that although they may have saved money, the quality of the product or experience was not as enjoyable as first perceived.
As a result customers are less forgiving to retailers and therefore customer service levels have deteriorated, because the customer now demands more of retailers than previously before.
It’s common now for consumers to know more about the product or service they are purchasing than the retailer itself, because they have researched the item extensively. If a retailer wants to compete they need to be able to provide more than just the best price, but the best service possible including the fastest delivery, warranty conditions and so forth.
The main lesson to learn from the proliferation of online retail, is that customers hate waiting. Regardless if you are a traditional or an online retailer, you need to have effective waiting strategies in place or, the customer will switch to another retailer.
Vent2Me is an independent customer complaints portal that resolves customer grievances between organisations and consumers. Vent2Me specialises in marketing strategies for the retailer sector in particular small to medium retailers who require guidance and assistance with service marketing and traditional marketing strategies. From a consumer perspective we aim to be at the forefront of customer related issues. With a background in marketing, Vent2Me has vast knowledge in the benefits and downsides of the internet and social media as a tool for retailing and the exchange of information between like minded individuals.
Comments provided by Julia Makin, Executive Director of Vent2Me.