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06 October 2015

Customer Complaints

Baringa is supporting National Customer Services Week run by the Institute of Customer Services (ICS) through a series of blogs highlighting different themes. On day two we consider customer complaints…

The first step in any successful customer service strategy is properly understanding the levels of customer satisfaction. This is often measured through customer satisfaction and Net Promoter Score (NPS) survey data, but another influential measure is complaint volumes. This is particularly important in regulated industries, including the financial services and utilities sectors, as volumes not only have financial implications but must also be reported and published, which draws attention and review from customers, the regulators and, of greatest influence, the media.

However, formal complaints do not capture all the negative customer feelings about an organisation. I know from my own experience that I rarely have time to go through a formal complaints process; often I just vent my frustration to friends, family and colleagues (as well as complete strangers on social media), and at the next possible opportunity switch away from the offending organisation.

In a recent survey by the Institute of Customer Service (ICS), 13.4 per cent of customers across a range of sectors have had a problem in the last three months, but only 9.7 per cent have actually engaged with the organisation (equivalent to 28 per cent of those with a complaint). The proportion of customers experiencing problems suffering in silence within Baringa’s industries is 25 per cent in financial services, 19 per cent utilities and 22 per cent across telecoms and media firms. The most commonly cited reasons for these customers not engaging with firms is that:

  • they feel it wouldn’t make a difference (55 per cent)
  • they don’t have enough time (20 per cent)
  • a feeling that the feedback process is too much hassle (17 per cent).

Most established firms now have root cause analysis in place as part of their complaints management processes. However, ICS’ findings indicate that, no matter how well these processes perform, firms probably don’t understand the reasons for the dissatisfaction of these ‘silent sufferers’.

Techniques which firms could apply to firstly understand the entirety of customer feelings, and subsequently take appropriate steps to fix the identified issues include:

  1. Collect all customer feedback: Develop a process across all channels and customer engagement points to effectively capture customer feedback. This should include all sales, services and social media channels. Customers may not expressly state their negative viewpoints but this can be identified through other actions (e.g. not renewing a product), tone and broadcasts on social media
  1. Develop a holistic customer feedback review process: Implement customer service review forums to discuss the feedback received and empower representatives from across the organisation to develop solutions. For example, an expression of dissatisfaction in the post-sales department may have its origins in the original sales or marketing process
  1. Understand customer journeys: Using the customer feedback to walk through the end-to-end customer journey helps to identify issues and develop possible solutions. The key to success is ensuring these journeys, and the associated customer feedback, are owned at every level of the organisation
  1. Make changes: Once issues have been identified, respond rapidly and then monitor the impact through all feedback channels. Iterate where necessary. Where more complex, and time intensive solutions are required, look to develop short-term fixes and, if all else fails, acknowledge problems and reimburse the customer if necessary

In order to develop any successful customer service initiative, the first step must always be to understand your customer’s feedback. Second step – act on it.