In addition to the damage to the brand’s reputation and the resulting customer churn, external failures hinder quality innovation. They also include indirect costs that are potentially far more damaging. These include direct costs incurred by the organization to remedy failures detected by the customer-repairs, returns, warranties, and complaint management. Of the three categories of costs of poor quality (appraisal, internal failures, and external failures), external failures pose the biggest threat. Ultimately, organizations that effectively manage customer complaints and modify their products or services to meet their customers’ needs see a loyalty boost of between 20% and 30%.Ĭustomer complaint management and the cost of poor quality But failure doesn’t have to be fatal: The same research showed that when people felt the brand properly addressed the failure, 85% became loyal, long-term customers.
Research suggests that 56% of customers will leave a brand after one customer experience failure, and of those who leave, 80% will never return. In 2018, Snapchat lost $1.3 billion in valuation after a single negative tweet from Kylie Jenner. In the internet era, brands are being held more accountable than ever and a bad customer experience can seriously damage the value of the business.
Actively managing customer complaints is a way to avoid damage to the brand’s reputation.Ĭustomer loyalty is an obvious result of assigning business value to customer complaint management. Customer complaints, therefore, are a key measurement of satisfaction for one of the brand’s most important stakeholders. ISO’s first quality management principle is customer focus, which places the customer squarely in the center of the organization’s risk profile. In regulated industries, complaints can be an early warning system that an organization may be at risk for regulatory action.
Analyzing the value of customer complaintsīusinesses can only solve the problems they know about, which makes customer complaints an invaluable tool in managing risk.
0 kommentar(er)
