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‘Shut Up’ and 5 Other Tips for Effectively Handling Customer Complaints

June 24, 2015
Small Business
‘Shut Up’ and 5 Other Tips for Effectively Handling Customer Complaints
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Customer complaints are inevitable for small businesses, no matter how big or small the company. As the saying goes, you can’t please all of the people all of the time. How you handle these complaints is what’s important.

Small-business owners tend to focus their attention on sales and operations, with customer service “something extra they have to deal with,” which is a mistake, says Alan Berkson, director of community outreach at Freshdesk, a customer support platform.

Alan Berkson

Freshdesk’s Alan Berkson

“There’s a lot of value in keeping your customers happy, and it’s cheaper to keep a customer than it is to go find a new customer,” he says. “If customers care enough to tell you what their problem is, they’re telling you how to improve and how to do business with them better.”

MORE: How to name a small business

Keeping your customers happy and loyal can give your small business an advantage over the  competition, says Loretta Jones, vice president of marketing for Insightly, a customer relationship management software company.

“The more loyal your customers, the more word-of-mouth promotion you’re going to get, and word-of-mouth is still a very key avenue for sales.”

Here are six tips for handling customer complaints effectively.

Don’t dally

If a customer is unhappy with your small business for any reason, the speed with which you respond to the complaint is crucial.

Even if you can’t resolve the issue right away, Jones says, you don’t want to leave the complaint “hanging out there.” Customers want to know someone is working on their problem, so tell them that.

Loretta Jones

Insightly’s Loretta Jones

“Speed of getting back to customers is key,” she says, whether it’s responding to a complaint or a compliment.

Shut up and listen

Small-business owners have to condition themselves not to be defensive and to listen carefully to the entire complaint, says Jerry Rackley, a professor of marketing at Oklahoma State University and chief analyst at Demand Metric, a marketing advisory firm.

“You have to suppress your defensive instincts,” he says. “Shut up and listen, so you can really understand what they are complaining about.

“That’s really important, and that’s hard, because human nature is, you get defensive and you try to respond before you even hear the full complaint.”

A sincere apology goes a long way and will humanize your company and its representative, says Brad Smith, executive vice president of customer experience at Sage, a supplier of accounting and payroll software for small- to medium-sized businesses.

“Don’t let your customers wonder what’s happening — that will only upset them further,” he says. “One of the best things you can do to extend customer relationships is to fully disclose the root causes of the issues and the steps you are taking to address them. Customers want the companies they do business with to make things right.”

Get organized

One of the biggest problems small businesses have is keeping track of complaints, so finding a single system of record is important, according to Berkson.

Jerry Rackley

Demand Metric’s Jerry Rackley

“We had a customer in San Francisco who, before using Freshdesk, either missed customer complaints or had two people responding to the same one,” he says, “because they’d all come in through email, or sometimes they’d slip through the cracks.”

The complaints can then be used as market research to improve your product, since your customers are telling you what they like or don’t like about it, Berkson adds.

Let employees know what they’re in for

Train your employees. They need to be on the same page as the small-business owner and should be trained to respond the right way to customer complaints, Rackley says.

“Employees who aren’t expecting it, who think every day is going to be great and no one is ever going to get unhappy,” Rackley says, “they are the ones who are going to get surprised and run the risk of getting emotional, maybe arguing with a customer.”

Role playing can be an effective training strategy, since most small businesses already have a collection of customer complaint stories. “Use those examples of complaints in training and ask each employee how he or she would respond in that situation,” Rackley says.

Be sociable

Facebook and Twitter are no longer just a place to share business updates, photos or contact information. Small-business owners should be active on social media and communicate often with customers to provide the best customer service, Jones says. She recommends having an employee dedicated to this task.

The beauty of social media is it’s fast and easy to respond to customers, no emailing or phone calls required.

Brad Smith

Sage’s Brad Smith

“Social media is a viable way for customers to communicate with you,” Jones says. “At Insightly, we probably get anywhere from four to seven questions about the company a day.”

Don’t make promises you can’t keep

To provide the best customer service, you need to be honest and upfront with your customers.

“Whatever you’ve promised your customers, deliver it, and deliver it well — it’s as simple as that,” Smith says. “It’s better to underpromise and over-deliver than the opposite. Don’t promise more than you can provide, and never lie through omission, because it will be found out in the end.”

To get more information about funding options and compare them for your small business, visit NerdWallet’s best business loans page. For free, personalized answers to questions about financing your business, visit the Small Business section of NerdWallet’s Ask an Advisor page.

Steve Nicastro is a staff writer at NerdWallet, a personal finance website. Email:[email protected]. Twitter: @StevenNicastro.

Top image via iStock.