Famous Last Words: Upset Customers Break Companies
A pre-Internet marketing rule stated that a happy customer would tell an average of three people while someone who was disgruntled with a product or service would tell 11.
The advent of the Internet has upped the ante exponentially. Wrong a customer, and you will be punished. For example, if you haven't heard the 2006 customer service call that went all over the Internet and effectively wrecked AOL, give a listen: http://url2it.com/bhoc.
Dave Carroll, a guitar player with Sons of Maxwell, was flying United Airlines to a gig in Nebraska with his $3,500 Taylor instrument. Witnesses said they saw baggage handlers in Chicago throwing luggage around including his guitar, which, he claims, they broke, and he was stuck with a $1,200 repair bill. (It should be mentioned here that top musicians buy seats for their instruments, e.g., Yo-Yo Ma's cello.)
You'll find Carroll's harrowing account of the incident at http://url2it.com/bhmr.
It's a story that starts ugly and gets uglier as the United bureaucracy gave him the runaround for six months. Carroll blogged about it and then wrote an endearing song titled "United Breaks Guitars" and produced it as a very amusing video on YouTube, which you can see at: http:// url2it.com/bhmq.
As of press time, Carroll's YouTube production has generated more than 6 million views.
United's third-quarter loss was $57 million, and chances are very good that some of the red ink could be attributed to Carroll giving its customer service a spike in the eye with his blog, his song, the attendant press coverage and ghastly PR.
The takeaways from this story are many and worth committing to both memory and to a corporate operations manual:
• With the Internet, an unhappy customer can reach millions to billions of people worldwide.
• The term CRM, customer retention (or relationship) management, was dreamed up by MBAs or bean counters with antifreeze running in their veins. Your job is to create customer relationship magic!
• "Times of adversity and customer screwups may be the only times when you can really show your customers how much you love them." —Malcolm Decker
• "Properly handled, disgruntled customers can become your best customers." —Judith Schalit
• Do you have secret shoppers constantly ordering and returning merchandise and then reporting back to you on your fulfillment operations? If not, why not?
• "Consumers are neither sheep nor fools. They can sense when companies are consistently more loyal to investors, employees and regulators than to the people who buy their products and services. They behave accordingly. Customers are not being disloyal; they are being discriminating. The central marketing question confronting brand leaders therefore is not, 'how can we radically increase customer loyalty?' but, 'how can we radically increase our own loyalty to customers?'" —Michael Schrage, FinancialTimes.com, "Customers want loyalty, not perfection," May 1, 2007.
Denny Hatch is a freelance direct marketing consultant and copywriter, and author of the e-mail newsletter, Denny Hatch's Business Common Sense. Visit him at www.businesscommonsense.com or www.dennyhatch.com, or contact him via e-mail at firstname.lastname@example.org.