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You Screwed Up, and You Have an Angry Customer. Now What?

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Mistakes happen.
Use these customer service techniques
to win your customers back.

James, a good friend of mine, was staying in a hotel on a business trip earlier this year.

On the last day of his trip, James — or, more accurately, his company — paid extra for a late checkout so that he could stay in his room to be on an important sales call.

Knowing that he would need privacy, he hung the Do Not Disturb sign on his door right before the call.

Sure enough, 20 minutes into James’ call, there’s a loud knock on his door.

He was distracted, but he ignored the knock, hoping that whoever was knocking would go away.

Then came another loud knock.

Just as he was excusing himself from the call (no doubt to the dismay of his boss) to answer the door, a hotel housekeeper slid their keycard into the lock and pushed the door open.

As soon as she saw James with his headphones on, she apologized and left, but the damage was done.

The interruption had potentially cost him an important sale (though fortunately, it didn’t), and it ruined his experience at the hotel.

James went down to speak with the hotel manager before he checked out. What happened next surprised him, to say the least:

The manager listened to James’ entire story.

Did he need the details about how important James’ call was?

Of course not. But James was upset, and the manager understood that. He also understood how important it was for James to feel like he was being heard, so he let James rant until he got everything out.

Next, the manager apologized profusely. He took responsibility for the error, noting how upset he would be himself if the same thing had happened to him. He admitted that it was probably a training issue and that he would work with the housekeeping staff to ensure that it doesn’t happen again.

Already, James was cooling off a bit.

But then, the manager went a step further. He offered James a free night certificate that could be used at any hotel in the entire chain.

In just a few minutes, James went from being a furious customer to a satisfied, loyal one. By the end of the meeting, he was brushing the issue off as a minor hiccup, even pointing out to the manager that housekeeping had been excellent throughout his stay, and asking that no disciplinary action be taken against the one who came into his room. According to James, she’s still there.

This happened in Seattle, and James continues to return to the same hotel by choice because of the way they recovered from their mistake.

Marketing professors Michael McCollough and Sundar Bharadwaj call this the service recovery paradox:

The service recovery paradox is the result of a very positive service recovery, causing a level of customer satisfaction and/or customer loyalty even greater than that expected if no service failure had happened.

Simply put, mistakes happen. They’ve always happened, and they always will happen.

Good customer service isn’t about completely eliminating mistakes — a near-impossible task — but about leveraging the opportunity created by a mistake to build a deeper relationship with your customer.

Five Steps to Excellent Customer Service Recovery

The Walt Disney Company is known for being a masterfully run company.

In everything from logistics to leadership and marketing, Disney is looked at as a model business for others to learn from and emulate.

In fact, businesses pay many thousands of dollars to send their employees to the Disney Institute to learn the company’s insights.

And with more than 135 million people passing through the company’s parks and resorts each year, Disney has perfected the art of customer service recovery to create happy and loyal customers.

Their approach to service recovery is a five-step process, easily remembered with the acronym H.E.A.R.D:

  • Hear
  • Empathize
  • Apologize
  • Resolve
  • Diagnose

1) Hear

Just as the hotel manager did in James’ story, let the customer tell their entire story without interruption. Often when we’re upset, we just need someone to listen.

2) Empathize

Empathy is one of the most critical customer service skills you can possess. It’s the ability to deeply understand the thoughts and emotions of your customer, and making sure that they know that, too.

You can use phrases like “I’d be upset too” or “I can see why you’d be frustrated.”

3) Apologize

As long as it’s sincere, you can’t apologize enough for screwups.

In one study at the Carey School of Business at Arizona State University, 37% of customers were satisfied with service recovery when they were offered something of monetary value (e.g., a refund or credit). But when the business added an apology on top of the compensation, satisfaction doubled to 74%.

The Value of An Apology The Value of An Apology

4) Resolve

Resolve the issue quickly. This can only be done if your employees have the authority to do what it takes in terms of compensation, so make sure you’re empowering your team to act.

If you’re not sure exactly what sort of compensation or resolution would be appropriate, ask the customer:

What can I do to make this right?

By showing an eagerness to do right by them, you can begin to bridge the gap between your customer’s dissatisfied state and where you want them to be.

5) Diagnose

Once the customer is satisfied, get to the bottom of why the mistake occurred, without blaming anyone:

Seek perfection, settle for excellence. Remove any personal guilt and examine the processes related to the service failure. Returning customers will appreciate your efforts to improve the experience.
The Disney Institute

Customer Service Screwups Are Opportunities, Not Outcomes

It’s easy to let angry customers walk out the door after you make a mistake.

And sometimes, they’re going to leave no matter what you do to try and keep them.

But successful businesses know that service recovery is one of the most important elements in customer retention. By following a few simple steps, you can turn upset customers into loyal, happy ones.

Have you ever been on the receiving end of amazing customer service recovery? I’d love to hear about it: share your story in the comments below.

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About the Author

Len Markidan heads up marketing at Groove. He’s focused on helping startups and small businesses build better relationships with their customers.

Read his latest posts or follow him on Twitter

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