…How relationship strength affects customer experience
It is said that life is unpredictable. That is true. You never know what will happen next. However, one thing we can always be sure of is that things sometimes go wrong. You might not be able to predict when or how. But you can always be sure that occasionally things would go wrong.
In the world of business, these unfortunate incidents are always just a step away. Items get lost in transit. Frontline employees get names and orders wrong. Even machines that are expected to be free of human shortcomings can sometimes disappoint. Computers crash. Vehicles break down. Blackouts occur. Generator sets malfunction.
When these things happen and they affect customers, customers complain—and justifiably so. After all, they spend their hard-earned money for error-free products and services. It is not as if customers expect perfection. Customers know there are times when things would go wrong. However, knowing that some things might go wrong does not mean you do not get disappointed when they do.
It has been argued that when things go wrong and customers complain, it is a good sign. It has been proven time without number that the majority of consumers do not complain when they are dissatisfied with service providers. Customers who do not complain might have thrown in the towel on the relationship. They might have given up on the relationship with the business in question. Therefore, businesses should be thankful when their customers do complain.
However, customers do not just complain for complaining sake. Customers expect that when they do complain, businesses would do something about the issues. Customers expect some form of recovery when things do not go according to plan. Managing customer complaints and recovering the service are two of the most important functions of every business.
Smart businesses know this and therefore they utilise a lot of resources to ensure that complaining customers are managed well. However, if the results of a research carried out recently are anything to go by, then there is a resource that could well make a big difference when things go awry. This resource is the relationship between the business and the complaining customer.
Some authors have even referred to the quality of the relationships businesses have with their customers as “strategic assets”. This means relationship quality is as important, if not more, than brand quality, managerial expertise, technological capability, and financial strength of the business as well as all of the other important strategic assets of a business.
So important is the quality of relationships that exist between the business and its customers that relationships can make or mar the fortunes of the business. According to the study alluded to earlier, company-client relationship quality is a key resource to use in managing complaining customers. The study was published in the June 2023 edition of the Tourism Management journal. It was titled, “Relationship quality matters: How restaurant businesses can optimize complaint management.”
It has been found by several studies that effectively managing customer complaints can enhance customer satisfaction, loyalty, and profit of the business. It has also been found that the way customers respond when things go bad is actually influenced by the strength of the relationship. Two customers may experience the same service failure. However, their reactions might differ. According to the researchers in the above study, this could be due to the difference in their strength of the relationships that exist between those customers and the business in question.
In fact, there is proof that customers who have strong relationships with the business have a higher propensity to complain than those with lower affinity to the business. These customers develop such an affinity for the brand or business that when things do not go as expected, they feel a stronger need to complain. One can say that they are too much in love with the brand not to complain.
It is however important to note that a strong relationship with a customer can have both negative and positive consequences. In the positive sense, customers with strong relationships might be a lot more understanding when things go wrong. However, on the flip side, customers with strong relationships might also experience a greater sense of betrayal from the business in question. “Why would they fail me when we have such a great relationship?” “How could they have done that, especially since we are “friends”?” These are some of the questions that would be bothering the customer who has strong relationship with the business.
However, for any business, the major concern should be how to optimise the complaint managements from its customers. This is where the results and recommendations of the aforementioned research comes in. For instance, it came to light that when there is a service mishap and customers complain, it is important that the recovery efforts have a personal touch.
Efforts at recovery from a poor service must be interactional to be effective. As a matter of fact, the researchers in the above-referred study argued that regardless of the eventual approach a business would adopt in handling service mishaps, there is always the need for some form of interactional effort. They claimed that “a minimum level of interactional effort conditions the overall effectiveness of compensation efforts.”
The aggrieved customer must feel that the business is genuine about trying to make things right and the best way to do so is to have someone deal with the customer personally. An apology via email might come across as impersonal and might rather escalate the bad feelings. Besides, it is also very difficult for customers to truly express their feelings via the written medium on the Net. A phone call, even though not as personal as a face-to-face interaction, is even better than an email interaction. At least on the phone, the customer gets to say what she wants to say without struggling with what words to type.
Another thing about addressing aggrieved customers via email is that there is that time lapse between the messages. The wait between the sender’s mail and receiver’s response can sometimes be very frustrating. Not knowing whether the mail has been seen or read adds more frustration to the interaction. All these challenges mean that email apologies are not the very best way to handle service recoveries.
The study found that for customers whose relationship with the business happens to be very strong, it is very important that when things do not go as expected, personal apologies are rendered from the organisation. This means a lot to those customers. Personal apologies were even more important to these customers than whatever compensation the organisation decides to offer.
In terms of compensation, it was noted that businesses employ two types of compensatory efforts—either giving vouchers to the aggrieved customer or refunding the customer’s money. The study found that customers with strong and high quality relationships with the business were less likely to accept refunds. These customers preferred vouchers to the refunds. The explanation is that the voucher signified a willingness on the part of the customer to continue the relationship in spite of the service mishap. A refund looks more like the end of the relationship.
Unfortunately, refunds are the first choice of many businesses—and they wonder why they keep losing customers. But one cannot blame those businesses too much. On the face of it, a refund feels like the best approach to deal with a not-too-satisfied customer. After all, the customer gets her money back and so that should end the matter. Unfortunately, it does not. The refund might be a good fix but it is a temporary fix.
A third angle the researchers considered had to do with the intensity of the compensation. It was of interest to the researchers whether customers cared if they were given full or partial compensation. The study found that for the not-so-happy customer after a service mishap, a personal interaction to explain the situation was important regardless of whether the business intended to give a full or partial refund. In short, it was not as much about the money for the customer as it was about the relationship. This also means that by using a more personal approach to handle the aggrieved customer, a business is able to save money on compensation.
Putting all three findings together, i.e., the recovery efforts, attempts at a compensation and intensity of compensation, one can clearly see the way to go when dealing with an aggrieved customer with an otherwise strong relationship with a business. The way to go is to be more personal in the interactions with the customer and the offering of a gift voucher as some form of compensation.
It is true that the above study concentrated on businesses within the hospitality industry. However, the lessons gleaned from the study are important for all types and categories of businesses in various industries. It is crucial that businesses, first of all, have a good understanding of the quality of the relationships they have with their customer. Evidently, the stronger the relationship, the better.
As can be seen, a strong relationships is beneficial, especially when things go wrong. Businesses must therefore put in the effort to ensure that they build and maintain strong relationships with their customers. It is interesting to note that even businesses that necessarily do not have to invest in relationships are doing so. Therefore, for the businesses whose survival depends on their relationships with customers, there is no other option. Build strong quality relationships or die!
