We all know that “all customers are not created equal” because some represent significantly more value than others, but have you also examined their variations in propensities to complain (PTC)?
Over the past 20-30 years, academicians have studied PTC and other factors describing what they call “Customer Complaint Behavior” (CCB), and while their studies are interesting, they lack implications for actions that companies need to take to change processes and behaviors to recognize the importance of PTC to improve customer experience (CX) and achieve operational efficiencies.
Let’s start with a frequently cited statistic that very few customers bother to complain about service or product issues, in some studies as few as one in 25 or only 4%1. Before coming back to this challenge later in this article, let’s look at three disguised examples regarding PTC in order to produce specific actions, extracted from research into our latest book The Frictionless Organization2:
- A U.S. Internet retail company set up operations in Japan and patterned the expected size of the customer care organization off of its existing experience in the United States. Once the Japanese site launched, they were pleasantly surprised that the contact rate was significantly lower than that in the US, on the order of 25% to 30% of the U.S. rate. However, since management had a keen sense that Japanese customers probably encountered the same rate of problems as the U.S. customers, this meant that 70% to 75% of Japanese customers who faced those problems didn’t bother to contact the company for support.
- A U.S. set-top box manufacturer was chronically behind in its customer service levels until it analyzed that every new product launch or wave of promotions produced a huge spike in contact rates three times that of customers with an existing box.
- A global provider of telecommunication services initially expected the customer contact rates across its many countries to approach the best of those countries. However, they realized that some of the countries’ customers were more demanding or, in other words, were willing to and eager to contact the company more frequently for the same issues.
All three of these examples point out that understanding the propensity to complain is imperative to improve CX and achieve frontline efficiencies.
In the first example, the Internet retail provider had to determine a way to reach out to the customers who did not bother to contact them for support even when they were also experiencing the same rate of problems. This encouraged some initially quiet or reticent customers to consider reaching out for future issues but also to become educated on digital self-service solutions that might be available to solve the same problems.
In the second example, the set-top box manufacturer’s support team started working more closely with product marketing and the promotions groups to increase staffing ahead of new launches and customer promotions, thereby bringing service levels in line and aligning skills, for example forming a crew dedicated to assisting new customers who were not acquainted with the company’s processes or plans.
In the third example, the telco provider started to create different standards for ideal and target contact rates based on the cultural differences across its countries.
There are four ways to be learned from analyzing the propensity to complain to improve CX and achieve operational efficiencies:
1. Determine which customers successfully solved their problems upstream of your assisted support
Review support interaction (contact centers, retail, social) in digital tools such as apps, website FAQs, IVR, or chatbots. Related, figure out which customers were not able to solve their problems upstream and still needed to contact the company for support. Proceeding from this point means determining if there are patterns between those customers who were able to solve for themselves versus those who needed assisted support, learning over time how to increase the amount of digital self-service and reduce the need for assisted support.
- CX — Reduce the need for assisted support. Spend less time casting about to find where to get answers. Less customer effort.
- Operational efficiencies — Improve containment in the digital channels and reshape the assisted teams to tackle issues more quickly.
2. Profile the difference in contact rates between new customers and those with more experience with your products and services
This will enable you to prepare for the heavy waves of contacts when new customers arrive and the eventual reduction in contact rates as the average number of customers has a higher tenure over time. It will also enable product developers to produce even more intuitive “out of the box” experiences to blunt the higher new customer PTC.
- CX — Accelerate onboarding so that customers appreciate the service or product more quickly, will use it more, and will say good things to others. Reduce speeds of answer which saves time for customers. Higher c-sat.
- Operational efficiencies — Smooths out forecasting and scheduling. Reduces frontline stress when the phones ring off the hook.
3. Figure out the PTC by region or country and begin to understand “Why?”
For example, why do our customers in Boston complain more than those in New Mexico? Or, less in South Korea than in Australia? Also, calculate the difference between contact rates for men and women, age groups, income levels, and other important demographic elements. Consider aligning support teams with regions as T-Mobile announced with its Team of Experts3 and applying other tools to match customer types with frontline skills or types.
- CX — Increase understanding levels between customers and the frontline. Higher c-sat and loyalty, re-purchase.
- Operational efficiencies — Better forecasting and scheduling of assisted support and the development of targeted programs to encourage self-service if that’s a better solution versus assisted support. Also, shorter time to resolution.
4. Identify which customers have never contacted you for support and then create a program to reach out to them
Determine if they are happy campers or silent sufferers. Refine website tutorials and marketing materials and come up with other ways to encourage customers who might be silent sufferers can express their voice while those who are happy campers might be approached for cross-sell or upsell opportunities. It’s also a good idea to review the core tenets of the vintage book Exit, Voice, and Loyalty4 that’s been part of my reference library since business school.
- CX — Engage with the silent sufferers and increase their retention; engage with the happy campers to be able to sell more to them. Overall, increase loyalty and positive word of mouth.
- Operational efficiencies — Reduce the tendency to cross- or up-sell to customers irritated with your products or services, freeing up resources to resolve issues and target the happy campers.
Following these four ways using PTC will improve CX and achieve operational efficiencies, as well as inform CXOs and relieve some of the stress on the frontline … a true win/win!
1 This and other useful data points in this Medallia article “Customer Service Stats That Matter”: https://getmindful.com/blog/customer-service-stats-that-matter-part-ii/ (accessed 7 April 2023).
2 Bill Price & David Jaffe, The Frictionless Organization: Deliver Great Customer Experiences with Less Effort, Barrett-Koehler June 2022.
3 Matthew Dixon, “Reinventing Customer Service” in Harvard Business Review, https://hbr.org/2018/11/reinventing-customer-service (accessed 7 April 2023). Introduces early results from the T-Mobile Team of Experts (TEX) program with regional support teams, less need for transfers, and other customer benefits.
4 Albert O. Hirschman’s 1970 book Exit, Voice, and Loyalty is summarized here: https://en.wikipedia.org/wiki/Exit,_Voice,_and_Loyalty (accessed 5 April 2023).