PART FOUR
VIEWING COMPLAINTS AS EMOTIONAL OPPORTUNITIES

Complaining customers can be converted into loyal customers who engage in less negative word of mouth. As a result, treating complaining customers well is, in many ways, a simple economic decision. It has been estimated, as a general ratio, that it costs five times more to get a new customer than to keep an existing one.¹

Effective complaint handling can make a major difference to customer retention rates—even after service failures. According to a Technical Assistance Research Programs, Inc. (TARP) National Consumer Survey study, if customers experience minor problems and their complaints are resolved quickly, 95 percent will repurchase from the same organization; 82 percent will buy again even if the problem is major. If the complaint is resolved, but not quickly, only 70 percent will repurchase if they had a minor problem, while 54 with a major problem will repurchase. If the complaint is not resolved at all, 46 percent will repurchase with a minor problem and 19 percent with a major problem.² Clearly, there is a lot to be gained in terms of speedy, effective complaint handling.

Emotionality is stronger when customers complain, and these emotions need as much attention as resolving problems. We recommend a variety of strategies that will add positive emotional value to a difficult situation.