As stated on his website, “Richard R. Shapiro founded The Center For Client Retention (TCFCR) in 1988 to provide customized research, training and consulting for Fortune 500 companies to generate a higher percentage of repeat customers.” As one also dedicated to helping small- and mid-sized companies learn how to retain and acquire customers, I think he does a great job. His research and advice are normally right on.
However, I take issue with his latest blog posting, The Customer is Always Right. To summarize his points, Shapiro reminds us that “[t]he slogan [the customer is always right] was popularized by pioneer successful retailers like Harry Gordon Selfridge, John Wanamaker and Marshall Field.” Why? So employees would treat customers correctly, take them seriously, and not let them “feel cheated or deceived.” I heartedly support the spirit of this stance. In 2011, a survey was commissioned by RightNow, conducted by Harris Interactive, and produced the 2011 Customer Experience Impact Report. It showed that when customer expectations are consistently not met, 89 percent switch to another company. Another statistic frequently cited in Internet posts is “68% of customers leave because they were upset with the treatment they received whilst speaking to customer service.” (The US Chamber of Commerce is usually cited as the source. But I cannot find it on their site. Please let me know if you ever find it! If it’s on the Internet, it must be true…)
Shapiro caps his argument with a pretty good point: “The Center For Client Retention, which I founded 28 years ago, has conducted hundreds of thousands of interviews/surveys with our client’s customers. The research has shown, 99 percent of the time, bottom line, the customer is right. So why focus on the 1 percent? That doesn’t make sense.”
What makes more sense to me is that 99 percent of the time, most of the customers do indeed think that they’re right. And, for me, this is the issue. Customers have been told for years that they’re always right. Having become quite convinced, many are naturally very upset when they aren’t always treated as such.
Exacerbating this situation are the frequent customer service missteps perpetrated by companies. Let me explain.
First, let me make it perfectly clear that I do not believe the customer is always right. It should never appear in training for client-facing personnel except to eliminate it from everyone’s thought process. Reality proves that the customer is sometimes right. (Self-delusion does not create truth. It just makes subsequent reactions imminently annoying.)
Second, it costs 6 to 10 times to acquire a new customer versus keeping a loyal one. Therefore, I wholeheartedly support and encourage coaching employees to treat customers as though they were as valuable as pure gold. Nevertheless, no employer should allow an employee to be berated by any customer. Though facts may indicate that the client is technically correct, service personnel must be taught to deal correctly with curmudgeons!
Shapiro goes on to say, “Telling the customer ‘no’ destroys whatever loyalty exists.” He states this as an absolute, never to be violated. Again, I don’t agree. In today’s entitled environment—worsened by such thoughts as we’re discussing—such client conversations are inevitable. Doing so, however, requires the expertise and experience of senior staff or management.
Here are a couple of examples to illustrate my point. Surprisingly, Shapiro provides the first one (cited verbatim).
- A loyal customer wants to return an item and the conversation is, “our return policy is 30 days, but we appreciate your business and loyalty and we will accept the return,” is a reinforcing statement. The customer will remain a loyal customer. If the customer is new and you say, “I know you are new to our store and might not have know [sic] our return policy. I will be happy to exchange your item,” is a clear statement to the customer that your business is different and values their patronage.
- The annals of Nordstrom history contain many customer service anecdotes. Every one I’ve investigated turn out to be part of the corporate oral history. In other words, they’re totally unverifiable. Nevertheless, they speak to the importance it gave to customer service. (Past tense as all indications are that they’ve “tightened” their return policies.) A typical story follows.
- The word on the street was that you could return absolutely anything to Nordstrom. It didn’t matter what it was or where it had been purchased. One day, a gentleman walked up to the customer service desk. A large lawnmower trailed behind him. After apologizing for having lost the receipt, he asked to return the contraption—for cash. Never missing a beat, the properly trained service person said, “Certainly. Please wait a moment while I determine what you originally paid for it.” A supervisor “looked up the price” and proposed a refund amount. The customer accepted and counted his money as he walked out the store exit.
Bottom line? The tone of a customer conversation is usually more important than the actual content. Arguing the truth is rarely significant. Learn how to explain, “No,” while saying, “Of course” (or some such). (Basic sales 101 training.) Maintain mutual respect—even when it far surpasses reasonableness. As shown above, Shapiro does address this concept. Unfortunately, the context emphasizes the need to maintain the illusion that the customer always remains correct even at the cost of an employee’s self-esteem. That’s what I find inexcusable!
When reasonableness gets so stretched that it breaks? You should probably fire the customer. I’ll invest in good employees anytime rather than trying to keep a customer who constantly drags them down.