Managing the Exceptions – Using CRM to Salvage Damaged Relationships

Earlier in my career, I covered the telecommunications industry. Nothing better prepared me for a career examining CRM than the sight of enormous corporations with immense customer bases failing to build any kind of relationship with their users and instead resorting to price as their major differentiator.

Worse yet was the service aspect of these businesses. Perhaps because they were in constant churn-and-acquire mode, the resources devoted to service suffered. When something went wrong with a customer’s service, the result was a process that, in effect, punished the customer.

Service calls usually required a customer to stay home awaiting the arrival of a service person, who might or might not be able to diagnose or repair the problem. If it could not be repaired, then the customer might have to repeat the process the next day.

I went through this when I moved houses; the phone provider transposed the digits in my address in the order system and installed my new line in someone else’s house. It took six more visits from service personnel to figure out the problem and get my phone working.

Exceptional Opportunities

As common as they are, these service issues are not the norm. They’re the exceptions — but in cases like these, where there is limited contact between the company and the customer, the exception can seem like the norm. When that happens, the customer’s likely to start looking to buy from someone who promises a better — or at least different — norm.

However, the exception is also an opportunity. Studies have shown again and again that customers who report a problem to a company and then have it remedied in a reasonable way and in a reasonable amount of time are far more loyal customers than those who never experience problems.

No matter how effective your company is at what it does, customers will have problems. How can you use CRM to convert those exceptions into relationship-building opportunities?

Tailor the Response

Step one is to have an organization-wide understanding of this very concept. Too many companies look at responses to customer problems through a cost-benefit analysis prism: “How much will it cost us to really satisfy this customer, and is it more than the cost of losing the customer?” Flip that equation on its head: “How much will it cost to lose this customer, and how much do we stand to gain over the customer lifetime by solving the problem and gaining long-term loyalty?”

How do you get that long-term loyalty? First, of course, you need to fix the problem. Beyond that, understand your customer and why that customer came to you in the first place. That data should already exist in your CRM database.

Understand what customer used as the major criteria in selecting your company: price, features, payment terms, flexibility in capacity, ability to respond to new product requests, or any other aspect of your business that attracted the customer. Hopefully, your sales reps collected this data during the selling process.

Then, offer a token of your gratitude to the customer tailored to take advantage of what initiated the relationship. That might be a discount, some free hours of service, or a complimentary product that you know the customer can use. It should not be some set apology item that’s trotted out in every case — it should be tailored to the individual customer.

Not for Nothing

This is giving something away — but not for nothing. It’s to demonstrate your organization’s good faith intention to make things right and to cement the relationship in a visible way with the decision makers among your customers.

It also pays to train the first line of defense in these situations to start the process of transforming a complaint into an opportunity. That means training for your call center staff to deal with unhappy customers, and giving the staff the power to start the process rolling.

If it’s done right, dealing with these exceptions can ensure not only that customers stay with you after you solve their problems, but also that they remember how well they were treated when they broached their concerns — and perhaps talk to their peers about how your company dealt with them.

If you handle exceptions well, and with the proper mindset, you can convert customers with problems into customer advocates.

CRM Buyer columnist Chris Bucholtz has been a technology journalist for 15 years and has immersed himself in the world of CRM since 2006. When he’s not wearing his business and technology geek hat, he’s wearing his airplane geek hat; he’s written two books on World War II aviation, and his next two are slated for publication in 2010.

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