- Customer Service
- Customer Service 101
- Championship Points
This chapter is from the book
This chapter is from the book
This chapter is from the book
Customer Service 101
Hundreds of responses exist to the question, "What is customer service?" Depending on whom you ask—or which side of the counter you are on—you will hear a wide range of answers. Through all these responses, three prevailing principles have emerged.
First, every company must determine for itself the role and importance of customer service. Next, every employee must add value to the buying process. Finally, customers ultimately determine the value attached to service.
Once these principles are communicated and reinforced throughout a company it will be positioned to deliver the high levels of customer satisfaction that will enable it to not only retain its current customer base, but also to extend it. Customer retention experts JoAnna Brandi, Howard Hyden, and Chuck Reaves believe companies that excel at customer service have addressed and considered the following eight service principles, tenets, and issues: 3
Building customer loyalty
"Moments of truth"
The value of service
Employees: The internal customer
Customer service makes the difference
What do your customers think?
Turning complaints into devotion
The customers who got away
Building Customer Loyalty
Establishing customer loyalty is one of the most overlooked yet critically important elements in building a successful business. Companies traditionally allocate resources to gaining customers, not keeping them. Once a customer is gained, his or her loyalty must be nurtured and never taken for granted because the costs of replenishing, or churning, customers is simply too high.
If you want to know how to treat a customer, look no further than the Kane County Cougars, a Midwest League single-A minor league affiliate of the Florida Marlins that plays in Geneva, Illinois. Located within an hour's drive of both Wrigley Field and Comiskey Park in Chicago, the team claims to have sold out almost every game since it began play in 1991.
The Cougars drew about 3,500 fans per game during the team's first year, leading the team to expand its stadium's seating capacity to 4,800 seats. Even that expansion was insufficient. The per-game average hovered around 5,000 fans when standing room and other special tickets were included in the count. During the Cougars' first five seasons in the league, total attendance increased 97 percent. Year after year the team has continued to post impressive attendance levels even as a single-A team. It now routinely finds itself among the top 15 in attendance throughout the entire minor league system, averaging close to 8,000 fans per game.
Fans weren't showing up in droves because the Cougars had great players; Marlins first-round draft pick catcher Charles Johnson is one of only a handful of recognizable players to have been on the Cougars' roster. Minor league teams can't market their players easily because their function by nature is to develop them enough so that they'll be promoted to the "big leagues."
This creates an interesting dichotomy, because a winning team with great players obviously helps, but those teams that learn how to cater to their customers, like the Cougars, have no problem with player movement. The team didn't win its first league championship until 2001. However, three seasons before, the Sports Business Journal named the Cougars the top fan-supported team in the Minors. Each minor league team's 1998 box office performance was analyzed in four categories: average attendance, on-field record, area population, and stadium capacity.
So, what's the secret? It starts with affordability. Inexpensive ticket prices, ranging from $5 to $10, are combined with fun, fun, and more fun as the team constantly provides a great game-day experience. In addition to the game itself, the between-innings breaks are loaded with great family entertainment. Water balloons are fired into the stands by giant slingshots. Perhaps Jake the Diamond Dog is retrieving foul balls for the umpire. There might even be a peanut butter sandwich-making contest or pigs dressed in costumes running bases.
The Cougars set out to fill a family niche, and do so while appreciating that baseball is a slow game. The team is aware that it has to do something for the kids, and for moms in particular. The Cougars know that although they might play baseball, the team is, in fact, part of the entertainment business.
If there's any star that's constantly being promoted for the Cougars, it's the team mascot Ozzie T. Cougar, who—in what is perhaps the embodiment of a winning proprietor–customer relationship— races kids around the bases and always finds a way to let them finish ahead of him.
The Cougars have realized how to build their customer base. It's often the child that brings the parents in but the team has to give mom something to do while dad watches the game and the kids play.
To draw first-time customers, Ozzie sponsors a reading program that started in the mid-1990s with 40 Chicago-area schools and has expanded it tenfold, with about 125,000 potential customers who can each beg parents to go see Ozzie at the ballpark.
Once in the ballpark, the emphasis on bringing something Ozzie-like home, to remind that child of the experience, is very strong. During the 2001 season, the Cougars provided free Ozzie tattoos, Ozzie growth charts, Ozzie baseball cards, Ozzie posters, Ozzie bobbleheads—you get the idea.
Building loyalty extends beyond the initial or on-site sales experience. Providing customers with a positive and lasting experience puts companies in a positive light and keeps them top of mind to consumers.
For minor league teams, it's the promotional item that fans can take home to remind them about the fun time they enjoyed at the game and about their affiliation with the team. Other companies might hand out calendars or sticky notes with their address and phone number. For a department store like Nordstrom's, that extra something is a business card with your particular salesperson's name on it. The card not only formally establishes a relationship with the customer after the sale, but it also subtly reminds them to return when they see the card in their wallet.
Whatever it takes to build customer loyalty, even if it's something small or potentially perceived as inconsequential, should be undertaken. Failure to do so jeopardizes a business's chance for success.
"Moments of Truth"
Building on this first principle, "moments of truth" can make or break a company's chance to gain loyalty. Every time a customer comes in contact with a firm, there is a chance to gain—or lose— that customer for life. It is necessary to make sure that customer feels special every time. Conventional wisdom says that one usually remembers the beginning and end of an event, not the middle. Appropriately, sports teams have taken advantage of these moments of truth to improve customer service.
How teams help fans when they lose or misplace their tickets can provide a positive "moment of truth" experience. Season ticket holders for the Saskatchewan Roughriders of the Canadian Football League, for example, can show up without their tickets once and still get into the game. The second time, they have to pay the game-day price, but if they find their ticket a couple of weeks later, they can get a refund. Many teams reissue stolen tickets to a customer as long as he or she comes with a copy of the police report.
Moments of truth also arise during events and can have a profound effect on how organizations are viewed by (potential) customers.
The University of Southern California (USC) had a basketball season ticket holder who had been attending games since 1950. After submitting his credit card order to pay for season tickets to the Trojans 2001 season, he received a letter from USC informing him that unless he joined a booster club costing an additional $2,000, his seats would be moved from the section he had occupied since the Sports Arena opened in 1959.
The ticket holder was terminally ill from cancer and apparently too sick to call USC himself, so his son contacted the athletic department and informed them of his father's condition, but was told that other options did not exist. Apparently the school had a policy, and that was that. An athletic department representative was even reported to have told the son that he'd have to pay $2,000 or be reassigned to nondonor seats.
An executive of the Better Business Bureau even volunteered the bureau's services to investigate USC after hearing the story. He believed that it was possible that USC was breaching a contract with the fan because he already had paid for tickets.
When school officials became aware that the Los Angeles Times was looking into the incident, it reacted swiftly to quell any further damage by moving the ticket holder only 20 seats away—without requiring the $2,000 payment. However, by that point the damage had been done. Although USC believed that extenuating circumstances went unreported, the dollar amount of the ill will and bad publicity generated by the paper's coverage of this customer service debacle greatly surpassed the additional revenue sought by the athletic department.
"Moments of truth" can also be sought out.
Just weeks after USC created ill will through its handling of this basketball season ticket holder, it was presented with a golden opportunity to demonstrate its commitment to, and appreciation for, its fans.
A USC student who thought he had won a $10,000 scholarship during halftime of the Trojans' game against UC Santa Barbara later learned that he would not get the money because he was over the line on two of the four shots (a three-pointer and a half-court shot) he had to make.
The student, a sophomore broadcast communications major, later acknowledged that he was over the designated line after reviewing the videotape. USC's director of event marketing said the decision was out of the school's hands because USC hired a promotions company, SCA Promotions, to handle the contest.
The USC executive indicated that he'd like to pay the student, but the money wasn't the school's to give. USC said it understood the student's disappointment, but stated that he was so far over the line on his half-court shot that it couldn't feel sorry for him.
Although USC was under no legal obligation to make good on the promotion, it could have stepped up and honored the spirit of the promotion, generating a customer for life. USC had several options at its disposal. First, it could have honored the promotion. Next, and in tongue-in-cheek fashion, it could have honored part of the promotion. Because the half-court shot was from 50 feet and apparently the student was 2 feet over the line, USC could have paid the student $9,600, or 96 percent, and generated tremendous goodwill in the process. Alternatively, the school could have worked the phones, calling on its list of athletic department sponsors to see if any of them would be willing to pony up by funding a scholarship for this student.
Although the issue of customer service in this case rested squarely with SCA Promotions, ultimately it was USC that was vulnerable, leaving many fans to think, "There they go again." Just because a particular customer service experience falls outside of a company's legal obligation doesn't mean they won't face a backlash from customers who perceive them as responsible.
SCA Promotions later demonstrated that it understood this concept when it decided to give the student the full prize. The company considered the circumstances and felt it was the right thing to do. SCA Promotions thought that because the contestant made the shots, and handled himself pretty well when he was told he wouldn't get the money, it would honor the commitment even if the company technically didn't need to.
During the 2000 season, San Jose State football player Neil Parry had to have his right leg amputated below the knee after a teammate rolled over on it during a kick return. Two seasons later, Parry—having endured some 20 surgeries—was determined to return to play again even though he would be forced to do so with a prosthetic leg. A month before his scheduled return to the field, the NCAA's insurance carrier, Mutual of Omaha, informed Parry that if he were to play his medical bills (which had already risen to $400,000) would no longer be covered under its catastrophic injury policy.
Outrage filled the air on sports talk shows across the country once Parry's situation was made public. Because they realized they had an opportunity to create a "moment of truth," Mutual of Omaha, received approval from the NCAA the next day and reworked Parry's insurance to include lifetime coverage of his medical bills, averting what would have rapidly been perceived as a monumental breach in customer service.
In some cases, organizations actually go out of their way to ensure that customers have that "winning" feeling about their business.
Buck Rogers, one of the most innovative GMs in Minor League Baseball, provides a compelling example of this. While serving as GM of the Lake Fear Crocs, Rogers ran a promotion in which if a player hit for the cycle (a single, a double, a triple, and a home run all in the same game) any time during the season, a lucky fan would win an $8,000 gift certificate toward a new Harley-Davidson motorcycle. One night, a Crocs player named Noah Hall came up in the ninth inning having already hit a double, triple, and home run. Hall, in a close game, was given the assignment of bunting to advance a runner. However, when the third baseman bobbled the ball and Hall was called safe at first, Rogers made sure the official scorer knew to give Hall a hit, so that a fan could win the prize. "We'd like all our fans to win," said Rogers, noting that the insurance company didn't have a case because the bunt was officially scored a hit.
How businesses create or respond to moments of truth has a long-lasting impact on the way they are perceived by customers and noncustomers. Accordingly, it is critical for these high-profile events to be handled professionally and with the utmost concern for the customer.
The Value of Service
The third principle of customer service is the value of the service itself. Customer service must be valued by the firm and considered as important as any of its products. It must consistently meet the demand for service or risk long-term damage to the customer relationship. The sale itself is not the only part of customer service that is important, but a company must offer great after-purchase service to earn that loyalty.
Before the salesperson closes the sale at your local electronics store, odds are that he or she is going to ask you if you want to buy an extended warranty after the product's initial guarantee expires. Retailers that offer this service might be missing an opportunity to establish a long-term relationship with the customer. Because the odds of the retailer having to go out-of-pocket are minimal, the store can afford to pay these marginal costs in exchange for differentiating itself from the hundreds of electronic stores selling the same exact product.
Want another reason? What do you think happens when customers have to bring a product back for repair? They have to walk into the store again and they might see something else they like. Because not enough people choose to take the extra guarantee, once the initial warranty lapses—and assuming the customer has bought nothing else—the store has jeopardized the link with that particular customer.
If the customer doesn't have a problem with the item, the electronics store that offers a free extended guarantee has, nonetheless, favorably positioned itself. At the point of purchase, they established a relationship that many other electronics stores hadn't because they saw the immediate revenue possibilities of selling product insurance instead of the long-term revenue generated by loyal customers.
Kansas City-based electronics retailer BrandsMart took this concept one step further. For the week of October 31, 1999, BrandsMart took out a conditional rebate policy with a sports insurance company. The promotion they ran in area newspapers stated that if the Kansas City Chiefs shut out the San Diego Chargers (who hadn't been shut out in seven years) on Sunday, everything bought in the store from Wednesday through game time for more than $399 would be given a full rebate. That's right—it would all be free.
Business flowed that week and, thanks to the promotion, BrandsMart Director of Advertising Rick Burt said that the day before the game was the most profitable sales day in history. However, the company got its best value when the Chiefs blanked the Chargers, 34–0 and 325 customers walked away with a total of $425,000 worth of electronics. Plus, there was the uncalculable publicity. After the game, word circulated throughout the Chiefs locker room about the promotion and BrandsMart made its way onto ESPN's SportsCenter that night.
Putting a price tag on the value of stellar customer service might not always be as easy as it was for BrandsMart, but quantifying the return on investment associated with service is becoming as important as tracking any other measurable part of a business.
Employees: The Internal Customer
Companies can attempt to incorporate each of these initiatives into their business, but if they don't have the right people implementing them, customer service won't be handled properly. Companies must invest in their hiring and training. The first step is to hire people who will thrive in the firm's culture. Firms must continue investing in their employees by continually training them and giving them the opportunity to be experts. This training must focus on the customer while challenging employees to think of ways to simultaneously create value for the customer.
When companies hire interns they often allow them to dabble in many capacities throughout the organization. After a couple of months, an intern spending a little bit of time in each department and communicating with a variety of people can learn more about the current state of business than a middle manager, who sits in his or her office and "manages" without surveying the work environment.
Solid training programs, regardless of various entry levels, should enable the worker to understand all aspects of related company business. After all, the more an employee knows about the company and the business environment in which it operates, the better able the company is to adequately service its customers.
Minor League Baseball teams train their employees well by all but mandating that they participate in every aspect of the organization. A radio broadcaster for single-A team is often the same person charged with designing and writing features for the game program, as well as selling advertising in it. Ticket takers also sell merchandise and concessions.
One of the most important details, providing stellar customer service, is everyone's responsibility, including the team owners and GMs. Buck Rogers, who planned and executed invasions as a member of the 82nd Airborne Division, compares his employees to private agents, in that they know so much about everything. "Even the interns know a little bit about their boss' job … and their boss' job … and on and on and on," Rogers said.
In addition to overseeing all aspects of the game's operations, Minor League Baseball owners—unlike some of their counterparts in MLB—seek out fans to solicit their input on everything from the quality of the hot dogs to the cleanliness of the restrooms.
Because Minor League Baseball appreciates the importance of showing new employees how the whole system works, it puts itself in the enviable position of better understanding the wants and needs of its fans.
Business owners and managers must decide for themselves how important it is to the company that its employees are well rounded and can pitch in to accomplish just about any task. It's certainly important to companies that sell services, such as Kinko's. Most people don't walk into their local Kinko's because the company necessarily has the best equipment in the world. They come because they need help doing something they can't do—or don't have the time to do—on their own. Should one or two of the five employees not know how to complete a specific task, it can significantly slow down business and frustrate harried customers in the process.
Companies like Kinko's demonstrate that competence is the most important attribute the company has to offer. These companies appreciate the importance of listening to customers, understanding their problems, and applying the company's knowledge to come up with creative solutions critical to success.
Customer Service Makes the Difference
The fifth principle suggests that customer service makes the difference. These days, product quality does not always translate into a competitive advantage. With technologies improving, the differentiation between the qualities of certain products has decreased. Firms are realizing that service can be the competitive advantage that keeps customers coming back. With the amount of entertainment available to the average consumer, it is necessary for professional sports teams to get a leg up on customer service. With customer-friendly new stadiums, a seemingly endless number of ushers, and other value-added offerings, many teams are taking this step and trying to provide value to their customers.
Rogers never forgets the competition he's up against in Daytona, where trips to the beach represent an inexpensive entertainment alternative. Once, while walking through the stands, an elderly man spilled all four of the beers he was carrying on Rogers. As the man was cleaning himself up, Rogers asked him what type of beer he spilled. "Bud Light," he said, confused why Rogers cared. Within a couple of minutes, Rogers had introduced himself and offered four new beers to the man. For $3.12 (actual cost of the 72-ounce beer refill), Rogers made a customer (a fan) for life. In this case, it meant much more because the man was the CEO of a nearby company and told the story at a board meeting the following week.
Increased customer service in stadiums and arenas can be seen in the growth of gourmet food over the past decade. Since the gourmet trend at sporting events took off with new stadiums and luxury boxes in the early 1990s, upscale caterers Levy Restaurants and Sportservice have each expanded their accounts to more than 20 sports facilities each.
At Veterans Stadium in Philadelphia, fans in luxury boxes can order roasted vegetable napoleon. At St. Louis Cardinals games, if fried raviolis aren't good enough (they make 12,000 per game), a food service company can provide affluent patrons almost anything if given a couple days' notice. Rolf Baumann, executive chef at Busch Stadium, said that venison and fois gras aren't out of the ordinary. How far will he go to get the right item? "We had people coming from different countries and whatever a person wanted, we had to have ready," Baumann said.
To the Outback Steakhouse chain, delivering something of value includes its curbside/drive-by service. To make picking up an order easier, Outback restaurants across the country simply opened a 60-square-foot separate entrance on the side of the building with its own designated parking area. When placing orders, customers are asked for the make, model, and color of their car and, on arrival, courteous employees hand customers their order. Outback executives were clearly thinking outside the box. Why can't non-fast-food restaurants have drive-up windows? By offering this service to customers, Outback has seen takeout orders increase. Not only do customers not have to get out their cars, but Outback now has less congestion in the restaurant and can save valuable parking spots for those that are dining in.
It doesn't matter what products or services a company offers when it comes to customer service making the difference. Providing customers what they want—particularly if it cannot easily be found elsewhere—adds value to the purchase experience and enables companies to differentiate themselves from the competition.
Unless management makes it clear, and then constantly reinforces to employees that customer service is important, line employees—those in direct contact with customers—won't attach the requisite value to it. It's hard for an employee of the Seattle Supersonics, for example, not to realize how important customer service is after watching the actions of their owner and Starbucks chairman Howard Schultz. Schultz spends time on the phone talking to former season ticket holders about why they didn't renew and has allowed young fans to congregate courtside before the game for the pregame warm-ups. He even allows them to spend time on the court after the game.
What Do Your Customers Think?
A company might think it is doing right by its customers but it seldom knows for sure. Accordingly, the managers and decision makers must get feedback from their customers to confirm their beliefs. Customers, employees on the front lines, and even prior customers, can be great resources for this feedback. It doesn't matter how you get the feedback, just as long as you get it.
Most firms measure success by profit, but in a customer-intensive firm, customer satisfaction must be a primary contributor to overall success. Besides the obvious feedback, referrals, and repeat business, firms must take other steps to measure satisfaction.
Washington Capitals owner Ted Leonsis and Dallas Mavericks owner Mark Cuban are leaders in the sports business world because they listen to their customers and regularly communicate directly with them via e-mail.
Leonsis and Cuban also benefit because each demonstrates that he is in touch with his customers. One fan e-mail a day directed to Cuban goes straight up on the team Web site, DallasMavericks.com.
Leonsis frequently recounts the story of a fan who asked him if he could tell a vendor to change his route so that he could get some cotton candy during the second period. "I forward it to the facility department and copy the sender of the e-mail with a note such as "make it so," Leonsis wrote via e-mail. "And then I get a response (from the facility department) that says 'it will happen next game.'" Two days later, that fan e-mails Leonsis, copying 15 friends saying, "Wow, I can't believe you took care of my request so fast and so efficiently." 4
Leonsis says he learns more directly through fan feedback than from studies or even his own employees. Feedback includes comments about the arena's sound system, wait time in concession lines, and player wish lists.
For Leonsis, knowing if he is doing a good job doesn't just include e-mail interaction. "I also have my box and me put on big screen from time to time," he said. "If they boo, we need to improve. This is the best indicator of how we are doing."
Mark Cuban is among those owners sensitive to the white-collarization of sports and its impact on fans and their in-arena service. Cuban's Mavericks play in the American Airlines Center, a corporatized arena (of which Cuban owns 50 percent) that opened in 2001 at a cost of $420 million, making it the most expensive indoor sports venue ever built in the United States. With its 142 suites, some priced as high as $300,000 annually, and 1,936 club seats ranging in cost from $7,000 to $18,000 each, the arena has a decidedly corporate feel to it.
Despite the arena's corporate look and feel, Cuban remains intimately involved with his team and its fans. He believes that there's a difference between running a business and owning a business. In the case of the Mavericks, Cuban is doing both and paying keen attention to customer service in the process.
Cuban knows that the fans are the whole reason he's in the coveted position he is in. He recognizes the symbiotic relationship whereby the more fun the fans have, the more fun the players have. Cuban realizes he can't make any game-winning shots, but as far as the fans are concerned, he certainly can respond to any issues they have. Because Cuban believes his fans are the best quality-control mechanism available, he freely hands out his e-mail address to gain feedback. Fans will tell Cuban if there's bubble gum on the seats. They'll tell him if there aren't enough signs in the parking lots and if they can't find their car. He'll listen and fix any concerns immediately. Cuban remains hopeful that his immediate recognition and response approach will spread to the entire NBA.
Cuban understands that, at its core, owning a sports franchise cannot be a long-term, profitable venture without listening to customers. Although corporations are paying most of the bills, Cuban realizes that sponsors are only doing so because they believe the Mavericks provide them a great marketing platform. Should Cuban alienate Mavericks' fans, it would have a serious financial impact on his business because corporations would be less interested in linking their brands to his.
Letting customers know that you are personally engaged in their experience is more critical than you think. Customers often fail to provide important feedback because they don't believe organizations are paying attention to them.
Survey postcards that are sent out in the mail to patients following a hospital stay or to guests after they stay at a hotel don't have a very high response rate. Once someone sees the generic corporate address as the return address, rather than a particular customer service representative's handwritten name, the sentiment is, "Why bother if it doesn't look like they are going to read it?"
Like the Kane County Cougars, the Dayton Dragons is another single-A Minor League Baseball team that routinely sells out, but they never take customer feedback for granted. Fans who have a complaint or a suggestion simply fill out a "One-to-One" contact form, which goes directly to team president Rob Murphy. Team policy dictates that every letter and e-mail is answered and every phone message is returned within one business day. Employees who follow through on great service are recognized with a certificate of excellence, and managers who service customers exceptionally well are rewarded by team management with a Dale Carnegie class of his or her choice.
Establishing an environment in which employees benefit from redoubling their customer service efforts can literally and figuratively pay dividends.
One of the best companies that shows it bothers to read feedback is Whole Foods Market, now the largest retailer of organic and natural food products in the world. Whole Foods started as a small store in Austin, Texas in 1980, but now has more than 120 stores across the United States.
When you walk into a Whole Foods store you will likely see a big bulletin board that features customer comments, as well as timely staff responses to shoppers' questions. This service not only gives customers a sense of worth with Whole Foods management, it also empowers other customers that see that Whole Foods is committed to addressing any and all concerns of its shoppers. The bulletin board also serves as a high-profile reminder that customer service matters.
The more contemporary version of the traditional bulletin board is, of course, the Internet. Popular online auction site eBay, which has more than 1 million sales postings a day, is merely a "marketplace" where people bid for others' goods. Although none of the money for the actual items changes hands through the company, one of the reasons eBay has survived the dot-com collapse and become the leader in online auctions is because its customer service is unrivaled by competitors.
Over time, thanks to feedback in its early days from the site's message boards, eBay developed an effective system of response. If a customer is unhappy with the service he or she is getting from the seller, they can leave negative feedback, which will often affect the seller's ability to make future sales. eBay even provides sellers with the ability to send a reminder of payment due to buyers, who can also be influenced by negative feedback. Without the site's support of mechanisms like these, a lack of trust and inability to make the sale in person could limit eBay's success.
In the sports world, the Internet has even been used in an attempt to get rid of a hometown's goods. A disgruntled group of Chicago Bears fans created www.tradecade.com, which asked their beloved Bears to unload the team's 1999 first-round draft pick, quarterback Cade McNown, after he went 3–12 in his first two years in Chicago.
During an eight-month period in 2001 more than 15,000 signatures were collected on the site. In August 2001, McNown was finally traded to the Miami Dolphins. The following season, without the much-maligned McNown, the Bears made the playoffs for the first time since 1994. Did the Bears management make the trade just because of the online petition? Of course not, but it allowed customers the opportunity to express their frustration about the product, and to do so in a way that got management's attention.
Paying for feedback also works well, provided you spend wisely. At the end of the 2001 season, Buck Rogers, while with the Daytona Cubs, spent less than $100 on sodas, hot dogs, and a keg of beer, and invited all fans to attend "a feedback session." About 50 or 60 fans turned out and Rogers learned quite a bit about issues and concerns that had never crossed his mind (e.g., one season ticket holder said that four games were rained out, so Rogers refunded him four games on the following season's ticket). When Rogers told his friend, who worked at a large Internet server company, the friend responded, "I work for a Fortune 500 company. By tapping a couple kegs and cooking some hot dogs who would have known that you could get feedback so cheap?"
Understanding what your customers think about the company and the products it offers is so important that any means necessary should be explored to ensure that accurate feedback is being generated.
Turning Complaints Into Devotion
Turning complaints into devotion can be a great opportunity for a firm to learn from its customers. Learning from these complaints, appeasing the situation, and doing so quickly should help protect the customer relationship.
One Thursday night (the day of the week when the Daytona Cubs have 99-cent beer night) a mother approached Rogers and told him that the man in front of her and her young child wouldn't stop swearing. When Rogers offered to change her seat, she told him that the rowdy fan was so loud that she thought she would hear him swearing from anywhere in the park. Because of this experience, she said, she would never come back. Rogers, unable to kick the man out, gave the woman his number and said that the belligerent fan was not a "regular" and that she and her son could come back on his dime. Not only that, Rogers said that when they did, her son could throw out the first pitch. Not surprisingly, the woman and her son returned—and more than once.
Customer concerns also arise prior to making the purchase decision and can have grave consequences on an organization's viability.
Tim Eernisse, an executive with the Continental Basketball Association's Grand Rapids Hoops, wasn't expecting to see 15- to 20-minute lines at the ticket window for the Hoops opening game of the 2001–2002 season. He carefully watched for fans that decided to balk at the long lines. When he saw one man and his family give up before getting to the box office, he ran after them, sat them down free of charge and gave them hot dogs and sodas. "They came to at least six of the first seven games and I honestly don't think they would have ever come back if I didn't go after them."
It is also prudent to have a strong internal system for handling complaints so that upset customers don't voice their dismay in a much broader forum. After not receiving an adequate response to two letters complaining about service during a trip to Hawaii and Japan on United Airlines (UAL) Jeremy Cooperstock started a Web site called Untied.com.
"Have you suffered a bad experience with United Airlines?" the Untied.com complaint forum asks. "It might come as a small consolation to know that you're not alone. Since Untied.com has been collecting them, we've received thousands of letters from people like you, who have been treated with disdain by a company getting rich from your travel dollars. These pages probably won't solve your problems, but they do provide a forum where you can share your experiences with others, and hopefully, embarrass UAL into making amends."
At Untied.com approximately five complaints are received per day ranging from refund problems and airplane food to employee rudeness. United spokespeople have said the best way to get a quick response is to contact United directly, but apparently that hasn't worked satisfactorily because the need for the site still exists.
If United had an appropriate forum for customers to voice their complaints, Cooperstock's site would not be receiving 20,000 hits a month—20 of which he says come from United's headquarters on a daily basis.
When UAL CEO James Goodwin stepped down in October 2001, Cooperstock, who says his site isn't meant to be an anti-United site, offered to help new CEO John Creighton create a more adequate system to field complaints. However, the site is still actively taking complaints and forwarding them to the customer relations managers at United.
Remember that it costs less to keep a customer than it does to replace one. Although only 10 to 15 percent of all customer complaints are voiced directly to the company, if these complaints are not resolved to the satisfaction of the customer, significant damage is inflicted on the company's brand name and balance sheet.
Identifying, acting, and following up on complaints will help a company turn disgruntled customers into devoted ones.
The Customers Who Got Away
The last principle a firm should observe is which customers are "getting away." It might be acceptable to allow certain customers to walk away provided they are being replaced with more desirable ones. A company's strategy helps dictate which customers it can afford to lose and does so by providing a framework for valuing each customer. Minor League Baseball values the "everyday" fan, whereas much of big-time sports seems to cater more to the corporate fan, allowing these everyday fans to get away.
By most accounts, Los Angeles' Staples Center has been a tremendous success. Since its opening in 1999, it has hosted an extraordinary number of diverse nonsporting events ranging from concerts featuring Bruce Springsteen and the Eagles, to major international gatherings, such as the 2000 Democratic National Convention and the Latin Grammys. In addition to hosting hundreds of Los Angeles Kings and Clippers games, the Staples Center claims the three-time defending NBA champion Los Angeles Lakers as its premier tenant.
This compelling and unparalleled combination of sports and entertainment events—more than 200 annually—has enabled the venue to market itself as "The Entertainment Capitol of the Entertainment Capitol."
Prior to establishing itself as the premier venue for sports and entertainment's top events, the Staples Center had to create and market its vision to corporations and Los Angelenos alike. Given the region's unwillingness to allocate tax dollars to the pursuit of sport, those desiring to provide Los Angeles with a world-class entertainment venue had to turn to corporate America to finance their vision.
Once this decision was made, everyday sports fans were allowed to get away as they possessed neither the influence nor cash to materially affect the process. In the overall scheme of things, they became less important than corporate America.
Revenue streams pledged to financing the construction of Staples Center came from the following categories, with a distinct and disproportional corporate feel:
Luxury suites: 33 percent
Corporate sponsorships: 29 percent
Premier seats: 17 percent
Naming rights: 11 percent
Concessions: 9 percent
Ticketing agreement: 1 percent
It should come as no surprise that the Staples Center was built by and for corporate clientele, resulting in the need for the venue's management team, which also maintains an ownership stake in both the Kings and the Lakers, to consistently cater to that corporate clientele to ensure its long-term cash flow. The apparent marginalization of the everyday fan at many of America's sports venues makes industry observers squeamish because they believe it could lead to a long-term erosion in traditional fan bases.
Many franchise owners have become overwhelmingly reliant on corporate customers while pricing everyday fans out of the in-venue experience. This has taken place because many modern-day owners are more preoccupied with maximizing short-term revenue than they are with protecting the long-term viability of the leagues in which their teams compete.
Understanding precisely who the core customers are is essential when crafting customer service relationships. Once core customers are earned and kept, attention can then be devoted to accessing additional customer bases. In the case of Minor League Baseball, this begins with families and then extends to corporations. Throughout much of big-time sports, the reverse is the case. Customers, whether everyday fans or corporations, must be identified and properly serviced if a business is to prosper.