Hug Your Haters: How to Embrace Complaints and Keep Your Customers

ALSO BY THE AUTHOR

Youtility

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Copyright © 2016 by Convince & Convert, LLC

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Foreword by Tom Webster published by arrangement with the author

Photograph here courtesy of Subaru of Wichita

ISBN 978-1-101-98069-9

Version_1

For Alyson, Annika, and Ethan

CONTENTS

Also by the Author

Title Page

Copyright

Dedication

Foreword

Introduction

Chapter 1

Why You Should Embrace Complaints

Chapter 2

The Two Types of Haters and the DNA of Complaints

Chapter 3

The Hatrix: Who Complains, Where, and Why

Chapter 4

Customer Service Is a Spectator Sport

Chapter 5

Big Buts: 5 Obstacles to Providing Great Service

Chapter 6

H-O-U-R-S: The Playbook for Hugging Offstage Haters

Chapter 7

F-E-A-R-S: The Playbook for Hugging Onstage Haters

Chapter 8

The Future of Customer Service

Afterword

Appendix: Hug Your Haters—an Easy Reference Guide

Acknowledgments

Author’s Note

Notes

Index

About the Author

FOREWORD

by Tom Webster, Edison Research

In my business—consumer insights—I get all kinds of requests. Some clients ask me to "prove x for them. Those kinds of requests, to paraphrase A. E. Housman, use research like a drunkard uses a lamppost: for support rather than illumination. But all market research can essentially be boiled down to three categories: comparative research (how are we doing?), firefighting (what the heck do we do?), and blue sky research (what could we do?"). The latter is my favorite type of project because we get to be involved in the discovery of new facts and the exploration of the undiscovered opportunity.

It is, in fact, this undiscovered opportunity that my friend Jay Baer has set out to explore, on your behalf.

When Jay first approached me and my company, Edison Research, he had two provocative questions: How has the proliferation of social media, review sites, and other online forums changed consumer expectations of what good customer service really means? When interactions between brands and humans are played out on a public stage, how must brands perform in order to satisfy not only the customer but the customer’s audience?

With our help, Jay set out to discover the answers to these questions, and many more, in order to provide illumination, not support. Together, Jay and Edison designed a significant national research study to examine current expectations of customer service, how they differ by channel, and the value of responding to complaints, even when those complaints seem unresolvable.

The answers surprised us all. To Jay’s endless credit, the book he thought he might write turned out to be a very different book indeed—and a very, very powerful one. The results of the study challenged my own preconceptions about responding to online complaints, and caused me to rethink even how my own business chooses to respond, or not, to haters.

And here’s something that might unsettle you: your business has haters, too. Every interaction between brand and human has the potential to delight or enrage—in short, to become memorable. Today, with the widespread usage of social media, those memories can live on, and live in public, for a very long time. Customer service has become a spectator sport, and your online panel of judges can award or deduct points for speed, execution, and style.

Because that spectator sport can become ugly, many businesses essentially opt out of the game, figuring that it’s rigged. I know that was my inclination before Jay embarked on this exploration. But I was wrong. It doesn’t matter how rigged the game may seem, how vitriolic the haters may be, or how futile it may seem to please them. The game is worth playing.

You might be tempted to write off Hug your haters as a trite saying, a Zen koan, or a beatitude for our digital times. But in the pages that follow, you won’t find cherry-picked anecdotes or feel good mantras imploring you to turn the other cheek. Jay does not argue from anecdotal information, but from research. And he provides context for that research from some of the world’s most successful brands and small businesses, and shows how they have made hugging their haters a systematic process, with tangible results. Jay offers some remarkable case studies of hater hugging and the hard-dollar value that this practice brings to companies that embrace . . . embracing.

What I hope you get from this book is what I got from this book: a change in mind-set. Hugging your haters takes some work. You might be tempted to think about the effort required to monitor and respond to complaints in social media, review sites, and online message boards as a loss center, a cost of doing business. What Jay convincingly argues, however, is that hugging your haters is not a cost. It’s a profit center. Hugging your haters makes good business sense. It’s worth it to do the work, because the work pays off. And the most successful hater huggers have a competitive advantage and a true strategic moat against their competitors.

I hope this book has the kind of impact on you that it did on me. And if it does, may I humbly suggest one simple thing: when you finish this book (for the first time), log on to Twitter, Facebook, Yelp, TripAdvisor, Amazon, or anywhere else your company has been hated and hug your most recent hater.

Doesn’t that feel better?

Introduction

In business and in life, each of us is confronted with people who are perturbed, displeased, disappointed, or downright angry. These people take the time to complain, and let us know where and how we fell short in their eyes.

They are the haters. Their intentions may vary, but there are more of them than ever, and they are louder than ever. And that’s good news.

Indeed, what you’ll discover in this book is that the rise of the haters is an enormous opportunity for businesses and companies of every type and every size. I’ve seen this firsthand, as an adviser to some of the world’s largest companies and an investor in many small start-ups. Business is more competitive than it’s ever been, at every turn and in every way, and differentiation is tough, as competitors can and will eventually mimic your products and ape your pricing. But customer experience and customer service remain fertile opportunities for standing above the mass of competitors. I wrote this book to help all business owners and managers understand how to turn customer service into marketing, and use it as your true competitive advantage.

You may be thinking that this book is unnecessary. You’re already wonderful to your customers. After all, according to a study by Forrester Research, 80 percent of businesses believe they deliver superior customer service.¹

But that same study shows that just 8 percent of customers agree that service is superior.²

As you’ll see in these pages, yesterday’s great is today’s mediocre. What previously would have been considered adequate attention to complaints and haters can now become a major customer experience deficiency that can be exploited by your competitors.

You may be thinking that you already know everything there is to know about customer service, especially if you are actively involved in interacting with your customers every day. And a few years ago, you probably would have been correct. Customer service changed little between the invention of the toll-free phone number in the 1970s and the embrace of e-mail as a contact mechanism in the late 1990s.

The same is true in the field of customer service books and counsel. There are dozens of books on the shelves about customer service, and I cite some of them here. But many of those books, while interesting and worthy of praise, are not relevant in the way they once were. Mobile and social technology, sociological and behavioral changes, and heightened consumer expectations have radically shifted what it means to provide great customer service, and the resources and processes you need to do so.

Hug Your Haters is the first-ever book about modern customer service.

You may also be thinking that you already have a good solution to haters . . . simply ignore them. Your business is successful. Your business has always been successful, and you’ve used the same approach to complaints and customer service the whole time. Why change? If it ain’t broke, don’t fix it.

But it is broken. It has always been broken, we’ve just chosen not to admit it to ourselves. A 2013 Customer Rage study by Arizona State University says it best: Even though companies have substantially increased their spending on handling customer complaints (billions of dollars annually on call centers, enhanced remedies, expanded internet access, etc.), complainant satisfaction in 2013 is still no higher than in the 1970s. Most complainants are dissatisfied with how their customer problems are being handled.³

Think about that. Most complainants (haters, in the parlance of this book) are dissatisfied with how their customer problems are being handled. For the majority of businesses, the only reason we can eke by with our current customer service approach is because our competitors are equally shabby, or worse.

Why do we so often tell the tales of the legendary, great providers of customer service? Why are case studies from Zappos, Nordstrom, and Ritz-Carlton such a shopworn trope? Why do we constantly reference a tiny, familiar menagerie of companies that we’ve all agreed do it right in customer service? It’s because they are different. And they are rare. They have made an organizational commitment to provide superior customer experiences, and succeed at differentiating from their competition as a consequence of that emphasis. Does Zappos sell better or cheaper shoes and clothing than competitors? No. Does Nordstrom? No. Does Ritz-Carlton provide demonstrably better accommodations than other high-end hoteliers? No. But each company uses customer service as a wedge to separate it from similar providers of goods and services.

You can do that, too. In these pages, you’ll find examples and case studies of small and large businesses, many unfamiliar to you, that understand how customer service has fundamentally changed. They understand how customer service is continuing to change even as you read this. And they understand how smart companies are keeping their customers and outflanking their competition by using the principles and playbooks in Hug Your Haters, the most important of which is this:

Haters are not your problem. . . . Ignoring them is.

The tendency of almost everyone (including me) is to turn away from haters. To dismiss their complaints as outliers that are not representative of reality. When confronted with negativity, our instinct is to turn the other cheek, to quote an ancient source, or to ignore the trolls, to quote modern packaging of the same advice.

But today this is the wrong approach, because in an era when much of customer service has become a spectator sport, choosing to stay silent actually speaks volumes. As Dave Kerpen, CEO of Likeable Media and author of Likeable Social Media, says, Not responding is a response. A response that says ‘I don’t care about you.’

Like selling a stock when its value has dropped, staying silent locks in your losses and ensures that your business will not benefit from a complaint—or your response.

Nothing ever gets better when you don’t address it, and yet in this day and age we still see businesses that don’t respond, says George Klein, CEO of customer service mobile app company Peoplocity.

The same shift toward public customer service interactions that has made this book necessary also makes it psychologically difficult to engage with haters, especially when they shine a giant spotlight on their perceptions of your shortcomings. Here’s an example of when the outlandish nature of the complaint from a hater would make you want to not respond.

Yelp is a popular feedback and recommendations website where consumers can review and rate all manner of local businesses. This is a Yelp review that is closer to Greek tragedy, written about a Chicago-area location of the White Castle hamburger restaurant chain, which is popular in the central United States:

While driving to the airport near the end of our Midwestern journey, I heard what appeared to be hyperventilating coming from the back seat of our rental car. My 16-year-old son could not believe he was actually seeing a real live, bona fide White Castle, and he begged us to go in. Since we were pretty early for our flight, we decided to go ahead and let him have his Harold & Kumar go to White Castle moment, a movie which he asserts is the greatest stoner film ever. Stoner Film, like there’s a category for it at Sundance.

Seems like a positive review at this point. But it takes a decided turn for the worse:

I cannot believe that these people actually exchange real American currency for this square, steamed mixture of rodent feces and sawdust on a tiny bun. This is the bastard love child of a 7-Eleven microwavable meat patty and the entrail drippings of roadkill left to fester on Midwestern highways in the hot July sun. Happily it’s as thin as a Post-it note so as not to avoid inadvertently engaging your gag reflex.⁴

Remarkably, on a five-star scale, this is a TWO-STAR review! I desperately want to know what this person writes when he has a one-star experience. In this case, the White Castle restaurant did not respond to the complaint, and perhaps you would have handled it the same way. Don’t feed the trolls, right? But it should have responded, and so should you in any similar scenario. Answering a review, even one as pointedly negative as this one, increases customer advocacy and shows all onlookers that you do in fact care about your customers. You must hug your haters.

Says Scott Wise, owner of the fourteen-location Scotty’s Brewhouse chain of brewpubs, People don’t complain just to complain, they have a legitimate concern, and you need to recognize that as an opportunity, not a problem. My dad taught me the phrase isn’t ‘We have a problem,’ it’s ‘We have an opportunity to improve an experience.’

Wise is exactly correct. And even though the number of complaints they have to deal with is far larger, certain big companies are also starting to understand the opportunity value of addressing all complaints. Dan Gingiss is formerly the head of digital customer experience at Discover Financial Services (best known for the Discover card), where he helped transform the service culture to fit modern customer expectations. He warns not to be afraid of complaints. Not only is a complaint an opportunity to show your great service, but it’s an opportunity to figure out the root cause of what is causing irritants with your product or service, Dan says. It’s truly the voice of the customer. Eliminating fear of complaints really changes how you respond to them.

Eliminating fear, especially of public responses to public complaints, and then answering those complaints is an opportunity. In fact, it’s quite possibly the single greatest opportunity you have to keep your customers and grow your business. And I can say that not as my own opinion but as a fact, based on proprietary research that determined the precise impact of the methods you’ll discover in Hug Your Haters.

In this book, you’ll learn who complains, why they complain, and how to capitalize on those complaints. We’ll also explore why interacting with all haters provides enormous benefits, and what’s holding most companies back from doing just that.

In the first chapter we’ll look at the specific benefits of increasing your focus on customer service and customer experience.

In chapters 2, 3, and 4 we’ll learn about the different types of haters, what they want from you, and where you can have the greatest impact.

In chapter 5 we’ll examine the reasons why businesses are not putting emphasis on customer service (especially online), and how to address these issues.

In chapters 6 and 7 we’ll learn the precise frameworks for how to handle complaints online and offline.

And in chapter 8 we’ll discuss the future of customer service, evaluate new trends that will continue to change how service is provided, and describe what great service requires.

The back of the book includes a quick reference guide, so that you can easily refer back to key statistics and main points once you’ve finished reading. Hug Your Haters is intended to be a book that changes your thinking, but also a resource to which you can refer again and again.

This book was written for you.

This book was written for anyone and everyone who has customers anywhere on the planet. Big companies or small. Business-to-business and business-to-consumer companies. Governments. New companies or old. You’ll learn how to hug your haters, embrace complaints, and keep your customers. Doing so turns service into your best competitive advantage while increasing customer retention and company profits.

Chapter 1

Why You Should Embrace Complaints

As Tom Webster explained in his fine foreword to this book, I partnered with his firm—the highly respected attitude collection group Edison Research—to take a close look at the current state of hate. We discussed customer service expectations and outcomes with more than two thousand American consumers who have complained about a company in the previous twelve months, with the study participants representing a statistically valid cross-section of ages, incomes, racial makeups, and technology aptitudes.

And what we found shocked us, both in its comprehensiveness