„‚ CONDITIONS THAT HINDER EFFECTIVE COMMUNICATION

These efforts dramatically communicate to customers that the company cares, that it
is sensitive to the customer’s business, and that it will stand behind its product or
service—no matter what. The personal responses to complaints at Marriott Hotels and
Resorts, the unquestioned return policy of Nordstrom, the price reductions that
Domino’s gives for late deliveries of pizzas, the guaranteed satisfaction offered on
products sold by L.L. Bean, and the money-back guarantee of the power-quality
program at Pacific Gas and Electric distinguish these companies from their competitors.
Statistics show that recovery efforts pay big dividends (see Table 1).
Table 1. Return on Investment by Corporate Complaint-Handling Units
Industry
Package goods
Banking
Gas utilities
Return on Investment
15-75 percent
50-170 percent
20-150 percent
Consumer durable goods 100 percent +
Electronic products
Retail
50 percent
35-400 percent
Automotive service 100 percent +
From Consumer Complaint Handling in America: An Update Study, Part II by
Technical Assistance Research Programs, March 31, 1986.
Certainly, the benefits of recovery depend on the industry, the company’s
commitment to finding disgruntled customers, the number of people in the company
involved in recovery, and the autonomy given to customer-contact employees who must
act on the spot to transform a dissatisfied customer into a company advocate.
Nevertheless, the benefits of a well-developed recovery strategy far exceed the costs.
Unfortunately, most recovery processes are much less effective than they could be.
Most companies attempt recovery only after a customer initiates a complaint, yet a great
majority of customers do not complain even when they have significantly dissatisfying
experiences. A study by Technical Assistance Research Programs (1986) indicates that
as few as 4 percent of dissatisfied customers complain, leaving 96 percent of them to tell
their negative stories to others and simply not return. An effective recovery strategy
requires that a company encourage its people to find disgruntled customers and reward
the people who do find them.
The Pfeiffer Library Volume 6, 2nd Edition. Copyright ©1998 Jossey-Bass/Pfeiffer ❚❘ 405