csat stat 68

“A happy customer tells 3 people; an unhappy customer tells 10 people”

 

What’s the background?

There are many variations of this CSAT stat which crop up on a regular basis. You will almost certainly have seen versions of the statistic using slightly different phrasing, and vastly different figures!

So what’s the story? You could be forgiven for thinking that people are simply inventing the figures! Here are a few examples of the variations that you might have seen being quoted:

“On average, an individual will tell 9 people about good experiences, and 16 people about poor ones.” – American Express Survey

“On average, an unhappy customer tells 11 others about their experiences.” – The Sydney Entrepreneur Centre

“A dissatisfied customer will tell between 9-15 people about their experience. Around 13% of dissatisfied customers tell more than 20 people.” – White House Office of Consumer Affairs

The reason for the difference in numbers of people an unhappy customer tells is simply that the studies and research are conducted in different markets, at different times.

Apparently the original “an unhappy customer tells Y others” study came from a piece of research done by TARP for Coca Cola in the 1980s and originally stated that unhappy customers tell “9-10 others.”

Why we all need to move on

The huge (and relatively new) dimension to all this is social media.

The average Facebook user has 338 friends. All they have to do is complain online and it blows all the stats above out of the water.

It’s very easy for a dissatisfied customer to tell literally millions of people if their effort is entertaining enough to go viral – just ask United Airlines, after David Carroll’s “United Breaks Guitars” song did just that.

In this case, 1 dissatisfied customer tells 16 million…

Complaints - an unhappy customer tells
There are even whole websites dedicated to preserving the funniest and most creative complaints efforts on the web:

Dear Customer Relations screenshot

So what should you do? The key to stopping the rapid spread of dissatisfaction is speed of response. To ensure the best chance of recovering the relationship following a service failure, the critical priorities are as follows:

1. Catch the problem early

Giving your customers the opportunity to provide feedback is vital to finding out whether they’re happy…and if they’re not, why not. It may seem counter-intuitive, but it’s good to encourage people to bring you their complaints. If you don’t know what the problems are, you can’t solve them…and those unhappy people will start broadcasting their dissatisfaction.

Regular, timely customer feedback surveys ensure that you find out about problems before it’s too late to do anything about them.

2. Act quickly

It’s vital that you react as swiftly as possible. Any delay will only serve to increase the customer’s annoyance, and they’re likely to start spreading the word.

Contact the customer quickly, and apologize. Even if you don’t have a solution for them just yet, it’s important they know that you’re aware of the problem, and that you’re going to do everything possible to put things right for them.

A customer service alert system can be hugely beneficial in this scenario. If you’re notified as soon as negative feedback is received, you’ll avoid unnecessary delays which might lead the customer to feel their feedback has simply disappeared into a black hole.

3. Understand what’s gone wrong

Find out exactly what’s happened, and why the customer is unhappy. Try to understand the issue from the customer’s perspective – this will give you the best chance of solving the problem and saving the customer relationship.

If the feedback or complaint doesn’t give you enough detail, then actively seek more information. If possible, pick up the phone and talk to the customer. Depending on the problem, you might even be able to solve the issue for them right there and then.

4. Make sure you take action

Once you understand what’s gone wrong, take action to put things right. If the customer feels that you’re just going through the motions of acknowledging their complaint then this will only anger them further…and make them more likely to shout their dissatisfaction from the rooftops.

If you can make things right for the customer, then do so…quickly. It’s also important to take steps to ensure that the problem won’t occur again in the future, either for this customer or for others.

In summary

An unhappy customer has the potential to be very damaging to your business. But if you have an efficient system in place for receiving feedback and acting on it swiftly, you can turn the situation around. You might even convert that unhappy customer into an advocate.

Enjoyed this ‘CSAT stat of the month’ post?

Why not check out some of our other related posts including:

A complaint is a gift

Building a Customer Service Alert System that works

– After the survey: Our 5 step repeatable process for handling customer feedback


Try Customer Thermometer’s super-fast 1-click survey for free now…