Responding to complaints makes good business sense

Updated: Jul 2

How you respond to consumer complaints, negative comments or allegations of wrong-doing (whether accurate or not!) will determine whether the incident escalates into a crisis and you start losing customers.


If you're a social media manager you are always looking to add more value to your company or to your client.


You are confident using social media for marketing and promotions and engaging consumers around positive messages, but when it comes to complaints, trot out the standard cold PR statement or worse - don't respond at all.


How you respond to consumer complaints, negative comments, allegations of wrong-doing (whether accurate or not!) or being on the wrong side of some emerging issue of the day; will determine whether the incident escalates into a crisis and you start losing customers.


According to Bain and Company, a 5% increase in customer retention increases your profit by 25% plus. These numbers come from different industries and will vary depending on the product, but if it takes 5 to 7 times more effort to find a new customer than keep an existing one, this makes sense.


Companies with great customer retention strategies outdo their competitors in shareholder value, profit and market growth.


I’m Steve Hather from CrisisClarity. We help food and consumer goods companies respond effectively to problems that can lead to a crisis. Through training and real-time simulation exercises, you can not only prevent a crisis but build your relationships with customers and consumers and strengthen your business.


Even the best companies have problems from time to time.


Your response to a consumer complaint, a negative comment on your social media pages, allegations of wrong-doing or being on the wrong side of some emerging issue of the day will have a big impact on customer retention.


Respond well and 92% of customers will be happy to buy from you again. 22% of customers will even become advocates for your products and brands and start telling others.


So the key message is that working on your customer retention strategy - including how you respond to consumer complaints, is one of the best investments you can make in your business.


If you’re looking to improve your customer retention program by engaging effectively when you get complaints on your social media pages, download our free guide "No FMCG company should ever have a reputation crisis - 5 mistakes to avoid" by clicking here.


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© 2020 APAC Risk Institute Pty Ltd T/A CrisisClarity
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