Why Customer Complaints are Good for Business

Find out why customer complaints are actually GOOD for business and how to use them to your advantage.
Why Customer Complaints are Good for Business
August 2, 2019

Some food service workers take complaints too personally, while others assume that every complaining customer is just looking for a free meal. While there are certainly some unjustified complaints, most customer complaints are legitimate and something your business can learn from — and use to its advantage.

Below are the top four reasons why customer complaints are good for your business.

1. Customer retention is way cheaper than customer acquisition

An unhappy customer can be difficult to deal with, but they’re the best kind of customer — because they give you a chance to keep their business. More often than not, customers don’t give you that chance. They simply walk away and give their business to your competitors. In an industry as competitive as yours, you can’t afford to let that happen.

It costs roughly seven times more to acquire a new customer than it does to retain an existing one; retaining unhappy customers through the satisfactory resolution of complaints can have a dramatic effect on your bottom line.

In fact, it is estimated that a two percent increase in customer retention has the same effect as decreasing costs by ten percent. If you handle the complaint well, not only will you keep the customer, but you’ll avoid losing other customers to negative word-of-mouth.

2. Complaints give you a chance to protect your reputation

Recommendations from family and friends remain the most credible form of advertising; 84% of consumers report recommendations from family, colleagues and friends as the most influential source for trustworthiness of a particular company or product and 20-50% of all purchasing decisions are driven by word-of-mouth.

That makes word-of-mouth marketing the single most powerful form of advertising and one that has a substantial impact on the buyer’s journey. If word-of-mouth impressions are five to 100 times more powerful than paid media impressions, then negative word-of-mouth can have a devastating effect on your reputation (and profit margins). 

A customer who complains to you privately is giving you a chance to remedy the situation. How you handle it will determine what that customer is going to do. It’s important to remember that most customers don’t leap straight to a negative online review after a poor dining experience unless something went very, very wrong or no resolution was offered.

3. Complaints identify problems in your business

A customer complaint highlights a problem, whether it’s with your product, employees or processes. By listening to your customers, you can use their feedback to improve your product or service and avoid future complaints.

Keep a record of the reasons that customers complain and the details of those complaints. Review these records regularly (at least once a month), investigate what went wrong and figure out how you can prevent it from happening again.

Ask yourself:

  • How often does the same complaint arise?
  • Has the same customer reported this previously?
  • Are there any patterns or trends that emerge?

Look for patterns such as:

  • specific employees on shift
  • type of food / specific dishes that receive more complaints than others
  • day of the week / time of day where complaints come in more frequently
  • type of complaint (service / product)

For example, frequent complaints about undercooked food may indicate that your kitchen staff needs formal food safety training to teach them (or remind them) about safe cooking temperatures; a higher-than-average number of complaints about your weekday lunch service could reveal a need to schedule more employees to work this shift.

By identifying where your business is falling short, you can take corrective action to improve your customers’ experience, thereby decreasing the number of complaints you receive and the costs associated with them.

4. Complaints make you better at handling complaints

Complaints are inevitable. Despite your best efforts, mistakes can and will happen. Generally, people are pretty forgiving of mistakes — how you choose to handle a complaint is what makes the difference between keeping or losing a customer.

The good news is that the more complaints your team handles, the better they get at handling them. Dealing with angry customers can teach employees valuable skills, such as de-escalation techniques and staying calm under pressure. Customer complaints can also help you to develop your business’s customer complaints policy.

It’s true that some customers will exaggerate or even fake complaints to get discounts, a free meal or other compensation, but these types of complaints are few and far between. Treat each customer complaint as an opportunity to improve your product and deliver a better quality of customer service. In doing so, you are making a commitment to your customers, who are likely to reward you with repeat business and positive word-of-mouth.

Not happy with the number of food complaints in your business? Get in touch.