Make things right with customers or you'll be left

A colleague of mine recently shared a negative experience he had with a large Canadian airline.

He had purchased a ticket to return home last year for the Christmas holiday but was unable to do so because of medical reasons. It was his understanding that the value of the ticket would be honored for one year from the scheduled date of travel.

However, the airline's policy was actually to credit the value of the ticket for one year from the purchase date. This information wasn't printed on his ticket and when he contacted the airline, he spoke with four members of its customer service department, including a senior manager, and received four different explanations of the airline's policy and his possible remedies.

During a time following the horrific events of September 2001, my colleague thought this airline, now more than ever (especially after requesting government relief due to lost revenue), would bend over backward to satisfy him and keep him as a regular customer. Airlines were slashing fares as much as 50 percent so as to entice fearful passengers to once again take to the skies. He was utterly shocked and appalled, however, when he experienced the lengths to which this airline went in the opposite direction.

Each of the four representatives gave four greatly varied definitions of the airline's refund and rescheduling policy. Each apologized for his inconvenience yet repeatedly told him what they could not - and would not - do for him.

In the short term, the immediate savings by the airline was $400, the value of the unused ticket. The net loss over the long term, however, will be much, much greater. Not only will he and his family never use this airline (they spend about $3,000 annually), they are so furious that they've told many friends about this experience. Not surprisingly, everyone they've told has been shocked and appalled, also, saying they, too, will never fly with this carrier in the future.

Understanding that the customer is the source of a company's revenue, it logically follows that every customer must be made as happy as possible, especially so during an industrywide crisis of historic magnitude. Seeing as it's not the owner of a company that routinely interacts with customers, but rather the sales staff, operators, customer service reps, etc., that have direct contact - it must be a clearly understood rule that the customer must always feel right.

The customer has to be treated in a way that sets a company apart from competitors. If a company successfully merges this philosophy with a superior product or service, it can earn customer loyalty and in turn, become profitable. Case in point: Nordstrom.

A Nordstrom customer's experience provides a perfect counter to the aforementioned airline's woeful customer service practices. For years, the story has circulated about a man who had returned tires to a Nordstrom store and it provides an excellent example of how to exercise a customer-first approach to business.

The story is true: Nordstrom built a store in Alaska at a location that had previously included a tire store. A man, failing to realize the tire store no longer existed, brought car tires into Nordstrom and asked for a refund. Despite the company's position as a clothier (seemingly everyone knows the only rubber Nordstrom's sells is on the bottom of sneakers), the sales associate nonetheless issued some type of refund or store credit, thus satisfying the customer. When people talk about this story, many can't remember if it was a man or a woman, a young or old person, but they always remember that it was Nordstrom who put its customer first.

Although this example is extreme, and I don't suggest that a company make a habit of issuing refunds for merchandise it doesn't sell, the underlying principle stands: For long-term prosperity and patron loyalty, a customer must always feel right, even when she's wrong.

Even if a company such as the airline in question doesn't want to adhere to this same level of customer service, or more likely, doesn't believe it can afford to, the only question I would ask its top brass is, "Can you afford not to?" Word of mouth is by far the single most important marketing vehicle a company can hope for. And think of what the word of mouth may do for this airline's long-term outlook.

Not only has the airline lost loyal customers and likely many more once this story spreads. But more importantly, the employees who initially offered the incorrect information to a loyal customer and then blamed the customer himself for acting on the information he received, are still employed. How much more inaccurate information are these employees going to disperse and what will be the resulting net loss?

Follow Nordstrom's lead, not the woeful path cut by the airline. Before the next customer crisis arises at your company, I urge you to ask yourself the following questions so you are prepared to handle the situation appropriately: How does your company resolve customer disputes, concerns, questions or problems? Do your people automatically go on the defensive, citing policies, procedures and counting warranty periods to the day? Is there a mission statement or customer policy in place that governs all aspects of customer service, including conflict resolution?

You can't put the onus on your customers to get it right every time. Too many companies focus on the reasons why they can't help a customer, rather than offering solutions to help fix his problem. The reality is, problems will arise. The problems are not the challenge. The challenge is responding to these problems effectively for these responses help determine a company's ultimate success or failure.



Roy Chitwood is an author, trainer and consultant in sales and sales management and is president of Max Sacks International, Seattle.