The gift of a poor vendor

Businesswoman with frown signAmidst the seminars, webinars and in-house training available to teach your employees best practices for building and maintaining outstanding client relationships, a sometimes forgotten source of training exists that may be your best. It is a type of training that we all experience, but may not look at as training. The training to which I am referring is the manner in which you are treated by your vendors. After all, you can feel your own emotional response and your appreciation of your vendor or lack thereof. That’s not theoretical – it’s real. Think of it as a gift.

It’s been said that if you like a vendor, store, etc., you may not say much, but if you dislike them you’ll tell 9 to 15 people. Here’s the lesson I recently was given by my least favorite company ever and my telling it to you and others. Can you relate?

This is a software company. The complexity of their product requires service. And given the role this service plays within Evergreen Trading, there is often urgency associated with that service.

A little more that a year ago, they changed their technical support policy. Instead of calling and waiting in a queue for a live support person, you now wait in queue for someone to take down your information so a technical support person will call you within 48 hours. Early on when I played this game, my wait was usually right at that 48 hours. The reason I stopped calling was that I would typically solve my own problem well before that 48 hours, so I no longer use their support. (Their secret plan all along?)

We receive a certain amount of credits each month that are applied for using their service. The amount automatically renews the first of every month. We ran out early and I called my service rep to buy a small amount to hold me over for the last few days if the month. I expressed to him the urgency of having these credits over the next few days. He said he’d get them to me that day. Two reminder phone calls and three days later, I had received nothing but an apology for not being able to do this simple thing called selling me more credits. It was the first of the month again, and my need to buy more was moot. Of course the credits eventually came and I was billed in full.

I received my annual renewal notification yesterday. You would think it came from the IRS. “Reply to this email: ‘Renew as is’, so we stop sending notifications.”, “Changes to your contract must be made at least 30 days before it renews. Any requests for changes after that will not be honored.”,  “If you do not contact me by [a certain date],  your contract will automatically renew on…”

Notice the pattern? “so we stop”, “will not be honored”, “If you do not”. It would have be easy to use positive phrases like “so we can”, [do this] “so we can honor”, and “when you…”.

It all falls into a pattern. Treat service as an expense and make it as painless as possible for you as the vendor rather than as an opportunity to build your client relationships – and make it as painless as possible for YOUR CLIENTS. Charge your clients in full for something on which you missed their deadline and need. Fill your renewal notifications with demands and penalties for NOT doing what you as the vendor want – rather than making it pleasant and easy for your client to give you their money – and filling your requests for their renewal with rewards.

Here are a few of useful stats on customer experience from a terrific post on the Return On Behavior blog:

  • 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
  • 70% of buying experiences are based on how the customer feels they are being treated – McKinsey
  • Price is not the main reason for customer churn, it is actually due to the  overall poor quality of customer service – Accenture global customer satisfaction report
  • It takes 12 positive experiences to make up for one unresolved negative experience –“Understanding Customers” by Ruby Newell-Legner
  • An average company loses between 10 – 30% of its customers annually – McKinsey
  • A customer is 4 times more likely to defect to a competitor if the problem is service related than price or product related – Bain & Company
  • Dissatisfied customers whose complaints are taken care of are more likely to remain loyal, and even become advocates, as those that are ‘just’ customers – Strauss & Seidel
  • A 2% increase in customer retention has the same effect as decreasing costs by 10% – Leading on the Edge of Chaos, Emmet Murphy & Mark Murphy

About Mike Lake

Mike is the Senior Vice President of Marketing for Evergreen Trading. When not playing jazz trombone he is probably obsessing about writing content that will capture the attention and interest of business people and fellow learning junkies everywhere.

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