Could your best customers be your worst enemies?

Could your best customers be your worst enemies? While in theory this may sound crazy, companies that ignore their best and most strategic customers – particularly in times of crisis or after situations where issues occur – will pay the price. Companies expect loyal customers to behave in the most favorable ways, such as increasing their purchases, recommending products and services to others, and resisting competitive offerings. Loyal customers will in fact do all of these things. But what happens when something goes wrong?   

Today’s environment of online forums and other social media outlets allow for customers to publicly express their opinion, and more often than not the experiences they choose to share are the negative ones. I recently ran across an interesting article authored by Thomas M. Tripp and Yany Grégoire in the MIT Sloan Management Review titled When Unhappy Customers Strike Back on the Internet. Tripp and Grégoire share an interesting matrix on how to deal with the reality of online and public complaints. Click here to read the full article and see the matrix in detail.

The theory behind the research is that there are things that can be done in anticipation of negative publicity, as well as reacting to it. The four quadrants are organized into answering the following questions:

  • Why do customers complain online in the first place?
  • How long will online complainers hold a grudge against the company?
  • How should a company respond after the online complaint? 
  • How can a company prevent online complaining?
It’s the first question – why do customers complain online in the first place – that I found most interesting. Trip and Grégoire suggest there are two primary reasons, and I think they are spot-on. The first is the concept of “double deviation” and the other is betrayal. Looking a bit more in-depth on each of the concepts, I uncovered the following:

  • Double deviation refers to the fact that customers have been victims of not only a product or service failure, but also a series of failed resolution attempts. In my experience, customers will tolerate and even expect some issues. It’s how the resolution is handled that makes or breaks the situation. Continued failure to resolve a customer’s issue not only causes them to lose loyalty, but in time they will almost certainly look for an alternative.

  • Betrayal is a primary driver of what causes customers to complain in an online environment. Not all customers who have issues are going to complain online.  The ones that do feel as though they have so much invested in the relationship that the issues that they are facing with the company are in fact the ultimate betrayal of trust and partnership. It’s basically the “I’ll show you” type of reaction.

So, thinking back to the original point of whether or not your best customers can be your worst enemies. The answer is absolutely YES! Why? Because your top and most strategic customers likely have the most invested and have a much higher expectation of the relationship. If double deviation occurs there is a far greater chance they will feel betrayed and act upon it. Given today’s online environment, this could be detrimental to any company.

Now, not all customers are going to feel “betrayed” and make it their personal mission to publicly make an impression on others. However, it is critical that any company today with highly invested customers have a keen focus on issue resolution and account management. Don’t let your customers become victims of double deviation!


Katie Kiernan
Vice President, Consulting Services


Comments for: Could your best customers be your worst enemies?

Name: Yany Gregoire
Time: Monday, March 7, 2011

Hello Katie:

Thanks for taking the time to read our paper.

You're absolutely right! A strong relationship can "backfire," and customers with a strong relationship feel more betrayed after a double deviation.

We have a few papers about this effect. I invite you to consult my website (under publications): http://expertise.hec.ca/yany_gregoire/

Thanks for a great review!

Yany
Name: Katie Kiernan
Time: Monday, March 7, 2011

Hello Yany,

Thank you very much for the valuable insights! I look forward to reviewing your site in more detail.

Regards,
Katie

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