Killing Them With Freebies: How to Turn A Loud “Ready for a Fight” Customer into Your Biggest Fan

Jun 17 2011

Part of owning a business, retail or online, is learning to deal with unhappy customers. The old adage of “the customer is always right” is a bunch of bull. It should read “figure out who is right and then shower them with free stuff regardless” What I’ve found over the years is there is one simple way to handle a problem. One, talk it out. Two, immediately give them something free.

It really doesn’t matter if it’s online or in person, the customer is going to start off mad. Some show it more than others. In the brick and mortar business you can spot them a mile away. They get out of their car, receipt or paperwork in hand, and head straight for the counter. A beeline to the front door, a little nervous, and rehearsed. Rehearsed for a fight and prepared to get what they want. Some are there to show their wife or husband how much better they are at handling a situation. I can see the conversation at home . “Give me the receipt, I’ll take care of it tomorrow!”

As the owner of the business your first instinct is to worry about losing money on the transaction. You try and figure who was at fault and if you’re not you want to hold your ground. I find it’s even worse on the online transactions because the margins are so small. You say to yourself “I barely made any money on this and now I have to deal with this?”. But you can’t think like this and you certainly don’t want your employees acting this way. Rather than talk down to your customer you need to inform, then reward.

I imagine you are asking why you would reward someone that very well could be completely wrong. First, they are obviously upset or they wouldn’t be complaining. Your job is to make them happy. Although it may feel like you’re never going to make them happy, 95% of the time you can. I find that half of the people that come in are merely uninformed. They expected something that was never supposed to happen. They want a warranty on something that never had a warranty. They don’t want to take any personal responsibility for anything that happened. In these cases we merely explain the situation, how things work, what they may have missed, or the procedures to make things better. Most of the time they are now informed and happy. We then give them something free. In the nursery it may be a coupon for a new plant ON THE NEXT VISIT. Notice “the next visit”. I want them to come again and a free plant will bring them back, most likely buying something else.

The really loud and mad customers take a little more work. I love these types because they convert well to loyal customers. Like taking a bucking bronco and making it into your favorite horse. Loud people and emotional people are most likely loud and emotional in all aspects in their life. I find the people that tell me they will put a sign in their front yard saying how bad our company is will be dismissed by the neighbors because they are always like that. After the first sign the neighbors don’t even notice the next 5. You know these type of people, they always have problems everywhere they go. Because they look for problems. Half the time I feel like they make them just to feel the rush. But they are a piece of cake. Why? Give in immediately

I know immediately if my customer is not going to be happy with any answers I give. With experience you can tell after the initial explanation that they are just there to get some financial recovery. So I give it to them. They come in to fight and I won’t give it to them. “I DEMAND A FULL REFUND IMMEDIATELY!!!!” “Absolutely, Mr. Johnson, would you like a check or put it back on your card? And I say it right off the bat. If I need to refund the customer the entire amount I will. In the case of plants I will replace the tree at no charge. Heck, I even refund their money and still give them a new plant. I won’t turn them all but if I can turn that loud, mad customer into a happy customer they are going to be just as loud when they tell everyone how great we were. How they couldn’t believe how accommodating our business was. And all I lost was a few dollars. I’ll get it back in the long run. The key is to try and not have very many problems so you can afford to shell out the refunds and free swag to those that do have them.

Of course, I produce my own product so I have large margins to play with and don’t incur the cost of say, an electronics store. I imagine there are a lot more people trying to take advantage of you in those cases. If the word goes around that your company is a pushover you’ll soon have customer service lines longer than the checkout. But you can still lean your policy towards the customer. If they bring in a tv and it’s two years old and is broken you’re going to just have to say sorry. But you can offer 20% off a new tv. If it’s only been 15 months you might be able to do more. Yeah, the one year warranty is over but perhaps your company can have an “error account” Bycreating an error account that gives your customer service department a certain amount of discounts or freebies to give away. We don’t want to go over that amount in a month but if a customer service feels it’s time to dish it out they can. Have someone audit the refunds and rewards, calling the customer to see how it went and monitoring the service people to make sure they aren’t giving their friends freebies. If they go through the month with all their customers being happy and didn’t need to use it all, rewards are given, but to the employees. If they don’t use it and there is a high number of unsatisfied customers than it’s a bad thing. I got the idea from my trading days.

My employer used to give us an error account. If I made a mistake I could throw it into a special error account. They would cover it to a certain point. The trade would go into it and another person would either get out of the trade or just let it ride if the amount was small enough. Some times that trade would turn out great, sometimes it would lose money. Either way I was liable but I had a little insurance. We all make mistakes. Companies and their customers both make mistakes and it’s always nice if you can help your customers get out of their problems. It’s worth giving up free stuff, refunding money because a happy customer WILL speak up and bring new customers. If I am paying big money through advertising trying to bring in customers, why wouldn’t I give away things to keep an existing customer. Adam Strong told a great story he heard from a friend that sold cheesecakes. He said he gave away a ton of free cheesecakes to make customers happy. One time he gave a woman more free cheesecakes than she bought. Hundreds of dollars more. And I bet that lady bought more later.

So next time your feel like fighting that customer, stop and give in. I’m not saying do it every time. You have to protect your business. But there are certainly times that you can give more ground than you do. Think of all the stupid things your business spends money on. Aren’t you better off spending that money on a customer? Word of mouth is the most powerful form of advertising you can do, so stuff that mouth with generosity.

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About the author

Outsmarting the Dumb, Outworking the Smart

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  1. Elliot

    Very true and great points, especially with Yelp and other ratings sites. A bad rating can lead to significant customer loss, especially if it was service related.

  2. tom

    I have been a frequent reader the past 5 months. I have never left a comment before but had to on this particular post, frankly because i got so much good info from it. The information you just provided is so valuable. I never even thought of loudmouth customers as a marketing tool, you did a perfect job of explaining and how to deal with the situation. Thanks Shane!

  3. Adam

    Here’s another story for you. I stayed in a rental home in San Diego before Domain Fest. Had a terrible experience. Instead of agreeing to my reasonable terms to refund me some of my money, the home owner decided to argue with me, all over about $1000. He’s already lost me as a repeat customer, that alone is $3000+ loss to him. How much business do you think it’s going to cost him when I post my review on his site ? If he would have made good, he’d have had a customer FOR LIFE.

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