Interview with John Goodman About Strategic Customer Service

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Stop me if you've heard this one before:

A happy customer will tell five people about their experience while an unhappy customer will tell ten people. That statistic has been part of customer service folklore for decades.

But where did it come from?

It originated in a study commissioned by The Coca-Cola Company in 1980 to evaluate the impact of handling complaints lodged with its consumer affairs department. This was one of the first efforts to quantify the impact of good customer service, and the results were eye-opening:

  • Nearly 10 percent of fully satisfied customers bought more Coca-Cola products.

  • Roughly 75 percent of dissatisfied customers purchased fewer Coca-Cola products, including more than 30 percent who stopped buying altogether.

John Goodman, one of the study's authors, recently joined me for a short interview to discuss his new book, the second edition of Strategic Customer Service. This is a must-have resource for any customer service leader who wants to make an impact on their business.

If you’re like me, and you nerd out on customer service data, you’ll love this conversation. We discuss:

  • The impact of customer service on word-of-mouth advertising.

  • Ways that companies can proactively deliver outstanding service.

  • How "customer onboarding" is a pain point in many companies.

  • What service leaders can do to become more comfortable with business metrics.

  • One tip you can implement immediately to improve service.

You can watch the interview here.

I thoroughly enjoyed the book, and reference it several times in my own book, Getting Service Right. You can find Strategic Customer Service on Amazon.

How to Grow Your Small Business with Online Reviews

Small businesses can struggle to get an edge over larger competitors.

They don't have the built-in name recognition of a big brand. Advertising dollars are limited. The latest technology is expensive beyond reach. And many aren't able to compete on price.

But there is one area that the big chains consistently overlook—online review sites like Yelp, OpenTable, and TripAdvisor. These sites can be the great equalizer by allowing small businesses to advertise a superior customer experience at little to no cost. 

And the best part? Most of the big companies don't get it.

I recently partnered with Jess Greene-Pierson, Director of Go To Market at the customer insight software firm, Womply. We facilitated a webinar to answer three key questions:

  1. Which review site do customers depend upon the most?

  2. How can negative reviews help your business?

  3. How can you earn more positive online reviews?

You can watch the webinar to get the full story, or read the highlights below.

Customer giving five stars in an online review.

Which review site do customers depend upon the most?

This data comes from a recent survey I conducted of over 1,000 adults in the United States. You can read the full story or just skim below.

The number one review site, by far, is Google:

Pie chart showing the most popular online review sites.

What makes it so popular is Google is the place to go when people search reviews without realizing they were looking for reviews. You can try this yourself with a little experiment:

  1. Think of a type of business you might need to find (restaurant, dry cleaner, mechanic, or anything else).

  2. Try Googling the type of business. Ex: "pet store"

  3. Notice what comes up after the ads.

Google suggests top-rated businesses with high ratings that it things are near you. The results show the star rating for each business along with a handy map.

A couple of years ago, I needed to find a pet store as I was driving through Tucson, Arizona. Look at what happens when I Google "pet store tucson." 

Google search results from “pet store tucson.”

Notice these are all local businesses. The big chains like Petco and Petsmart don't show up. This is the small business advantage!


How can negative reviews help your business?

Many small business owners live in fear of a negative review.

Customers exaggerate. Some reviews are fake. Negative reviews can feel like a personal attack. And even legitimate complaints stay online long after you've learned from the problem and fixed the issue.

The good news is negative reviews can actually help!

Researchers at Northwestern University discovered the optimum rating on an online review site is 4.2-4.5 stars. That's because 80 percent of customers seek out negative reviews when evaluating a business. They want to see what customers complain about and how the business responded.

During the webinar, Jess shared an example from Seafood Kitchen in Atlantic Beach, Florida. The owner, Nathan Stuart, regularly responds to negative reviews and asks upset customers to give the restaurant another try.

Slide from online review sites webinar.

One customer, Alvin F., changed a two-star Yelp review to four stars as a result of Nathan’s outreach. This is arguably more powerful than a five-star review because it shows a customer was upset (that happens) and the owner made an effort to make things right.

You can’t expect every customer to change their rating, but you can still make a positive impression on other customers by responding professionally and helpfully. It turns out, there's a quirk in psychology that makes other customers more likely to empathize with you if you handle the complaint politely without getting defensive.


How can you get more reviews of your business?

Jess suggested several straightforward dos and don'ts on the webinar:

Slide from online review sites webinar.

Yelp specifically forbids asking customers for reviews, but many major platforms are either silent on the issue or actively encourage it. Google, the most important site for reviews, actually publishes this guide to help you get more!

Take Action

To summarize, your business is more likely to get noticed if:

  • You have an active profile on Google and lots of positive reviews. 

  • A few negative reviews can give your business credibility.

  • Be proactive, but professional, about asking customers to review your business.

If you don't have an active Google My Business listing, you can easily get started with this handy guide from Womply.

You can also watch the webinar replay.

Customer Service is Not Life or Death (Until it Is)

I had just crawled into bed, exhausted after a long day. 

My four-month-old puppy tried to get comfortable in her crate next to me. She was still getting used to her new home and was full of pent-up energy. The torrential rain we'd experienced that day didn't help and she had worn me out.

Plop.

A drop of water landed on my shoulder. I looked up and saw a patch of ceiling above me was soaked through. Dragging myself out of bed, I got a ladder from the garage and climbed into the attic. 

There's not a lot space up there. Certainly not enough to walk around. I had to crawl over duct pipes and under beams to get to the right spot. When I got there, I found water dripping from the roof and pooling in the attic right above my bed.

Water leaking into the attic.

It was a frustrating moment. The roof was just four years old and still under warranty. Two year ago, I had noticed a leak in the same place after an unusually powerful rainstorm. The roofer came out and told me he had fixed it. Apparently not.

I sopped up the water and laid towels in the attic to absorb the continuous dripping. Then I crawled back into bed even more exhausted, after making a note to contact the roofer in the morning.

The next day, I sent an email to the roofer with pictures of the leak. The rain had stopped, so it was no longer an emergency. I figured he would have his hands full with similar requests and might take a day or so to get back to me.

He never did.

Service failures like this are almost never just one thing. It wasn’t just the leak that frustrated me:

  1. A new roof was leaking.

  2. The roofer told me he had fixed the roof, but it wasn’t.

  3. I was exhausted and trying to sleep when I noticed the leak again.

  4. I worried about damage to the ceiling (it turns out, there was).

And now the roofer wasn't returning my message.

I tried calling. A recording said the number was disconnected. I went to the website, but the website no longer existed. I did a web search of the company name and saw it had gone out of business.

Damn. There goes my warranty. This leak was about to become an even bigger problem because I would have to find another roofer and pay for the repair out of pocket. Part of the ceiling would need to be replaced as well, after water soaked through it.

Out of curiosity, I searched the roofer's license on the state licensing board website. Perhaps the license was still active and the roofer had moved or sold the business. Or maybe I could just track the guy down and give him a piece of my mind.

The search result was not what I expected: "This license was canceled on the death of the contractor."

I'm not sure what happened. He wasn't an old man. I imagined his family missed him, deprived of his presence earlier than expected. He had employees, too, and I imagine they all lost their jobs.

Suddenly, my leaky roof wasn't as important.

We all face frustrations as customers. Some of us lose patience and rant and rave as though it's a matter of life or death. It almost always isn't. This experience was a reminder.

I've worked with a couple of clients where service really was a life or death matter. The service they provided literally contributed to saving lives. So I've seen the difference between that and a leaky roof, an undercooked steak, or a flight delay. 

The experience made me reflect on a few things:

  • Customer service is not life or death, unless it really is, so act accordingly.

  • It’s important to treat others with empathy—you never know what they are experiencing.

  • Every job is a part of your legacy, so always do good work.

I'm still not happy. And I'm a bit conflicted between my empathy for the roofer's family, friends, and employees, and the knowledge that his legacy in my mind is a service failure. But I'll try to maintain perspective as the next storm rolls in.