How do you communicate bad news to your clients?

In every business, there are times when things take a different turn and projects can often head south, may it be due to human error, unforeseen circumstances, or uncontrollable situations. When things go awry, how do you break the bad news to your clients?

“Bad news is never good to deliver, but developing a process over time has made it easier to handle.”

- Steve Jackson

There are different approaches to it, depending on your client’s characteristics and your relationship with them. A few entrepreneurs share with us their experience and how they tackle the problem when the situation calls for it.

However, all of them have one common word – HONESTY.

Truly, there’s no better way than to be upfront about things, especially in business. It saves all parties time, resources, and effort when things are talked out promptly and issues are tackled head on.

Austin Vaughan, Managing Director at Pacific Solar, confirms this. “I would commonly take a direct approach as we feel honesty applies in all our communications,” he said.

Nyree Hibberd, CEO of Koh Living, expounds on this further. “Honestly, as it’s one of our 5 brand values: “We are honest, authentic, and down-to-earth; ‘keep it real’ is our number one mantra. We tell the truth and strive to always do what we say we’re going to do.”  For us, bad news may be around stocks selling out or delays in arrivals of replenishment. So at every stage, we aim to keep the customer informed with accurate information to limit the interruption to their business.  In most cases, we find it’s about the communication of the news rather than the news itself, so we aim to always be upfront and honest with any bad news,” she remarked.

While unfavourable news cannot be avoided, it often depends on how the information is delivered. But having a method or careful approach can help mitigate the negative impact it may bring to the client or business. However, it doesn’t stop with just telling the client about the problem. Coming up with alternatives at the onset can also help ease the worries of the client.

Steve Jackson, Director at PurpleMonky and Founder of Moon & Back Co., shared, “Bad news is never good to deliver, but developing a process over time has made it easier to handle. Firstly, an urgent team meeting internally to discuss what happened, and what solutions are available. Then, we make an immediate phone call with complete honesty to the client about what happened and how we want to work together to find the best solution. No matter the outcome, the client always respects the honesty & willingness to find the solution.”

In short, crisp words, Dion Castle, CEO of Struber, stated it simply but powerfully, “Communicate quickly, clearly, honestly with a solution ready.”

This is echoed by Joanne Camilleri, General Manager of Telco Business Solutions Group, “With complete honesty, authenticity and ensuring, if necessary, that we are taking ownership.  Ideally, we communicate face to face.  If appropriate, we would finish it off with the challenge or opportunity that is arising from the bad news.”

A more detailed explanation is provided by Ben Stickland, Founder and CEO of Alliance Software, “We do it with brutal honestly and as quickly as possible. The formula is simple: we tell clients this is what happened, this is how it'll affect you and this is what we're doing to fix it. We also always tell clients that right now, we're focused on the fix and when the dust settles, we'll do a review and work out how we avoid these problems in the future and make it right. In our space, clients are very understanding if you're upfront and drop everything to make things right.”

Have you experienced a similar situation where you have to break some bad news to your clients or customers? How do you do it? Share with us your approach and its effect on your business.

Dealing with angry customers in your business

At some point in your business, you might encounter unhappy clients or customers. It could be that a fault in your product or service was found, a mix-up took place or an unexpected misfortune occurred. Whether the concern was caused by internal or external factors, businesses have the responsibility to look into the complaint and even appease the customer.

Sometimes, the client may also be going through a rough patch and emotions may run high. You and your team must not take things personally and deal with the matter at hand with fairness and an open mind. Below are tips on the actions you can take when dealing with irate customers.

Understand the problem and the customer

In an emotionally-charged situation, it is important to keep everyone calm, especially the customer. First, listen attentively to the complaint and understand the problem. Allow the client to state what the concern is and repeat them to clarify. Ask questions to have a better picture of the scenario. Adjust your mindset and try to look at things from the perspective of the customer so you can sympathise with them. Remember that the consumer may be exasperated or frustrated, so make sure that you ease their minds and let them know that you’re there to help them.

Respond politely and explain thoroughly

No matter how angry a customer is, be polite as much as possible, unless the patron goes beyond the line. Be sincere in your response and state your explanations with composure. While you may have a customer service or staff receiving the complaint or attending to the customer, it may sometimes be helpful to have a manager step in. Be conscious of situations where the business owner has to interfere as it may bring positive results, but may also make matters worse.

Acknowledge any mistake and apologise humbly

Whether it was an unintentional error or a misunderstanding from the part of the customer, offer an apology for the stress the situation may have caused. If a mistake was done from anyone in the company, acknowledge it humbly.

Offer solutions and compensate, if needed

The best way to respond to a complaint is to offer solutions if there are any problem presented. If it’s a damaged product, you might want to send a replacement. There are incidents where a ready solution is in place while there are those where you probably need to discuss internally how to mend an issue or solve the problem. Be ready to compensate, if necessary. Even if it’s not needed, do an act of goodwill by sending over free goods or special benefits to the consumer as a way of making up for the anxiety that may have been experienced due to the situation.

Follow-up and update the customer

If it takes time to resolve the problem, make sure to update the customer of the status of the complaint. Follow-up with the customer if you have brought satisfaction with the way you dealt with the problem. It may even be even helpful to let the customer know if you have instituted changes or improvement within your business that was a result, directly or indirectly, of the circumstance.

In business, one is bound to commit mistakes and misunderstandings are unavoidable. Nevertheless, whenever you encounter disgruntled customers, treat every complaint as important. One tiny error can ruin a lifetime of hardwork. Don’t be afraid to face an angry client. It is better to resolve issues as early as possible, seek ways to mitigate it and review how it can be prevented in the future.

The impact of user reviews on businesses

Consumers nowadays have the power to sway market opinion. Through review sites and social media networks, customers can make public their experiences with businesses they utilised. User reviews influence buying decisions because the market now looks into the assessment of those who have already availed of particular products or services before committing to a transaction. Thus, client ratings and testimonials provide customers with both a resource and a voice that can affect one’s company or brand.

The rise of online shopping and e-commerce sites, social media pages, rating forums, booking sites and blogs have allowed patrons to consolidate their opinions and evaluation of a service or product in platforms that can be viewed by the public. With more and more sectors bringing their businesses in the cyberspace, customer reviews are no longer confined in the food and hospitality industry. It also extends in fashion and beauty, internet, retail and other service providers. Popular online personalities exude certain authority when it comes to setting trends and directing the flow of public opinion.

Given the shift in the mindset of buyers, how can user reviews impact your business and how can you use it to your advantage? Rankings and recommendations can become a marketing tool to promote your venture and, at the same time, strengthen the customer service and client relations aspect of your business.

The effects of customer reviews on a brand

It can boost or lower sales. One apparent and immediate effect of customer reviews is reflected in the sales performance of the product or service in question. Several negative comments may lower the sales of your business while, on the other hand, good reviews can boost profits as they drive more sales. When users are contented with the service, there’s a tendency for them to buy more or avail of additional services. The trend may vary from day to day, so make sure that you consistently have positive feedback from your customers.

It can build or damage your brand image. For a company, big or small, image is everything. If bad reviews keep pouring in, people will believe that you offer poor products of services, which may be difficult to reverse. It can cause a huge dent on your image because your existing and prospective clients may lose their trust in you. However, if you get good ratings steadily, the general public will regard you as a dependable company. It will build your stature in the industry that even a single minor unfavourable remark may not cause too much ruckus to your enterprise.

It can attract or drive out customers. Another impact of customer reviews is that they can either draw new customers to you or deter them from patronising you, let alone consider you as among their choices. Existing clients that are satisfied can become your regulars and brand ambassadors. They become your mouthpiece to others, so an endorsement or criticism can create a ripple effect on your future clientele.

The things you should do to bring it to your advantage

Knowing that customer reviews may have a lasting consequence in your business, here are some of the various actions you can take to make sure you turn every review to your advantage.

Always improve your product or services. Consider every feedback as a way to develop your products and services and enhance your business. If you always aim at providing the best quality and highest standards you will have satisfied customers. A user review can only become compelling if it rings true. Treat each customer like a VIP, making sure you provide them with good value for their money and that you attend to their needs.

Monitor online to gather feedback and reviews. Constantly check your corporate website, social media accounts, blogs and booking or e-commerce sites where you have signed up, blogs. Set alerts in your search engines to notify you when there is a new post or article about your business. It helps when you pay attention to comments and let your customers know that you heard them.

Respond to negative feedback right away. Don’t be afraid of receiving a negative review. Some fear it so much that they delete it from their sites. But the public will know and it will only cause more irritation from complainants. Avoid being defensive in your answers. It’s even worse if you go on the offensive. The best approach is to respond to the adverse feedback right away. Clear any misunderstanding if there is one. An apology may often be needed. It is also a way for you to show others that you are doing something to address the concern and that you are continually improving your products or services. When the public sees that you care for each client, they are more likely to trust you rather than just putting out only the positive marks you got. 

Encourage satisfied customers to leave feedback. Irate customers are more likely to leave a review than those who do not have complaints because the former is charged with so much energy driven by anger that they will go out of their way to share their experience. Make sure you encourage satisfied clients to write their positive reviews. Some review sites may dissuade businesses to provide an incentive for favourable comments, so the best you can do is to remind them to write about their fulfilling experience for the benefit of other customers.

In the end, it all boils down to having good relations. It encompasses relationships with your staff, your sales team frontliners, suppliers, and clientele. Establish and maintain open communications with them and build on that. If you have enough resources available, be sure to have a dedicated person or department that will take care of customer relations. It pays when you tune your ears close to what your consumers have to say. In the end, it is up to you to take action or not. However, customer reviews can also aid you in coming up with informed decisions based on what is best for your company and the customers.

Tips for effective customer service

Businesses acknowledge the fact that retaining existing customers is more cost-efficient than seeking new clientele constantly. Consumers may extend their loyalty to a brand if they feel valued by the company and receive the ample attention they need. The danger lies when you commit and does nothing to salvage the damage done because customers can easily shift to another brand.

Nowadays, the public can quickly access the information they need through modern technology, which means they are more knowledgeable. The staggering options available can take their interest away from your brand. To counter this, investing in good customer service will help your company establish a strong support channel. If you truly subscribe to the adage that “the customer comes first,” then it is but apt to put your money’s worth on what you deem as the most important in your business.

Create a strong customer service team

The first thing to set up is a formidable customer service team that can quickly address various client concerns in any given situation. Hire competent people and train them well so that they can respond to customer needs and queries in a fast and amicable manner. Treat your employees well and keep them happy so that their positivity can radiate to the clientele they deal with, whether on social media, over the phone, via e-mail or through the face-to-face encounter.

Engage with them during and after-sales

When dealing with clients before and during sales, make sure that they get the best experience there is that they will find the transaction memorable. Take time to reach out to them after sales, to see how they are finding the product or service or to greet them during special occasions. Customers appreciate it when you keep them in mind. If there are foreseeable problems, it is better to take a proactive stance and inform them in advance instead of waiting for them to complain.

Gather their profile and contact information

Don’t lose your client’s contact details and viable information. Have a secure database where you store their data, including the kind of product or service they availed from your business. Keeping a record of these details can help you see the preferences and transaction histories of your clientele. It also enables you to customise and personalise your communication with them according to the information stored. Be sure, however, to always update your database regularly.

Use multi-channels to reach out to customers

Know where your customers are and make your brand accessible on various channels. Often, one source of frustration for consumers is not knowing how to get in touch with a particular business. Present and target customers must be able to find you online and offline. When you communicate with your clients, utilise different platforms to make sure that you have sent your message across and is well-received by them.

Emphasise on speed and quality

Be agile in attending to the needs of your clients. Speed is one thing that they will find admirable in a company. Pair this with quality service, where you provide the best attention and address every situation with utmost care.

Go the extra mile

Kind gestures, big or small, can warm someone else’s heart. Take consideration for those who need extra care, such as the elderly. Be patient when dealing with irate customers. Don’t overpromise, but overdeliver. Always wear a smile. Don’t just go after the sales, rather, go after the relationship. Moreover, do things more than is expected of you.

Customer service is a role that must not be confined within only one department of your company. Every person in your organisation should breathe and live good customer relations. Everyone must take part in ensuring that clients have a positive experience with your brand so that they will continue to patronise your business and even draw others to your fold.

The similarities between dating and customer relations

Others may think that business is a cold-hearted transaction devoid of any emotion. But what they fail to see is that companies that thrive and succeed are those that place a high value on their relationships with their stakeholders, such as their patrons and consumers.

Whether it’s a retail business or a B2B company, good rapport with the customer or client is necessary to keep things going. Several studies point out that the cost of acquiring a new customer is higher compared to retaining existing ones. To capture your client’s interest and secure their loyalty, you have to put your focus on understanding them, their wants and needs. It’s like courting someone you like and make that person fall in love with you. We can probably use a few ideas from dating and apply them to customer relations.

Attracting their attention

When you set your eyes on someone you want to woo, you will do certain things to gain their attention. You send flowers, write romantic messages, dress up or make your presence known to that person. In marketing, you need to be out there. You come up with advertisements, utilise social media, beautify your store, polish your website or create a beautiful packaging and catchy taglines. Sometimes you have to customise your approach depending on the response of a particular client or consumer. Before you plan out your strategies, you have to find out what ticks and clicks to your prospective customers by conducting research that can provide insight into their preferences.

Getting them excited

If obtaining the attention is the first hurdle, the next one is to get the person interested. You have to excite them to get a second, third or more dates. It’s the same thing with customers. The first engagement with them should be memorable, but you have to come up with other means to make them come back for more. It’s either you sign them up for a rewards system, offer a discount on their next transaction or highlight your unique value proposition to gain their trust and confidence to your brand. Make them look forward to recurring encounters with you.

Communicating good news and issues

One of the reasons why relationships fail is that both partners do not communicate properly. As you get to know each other more, you have to express your appreciation of the person or discuss issues in the onset. Similarly, customers are pleased when brands inform them of milestones, good news and possible concerns ahead of time. Whether you do email blasts, social media posts or community forums, constant communication with your customers will make them feel valued, especially if you listen to their suggestions and get their feedback.

Resolving problems

No relationship is perfect. There will always be misunderstandings and disappointments. But you have to work hard to go beyond that bump if you truly want lasting relations with the person you love. If there is a problem, you can nip it in the bud before it blows out of proportion by finding a resolution. When it comes to business, make sure to resolve any problem that your customer may encounter with your product or service. You can go the extra mile in assisting your clients, particularly your loyal patrons so that they will keep coming back regardless of the hiccups.

Elevating the relationship

A relationship is like a journey. You either move forward or go backwards. Despite the ups and downs, you have to put more effort to strengthen the bond. Customers of companies that show strong rapport with their clientele often turn out as ambassadors and help attract new patrons. You have to come up with ways to elevate the affiliation of your loyal clients to your company so that you grow together in this journey. This is one reason why some brands build online communities to involve their consumers to their brand.

The question now is this: Is your relationship with your customers only for now or is it for keeps? Whether it will lead to an enduring and deeper correlation or something temporary, you alone can give the answer to this. It all depends on your actions. If you know your customers better, you will know the right path to forge ahead.