What is service recovery?
It’s important to understand what is service recovery before we discuss how to improve it. Service recovery is a way for businesses to make their unhappy customers happy again and keep them loyal to their brand. It’s an action that a brand takes in response to certain incidents— customer complaints, product defects, PR disasters, etc.—in order to win back the trust from lapsing customers and retain them for the future.
A lot of times, brands because they don’t prioritize service recovery as part of their customer service. Freshchat as a brand pays a lot of attention to service recovery and we advocate the same for our customers. I decided to document my views for you to learn and appreciate the value of service recovery—a pillar for customer engagement and customer service.
Before I get to the learnings, it’s crucial to understand why it is increasingly important to be good at service recovery.
Hop on a time machine and travel with me approximately 50 years behind.
Welcome to the 70s, with ‘Let it be’ by Beatles playing in the background. There were great inventions—inkjet printers, floppy disks, the most complex format of email, brick-size mobile phones. These were all great products, but that was pretty much it. They didn’t care much about service recovery.
The 70s formed a course of what was called a product-centric market. Good products ruled the market. As a marketer, your job in the 70s was just to create awareness and run branding campaigns like newspaper and radio ads.
Fast forward to 20 years, the market in the 90s shifted to being service-centric. Brands understood that customers wanted more than just products; they wanted to be ‘guided’. Your job as a marketer was to ensure product/market fit and market the solution as a valuable service.
Now, marketers had to start selling what was in it for customers. Gamification, incentives, personalization, and customization started to spring up as new marketing strategies.
Subsequently, we are at an age where all markets are driven by meaningful relationships. Empathy is the last hero standing to save your business.
Today, brands and customers both pay more attention to the quality of the relationship that they share. Engagement and conversations are the building blocks of business relationships.
The relationship-centric economy demands that you prioritize relationships with your customers, or you will fail. Marketing is also evolving to include excellence in service, brand advocacy, personalization, and engagement as its sub-units.
Throughout these market changes, companies that have not been able to keep up with changing patterns have failed BIG. And what’s the one thing that’s needed to survive in this age? Let’s understand that with some examples.
You must have heard about the Tylenol poisoning incident of 1982. An unknown person or group went around supermarkets in the Chicago area and laced bottled Tylenol pills with cyanide. As a result, seven people died in a span of a week and the parent company Johnson and Johnson’s share prices dipped by 17.24% during that time.
But thanks to the foresight of James Burke, the company chairman, Tylenol was not only able to save more people from dying but also saved the brand from being lost in obscurity. First, the company recalled all of their products off of the shelves across the U.S. Then they launched a massive campaign to educate people about the dangers of bottle tampering, cyanide poisoning, and created a toll-free crisis hotline to respond to customers’ queries and concerns.
This is the opposite example of how bad service recovery can kill your business for good. Tylenol, unlike Enron’s reaction to 1989 oil spill fiasco and Jack In The Box’s poor handling of 1993 E. coli outbreak), did a good job of turning the momentary hate they got from their customers into admiration.
If we take a step back and look at the actual process of engagement, it starts and ends with the most important, yet the hardest, thing known to businesses: service recovery, that helps you create close proximity with the customers. How can you possibly retain customers without having a service recovery plan?
Now that we’ve established that service recovery is pivotal, let me share this noteworthy four-wheel strategy which is sort of like a game plan for service recovery. If you apply this four-wheel strategy, I assure that you will see remarkable improvements in your business just by taking one small pledge — planning your service recovery.
Four-wheel strategy to improve service recovery
The four-wheel strategy is a pretty straightforward plan to improve your service recovery and it aligns with your marketing funnel. Here it goes:
Pay attention to the signals
People know what they want, and they’re communicating this through a wide range of signals—from views to searches to clicks to shares.
Use social listenings tools such as BuzzSumo or Mention to monitor what customers are saying about your brand. This will help you jump to action in case customers are raging angrily about you in Twitter, Facebook, or elsewhere. Similarly, it will also help you engage more deeply with customers who are all-praises about a recent interaction with one of your teams or your product.
You can take your customers’ complaints as a form of feedback to improve your processes while engaging with them to improve your service recovery process. Alternatively, you can highlight the instances of positive customer feedback as a marketing opportunity to spread good word about your brand.
Here is how one customer, Desi Perkins, called out the online apparel store ASOS for something she felt unhappy about:
— Desi Perkins (@DesiPerkins) January 20, 2017
ASOS jumped to help although it didn’t have the jacket in stock. Monitoring all social mentions can be difficult if you rely solely on Facebook or Twitter notifications. It helps you portray as a brand that cares and is attuned to customers’ need even if they don’t have a solution to their problems right away. And sometimes, that makes all the difference.
Oh no Desi 💔 We can't say for sure when they'll come back, but keep checking here just in case! 👉 https://t.co/4sVJSwXHkL
— ASOS Here to Help (@ASOS_HeretoHelp) January 20, 2017
Social listening tools give you the big picture behind all the noise that happens in the social media network. Understanding the patterns of your customer feedback will also help you to devise a social media marketing plan that will elevate your brand’s reputation among prospects and existing customers.
Social listening tools help you to monitor and engage with all social media mentions from a unified platform. You can use the tool to either act with urgency on pressing matters, reply to console a raging customer or assign the message to the right team for specific assistance.
People expect brands to know what they want and assist them in getting it. And the brands that evolve their strategies around consumer intent will win.
– Jason Spero VP, Global Performance Solutions at Google
Device a service recovery plan for emergency
A crisis can be an opportunity in disguise, as exemplified by brands like Tylenol. But you can’t always expect to come up with the best response to crisis if you don’t invest your time to plan for it. It’s equally important to have a crisis management plan for your brand in case you have to fight deadly fires or the wrath of angry customers.
A service recovery plan is not only useful to restoring the bad service or experience but also to restore customer’s trust in your brand. You can weather the worst of storms if you have a preemptive service recovery plan that aims to mitigate the damagee to your brand reputation. Without a plan, it can prove to be an expensive and unreliable exercise for your brand to stand back on its feet.
Jack In the Box’s recovery plan is a classic example. After the death of four children and 178 people diagnosed with various cases of brain and kidney damage, Jack In The Box had a lot to lose. But it apologized to its customers and doled millions of dollars in settling lawsuits—it dragged its parent company Foodmaker almost to the heels of bankruptcy. But it was the best thing to do for the longevity of their brand. It was also the right response to the loss of human lives.
Secondly, it pulled back its TV commercials with an aim to pacify the rage people had for the brand at that moment. Instead, they launched a publicity campaign to douse the fire that was burning widely in the hearts of not only the 732 victims, but their families as well as others enraged by the incident. Jack In The Box also hired the best food-safety experts in the country to change the way they procure, process, and store their food. They adopted such a high standards for their food-safety after the incident that it remains the most stringent in the American food industry.
With other fail-safe marketing strategies such as rebranding themselves as safer food chain and aggresive TV ads, Jack In The Box was able to overwrite the public perception against the brand and reinvented itself as a trustworthy restaurant chain.
Put yourself in your customers’ shoes
At Freshchat, we constantly make it a practice to place ourselves in our customers’ shoes to empathize better and offer relevant services. This is one of the main reasons why we started paying more attention to self-service features and chatbot integrations as we understood that more and more customers wanted to find answers to their queries on their own without having human intervention.
In the 1980s and 1990s, Lego had replaced its veteran designers with a younger crew who decided to innovate without respecting what the customers wanted. The number of unique Lego parts went up from 6,000 to 12,000, the designs became more complex. However, their sales plummeted. In 2003, Lego lost $300 million—even though Lego had the highest profit margin over any toy brand—and predicted a loss of $400 million in 2004. Lego failed to respect their customers’ views at that point.
Finally, when Lego asked its customers what they wanted, they realized that their customers wanted to just build from simple blocks. At that point, Lego’s direction had shifted away from building and creativity, but that was what people had loved about it in the first place. They decided to listen and give customers what they wanted. In 2010, Lego was profitable with sales of $2.3 billion, and in 2015 sales went up to $5.2 billion.
As a marketer, you should frame this story in your mind. It’s imperative to empathize with your customers before making any big pivot. Inform your customers of all the expected changes in their interface, ask them if they are comfortable with it, provide enough assistance to late-bloomers with tools that cater to these experiences.
New York’s fashion brand, Kate Spade recently made a shift from conversational marketing to empathetic marketing. They were struggling to be understood by their customers. As a solution to that, they resorted to actively listening to what their customers truly cared about and decided to be truly empathetic.
We’ve been on a journey toward empathetic marketing to make sure we’re listening to our customers and responding to their needs rather than just talking at them.
– Mary Beech, EVP & CMO, Kate Spade New York
They asked the customers what they wanted, placed themselves in the customers’ shoes to weigh out the possibilities and formulated their content strategy around what their customers wanted. Kate Spade incorporated this in their YouTube content and saw a tremendous increase in engagement.
The most important reason why you need to be empathetic and place yourselves in your customer’s shoes is to avoid stereotypes and get closer to your customer. Most cases we might assume something purely based on the data that we analyzed. Sometimes it takes more than that. It takes care. Use data analysis to identify behaviors and segment your target audience. But true service recovery lies in being empathetic. Ask your customers, and respect their opinions.
Feed off the feedback
In 1992, Kodak Eastman’s revenue was $20 billion, but as digital cameras gained popularity, they refused to respond and tried to protect their film and film processing business. As companies such as Sony and Fuji started selling more digital cameras, Kodak started receiving feedback from its customers asking for digital solutions. However, Kodak resisted the consumer feedback and demand, and by 2010 they were only in sixth place in the digital camera market, In 2011, Kodak Eastman filed for bankruptcy, with their share price at 65c, dropping from $94 in 1997.
I cannot stress the importance of paying attention to customer feedback. This is the only straightforward way for marketers and business owners to gather insights from people who have been using their products. Ignoring feedback might cause irreversible damage to your brand image and brand performance.
Listening to feedback is an art in itself. You need to be able to map context to your feedback first, whether it is an appreciation or an opportunity for improvement. Whether the tone is negative or positive. Note that there is no bad feedback. Every feedback provides us a direction to improve and work towards.
Next step is to categorize your feedback based on the intent. It’s important to decode different parts of your feedback to understand the issue that has been conveyed. Let’s look at an example and decode the feedback together.
Customer feedback: “ I tried to set up the widget on the top corner of the screen. But couldn’t do it. Is there a workaround?” Decode this feedback into four parts.
- Part 1 – I tried to – User is trying to do something that’s not already available as an experience to simulate. Might be a user experience issue.
- Part 2 – Widget – The feature that the user is having a problem with.
- Part 3 – Couldn’t do this – Shows sentiment. The user might not be happy.
- Part 4 – Workaround – User is looking for a solution, not just reporting a problem.
Parts 2, 3, and 4 help you with immediate resolution. Part 1, which is usually the first part of the feedback is a note that you make for future references. If you have more users sending in queries with the same first part, it’s a sign that you need to work on your user experience.
Let’s look at another example.
Customer feedback: “How are you different than XYZ product. I’ve been trailing their product as well. Want to understand the difference.”
This feedback has 3 distinct parts that I would look at.
- Part 1: How are you different- Shows that the issue is with product marketing. Not enough awareness
- Part 2: XYZ – Competitor
- Part 3: Understand the difference – Asking for information
Part 2 and 3 shows that the customer is comparing you with your competitor to understand the differences in value that you are offering. This should be bucketed as a query. Part 1 shows a lack of information in terms of creating awareness. This would be a useful asset to have for a customer who is migrating from a different product.
In terms of addressing this feedback, I would immediately send out an email or chat with the customer listing down our unique value prepositions and how different we are from XYZ. As a long-term solution to address similar feedback in the future, I would put up a comparison deck on the website listing differences and why they should consider our brand as compared to our competitors brand.
With respect to feedback, it’s important to understand that you won’t be given feedback till you ask. Ensure that you probe the users at different junctures of their user journey to realize their views of your product and understand if they are having a good experience. As Stephen Covey mentions in his book 7 Habits of Highly Effective People:
It takes humility to seek feedback. it takes wisdom to understand it, analyze it, and appropriately act on it.
– Stephen Covey
Service recovery is the number one catalyst that aids you in building great relationships with your customers. You always start by listening to what your customers want, what problem they want you to solve, what your competitors’ customers are saying about that brand, and finally listen and decode what customers are saying about you in terms of feedback and testimonials.
Listening is not understanding the words of the question asked, listening is understanding why the question was asked in the first place.
– Simon Sinek
Using the four-wheel strategy, try to become a better listener and therefore become a better brand eventually. And truth to be told, prioritizing on our service recovery did make us a better brand, a more responsible one. That’s the only way you can achieve the true essence of customer engagement.
Pledge to think beyond conversations—pledge to listen!