Complaint effect

Retailers should try to find ways of getting customers to communicate their complaints to management - not just because of the inherent value of such feedback, but also because of the dangers of complaints being reported to shoppers' social networks.

by Knowledge@Wharton, March 8-21
Last Updated: 23 Jul 2013

Gripes tend to get embellished when they are told to friends, family and work colleagues, making the effect even worse. Nearly half of 1,200 US shoppers surveyed said they avoided a store because of someone else's negative report.

Overall, for every 100 shoppers who have a bad experience, a retailer stands to lose up to 36 current or potential customers, according to the study. Only 6% of surveyed shoppers bothered to complain to the company, but nearly a third shared their complaint with others. Making it easier to complain in-store may defuse the network effect.

Source: Beware of dissatisfied customers: they like to blab
Knowledge@Wharton, March 8-21

Review by Steve Lodge

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