The work of John Goodman and Marc Grainer, two of Customer Care Measurement & Consulting’s principals, led to a customer care revolution in the United States, and for both, an ongoing passion to monitor and continuously optimize the customer experience to create a win-win for buyers and sellers.
Following completion of the ninth wave of the National Customer Rage Study, in June 2020, Vicki Doran had the opportunity to interview John Goodman about his work and the history of customer care in the US.
What follows is Vicki’s interview of John Goodman about his storied career in customer experience, customer care research, and the 2020 National Customer Rage Study.
John, it is my understanding that the research you and Marc conducted for the 1976 White House study on customer care began your lengthy career in this field. Is that true, and, if so, what drew you to the White House work?
Indeed, the White House work was the beginning for me and Marc, and a little later, Scott Broetzmann.
Marc and I met organizing the very first Earth Day at Harvard. Marc went on to secure funding from the American Bar Association’s Foundation and the US Office of Economic Opportunity to conduct client satisfaction surveys for health centers and legal service agencies. This work led to a contract with Elliot Richardson, Secretary of HEW (and then Attorney General) to review consumer advisory boards across the whole government. At the same time, RAND was given a grant for the same work. Their research told people what they wanted to hear, while ours showed that the advisory boards were very ineffective.
Given my engineering background, I became fascinated with figuring a way to quantify the loss to companies by failing to capture complaints and satisfy their customers.
All this led to the White House Office of Consumer Affairs contracting with us to research and pursue improvements in complaint handling and customer care. Our early work led to the creation of customer call centers, 1-800-xxx-xxxx.
Author of three books in this field, you have clearly been able to maintain your passion for creating an exceptional customer experience. What motivates you, and why do you think it so important?
Well, first and perhaps foremost, is that, in the early years, we continued to get contracts following the White House Study.
Initially, we worked with many government agencies, including:
- Highway Traffic Safety;
- Food & Drug Administration;
- Consumer Product Safety Commission, and the
- United States Postal Service.
Then we started working with the private sector. Automobile companies, then contending with the Magnuson-Moss Warranty Act and the emergence of lemon laws, hired TARP, the company Marc and I had started, to establish their 800# based customer complaint handling. General Motors was first, then Toyota and Honda.
But, for me personally, the ability to apply my engineering background to this relatively fuzzy area of consumer expectations and complaint handling has kept me excited about the work and its possibilities. I was applying science to what otherwise had been considered the squishy topics of customer satisfaction and marketing. I loved bringing rigorous management to customer experience and quality and quantifying the impact of efforts and the cost of inaction.
As you know, our decades-long longitudinal study has shown that, while no longer true today, companies used to receive a brand loyalty uplift from just having a complaint handling program, even if it did not lead to customer satisfaction.
Today brand uplift arises only when companies satisfy their customers. Yet, it remains true that it is still cheaper to satisfy the customer than not to. Giving super service pays dividends in both margin and positive word of mouth.
And, some win-win things are so simple for companies to do, like answering its customers’ top five questions right on the home page. And another: empower the front line – give them the information needed to speak with customers intelligently about their problems and the power to solve them.
The research clearly shows this leads to happier employees and happier customers. Customers’ points of pain overlap with employees’ frustrations by up to 70%.
Turning to the latest National Customer Rage Study, what finding most surprised you?
My biggest surprise was the shift in complaint channels from the telephone to email, a web form or chat as well as increase in the overall complaint rate. This means that the multiplier, that is the number of problems in the market for each complaint received, is actually going down. I’m guessing that companies have gotten better at offering digital options, and that customers realize they have a documented exchange by using digital to complain. Also, with most chats answered within a few minutes, speed of answer makes chat attractive. Finally, many consumers dread phone trees, the wait time in the queue, and reaching someone with a heavy accent who may have no cultural frame of reference.
In my view, though, the phone will never be entirely dead. Sometimes we simply need to speak with someone to explain the nuances of the issue we are facing, or to air our frustrations.
In your view, what’s been the most significant shift in Rage Study key findings over the decades?
I think it is that, while it remains true that a high percentage of people don’t complain, the mechanics of complaint handling have shifted drastically, and perhaps also that people want non-monetary remedies as well. Customers want to know why they had the problem, and many want to know it will be remedied so the problem will not recur.
And, I’d be remiss if I didn’t point to how maintaining brand loyalty has shifted. Today, there is a thirty percent increase in brand loyalty if you can get your customers to complain and you satisfy them.
Well, John, where would you say the marketplace has made the most progress in customer care, where has it failed, and what is the most important work that still needs to be done?
Collectively, we have made the most progress in realizing the importance of gathering and resolving complaints. What we have done less well is figure out the best ways to prevent and handle those that occur, and how to justify paying for the investment in customer experience.
The most successful companies are those where service, quality, and customer insights have created an alliance to campaign for both problem prevention and investment in service. At least thirty percent of problems can be prevented by more transparent marketing and clear customer education.
For sure, there are examples of companies doing things well. Off the top, Hilton Tampico Cliffs, PetSmart, Chick-Fil- A, Intuit, and Cisco Systems all come to mind. These are companies that have educated their customers and empowered their front line. They let their employees manage the satisfaction process themselves, which builds confidence, and they don’t criticize.
They are willing to be there for their customers, to do everything reasonable to satisfy them, and to even do some things some might consider unreasonable if it won’t be too disruptive.
Are you optimistic that one day businesses will reap a return on their care investments?
I’d like to see more companies doing the front-end survey work that they need to determine how to improve their programs for a return on investment. I believe that, armed with the data they need and a willingness to implement an action plan that any worthy customer research company can develop, they can reap returns, yes.
If you could give businesses one piece of advice, what would it be?
Aggressively solicit complaints, apply the multiplier to quantify losses from inaction and to provide feedback to management in the form of a quantified revenue business case.
Showing revenue losses which include that lost from non-complainants is far more powerful than simply presenting cost savings information. Fixing complaints and improving products helps grow the topline. All businesses need to keep this in mind.