Go overboard to compensate your customers when you make a mistake. This is a business lesson that few entrepreneurs have learned and even fewer have put into practice.
It doesn’t mean simply replacing an item that was damaged or refunding a purchase that didn’t live up to expectations. It means going beyond all of that to compensate them past the point where it would be even remotely fair. Never mind whether it’s profitable to you and your business.
It might seem like bad business in the immediate sense, but doing this not only rectifies the problem situation, but also helps to create customers for life.
In 2006, NPR’s Scott Simon shared an anecdote about customer service that illustrates the importance of this practice. Joshua Steimle of Entrepreneur shares his takeaway from the story:
“His father, upon complaining to his favorite shaving cream company that they weren’t delivering the 90 shaves per can they promised, received a crate full of cans of shaving cream. ‘I think my father may have been buried with the last few cans,’ Simon says. If you unfairly compensate your customer to their benefit, your company’s actions may one day become the stuff of legend.”
In this situation, it wouldn’t be surprising to hear that the shaving cream company simply offered an apology and maybe a small discount for future purchases. But when customers feel that a company has wronged them, this type of small gesture often isn’t enough.
Instead, this company went beyond what was expected of them to apologize to their customer. Keep that customer happy, and most importantly keep them purchasing new items.
Aside from this lesson, Steimle also shared a few more tips for correcting business mistakes. They include: Taking full responsibility for the failure, explaining to customers why the failure will never happen again, and then making sure to actually never do it again.
Shaving Cream Photo via Shutterstock
Divine Rizardo
I am all for going overboard with the customers. After all, they are what keeps the business going. But, one crate of shaving cream? Probably too much! What if some customers who read or heard about this took advantage? It’s easy to claim that you did not get what the product promised. If the company isn’t careful, they might end up with a bunch of “dissatisfied” customers for the wrong reasons.
Nah, I don’t think the crate was too much. I think it was a lovely gesture. To me, it says “we’re prepared to lavish you by way of apology. Your custom is important to us.”
I see where you’re coming from though re: some people possibly taking advantage. I guess if that happens, the company will cross that bridge when they get to it.
Annie Pilon
I do agree that you have to be careful to avoid people taking advantage. But in general, doing something a little extra to keep customers happy when you’ve made a mistake is a good move – it shows that you really care about their business and understand their concern. What exactly constitutes “going the extra mile” is probably different for each business though. Handling these issues on a case by case basis could definitely be the way to go!
As a customer, it would make me appreciate a company if they sincerely apologised. Just saying sorry isn’t enough though. They have to mean it.
If they went that extra mile in terms of an apology, it would make me feel like I really matter to them – not that they have to send me something though, but if they did, the gesture itself is what I’d really value more than what they may actually choose to send.
Hehe! The post title got me – made me chuckle! I’d say a crate of shaving cream was a good way to make up for that particular complaint. 🙂
I also think, as part of an apology, being humble (not defensive) can go a long way.
Annie Pilon
I completely agree, Ebele. Some businesses might not be able to make up for errors by sending out huge crates of their products for free, but a genuine apology and a little something extra can go a long way!
It’s hard to say sorry at times, even if you’re in the wrong. I get that. Companies are made up of individuals after all. But I do admire companies that are able to hold their hands up and say sorry, whether they send something out as a gesture of the error of their ways or not.
Aira Bongco
Unfortunately, small business owners cannot do this without losing money. I guess they don’t have that much extra money as other business owners to work out a better compensation. But I see where this is going. Once you go beyond the expectations, you’ll most likely see repeat customers.
A plain old apology would do. That’s the most important thing, I think. I’d rather receive a heartfelt apology than an empty one with compensation.