Customer complaints: The complete guide

Customer complaints are an unavoidable aspect of running a business. No matter how good or bad your services are, you will still receive complaints about 1 aspect of what you do at some stage. Complaints can be frustrating to deal with and may even feel daunting to deal with, however, dealing with them in the right manner will foster loyal relationships with your customers and establish your operation as a trustworthy brand. 

You need to know what to do when receiving complaints, how to find a viable solution, and how to ensure your customer is happy with the outcome in order to be competitive in today's market.  Remember a loyal customer is an invaluable asset, while an unhappy customer can cause huge reputational harm to your business.

What are customer complaints?

Customer complaints are issues raised by consumers regarding the goods or services they have purchased from your organization. Customer complaints are common across sectors, and knowing how to handle them is crucial when selling goods and services. Incorrect handling of customer feedback and complaints can drive your clientele directly into the arms of your competitors, as they will look for alternative solutions for their needs if they do not feel valued by your organization. 

Customer complaints are also a valuable resource for a company to use. You can listen to your dissatisfied customers and take what they say into consideration when developing new or improving your current goods and services. For example, if you run an e-commerce website and you regularly receive negative feedback about the website’s slow loading, you will then know that speeding up the website will improve your customer's experience and secure their business for the foreseeable future.

Why do customers complain?

In order to gain a proper understanding of customer complaints and how you should handle them, you need to first be well acquainted with the motivations behind a customer making a complaint. Understanding the motivations behind different types of customer complaints allows you to find a solution that benefits the customer without disrupting your operations. Understanding the reasons behind a complaint can also help you to sift through the complaints and find the ones that are worth listening to.

Customers usually complain when there is a gap or misunderstanding between their expectations of your goods and services versus their experience of using them. As a result, customer complaints are largely intertwined with how customers expect your offerings to be compared to how they feel after paying. To gain an understanding of how a given customer expects your offerings to be, requires you to understand the following types of customers:

• Disgruntled: Customers who are angry, frustrated, and unhappy 

• Loyal: Customers who are repetitive and have strong habits formed around your goods or services 

• Satisfied: Customers who are happy, friendly, and polite toward your company

• Curious: Need assistance finding what they want and will ask basic questions to understand your offerings

• Demanding: Customers with very high expectations and are often impatient

Consumer complaints are not always bad for business. Here’s why

Customer complaints offer crucial insights into pain points and issues with a company’s products and services. A number of large corporations conduct expensive paid research and focus groups to identify mistakes and find potential issues with their offerings. However, by listening to upset customers, you can get the same value from the people offering free insights after paying you for goods and services.

According to Lee Resource International, only one in twenty-six unhappy customers actually voice their complaints, so when they do, you should act on it. It is not every customer who will complain where there is an issue, many will instead vote with their feet instead. As a result, you should cherish every customer complaint as an opportunity to retain the customer and prevent them from complaining about your services, driving more customers to your competitors.  Also, Microsoft research states that 95% of customers cite customer service as important in their brand choice and loyalty. 

The manner in which you deal with upset customers also has a significant impact on how the complainer will then act. When you listen to your customer complaints and take their feedback on board, you can make them feel like their opinion is important to you. Then finding a suitable solution to their complaints shows that you care about how they interact with your goods and services, and it highlights that you have the competence to find solutions specific to their needs. This establishes trust among your customer base, which prevents them from looking for an alternative to your offerings. 

To sum up, here are the three reasons why customer complaints are essential for the growth of a business:

• Provides real-time feedback on your products and services. 

• Identifies vital areas for improvement in product and service offerings by highlighting gaps in customer expectations and customer needs.

• Offers opportunities to strengthen customer relationships and improve loyalty.

What are the types of customer complaints?

Being aware of the different types of complaints and common customer complaints helps customer service representatives be prepared to handle angry or difficult customers. This can in turn, help in reducing customer churn and increasing customer retention. Here are the three different types of customer complaints that businesses encounter.  

Product-related complaints

Product-related complaints are related to goods that you have sold to a customer. Product-related complaints typically happen when your product is faulty, does not perform in the manner the customer expected, or is not well fitted for purpose. If your products are damaged on delivery to your customers or are faulty in any other way, you should offer an immediate solution. Typically you can offer a repair, replacement, or a refund. 

Prioritize repairing or replacing the faulty product, as this allows you to keep the money given to your business, even if your profits are reduced. However, if the customer is very displeased, offering a refund can protect your reputation and prevent harmful word-of-mouth influences. 

If the customer complaint is related to the product not meeting their expectations, you need to discuss the issue with the customers to find out what they expected from your product and where it fell short. Perhaps your advertisements were misinterpreted by the customer leading to a misunderstanding, or maybe you need to make adjustments to any instructions included with the product or what the actual outcome of the product will be. 

Service-related complaints

Service-related complaints can arise from a few different sources, including:

• Poor execution- If your service is not performed adequately, where you have made mistakes or caused harm, will likely motivate a customer to make a complaint. Poor execution is a complaint you should definitely listen to as if you get a reputation for providing poor quality of service, your business will not last very long. 

• Delays- Customers appreciate the timely delivery of services. If your customer expects your services to start by a given date and finish within a certain timeframe, failing to meet these expectations will likely upset them. Some industries are more time-sensitive than others, so take this into consideration when giving your customers timeframe expectations. 

• Unprofessional behavior- If you or your staff do not practice professional behavior at all times, it can upset your customers, motivating them to make a complaint. Unprofessional behavior or poor customer service skills will make your clientele feel undervalued, which will motivate them to leave to your competitors. 

Complaints raised due to misunderstanding

The third type of customer complaint centers around misunderstandings. While misunderstandings can feature in the other types of complaints, there are specific complaints that center around customers not fully comprehending what to expect from your goods and services. These complaints can arise from customers misinterpreting your offerings and believing that your product or service will have a better or different impact than the one they received. 

Clarifying your offerings and ensuring that customers can't misunderstand your adverts or listings is crucial for preventing this type of complaint.

How can effectively resolving customer concerns benefit your business?

Effectively handling customer complaints can take your operations to the next level. Here are some of the great benefits you can take advantage of when handling customer complaints:

Increased customer loyalty

When customers believe that you are listening to them when they are unhappy and that you are actively trying to resolve their issues and improve your offerings in the future, the customer will become loyal. They will trust your brand and they will believe that you genuinely try your best to serve your customers to meet their expectations. 

On the other hand, poor customer support can send your customers running to your competitors.

Helps identify key issues

Customer complaints can offer valuable insights into potential issues with your products and services. Identifying issues is crucial for developing high-quality offerings that benefit your customers without causing any inconvenience. Using the complaints you receive to improve how you operate is key in establishing a trustworthy business that retains customers. 

Improved understanding of business space

You get the opportunity to learn more about your customer's standards and expectations within your business space when you receive customer complaints. This allows you to gain insight into industry trends and what your competitors are doing. These insights can help you to identify opportunities for growth, and to identify issues that could face your sector in the coming years.

Brand awareness/reputation

Brand awareness and reputation are arguably the most important aspects of your business. If people associate your brand with high-quality services provided by competent people who are helpful, your business will likely prosper. On the other hand, poor customer experiences will spread through word of mouth, which will deter new leads, and drive away existing customers.

How to deal with customer complaints?

As a business, it’s essential to have the right processes and technology in place to deal with customer complaints effectively. Here’s how you can go about setting that up:

Simplify the process of reporting a complaint

Maintaining a simple complaint-filing process is a good idea. This ensures the complaint is dealt with in a speedy way, while also ensuring nothing gets mixed up along the way. 

Record customer complaints

Keep a detailed record of every customer complaint you receive. This allows you to check back on them over time so you can find insights into where to make improvements. Keeping records of complaints also offers legal protections, should an unhappy customer try to sue you. 

Track and analyze customer complaints

Track and analyze the complaints you receive so you can find trends in where these complaints are coming from. If you are receiving regular complaints about a particular department or service you offer, it could indicate a systemic issue in your company that needs to be addressed.

The ultimate cheat sheet for common customer complaints

Here’s a cheat sheet containing common customer complaints that you can fix by adjusting your customer service strategy or investing in the right tools and technology.

How to resolve customer complaints?

Satisfactory customer complaint resolution can protect your company’s reputation and, if on a public channel, show other customers and potential customers that you care. Handling customer complaints by taking a thoughtful approach that involves delivering consistent experiences can work out well in your favor. Here’s an effective step-by-step complaint resolution process that you can implement:

Step 1: Respond quickly

The longer your customer has to wait for your reply, the more time they have to get more and more frustrated. This frustration can cause them to leave you for a competitor, so act fast as soon as you hear a complaint. Acting fast makes your customers feel valued, and it shows them that you care, which fosters a trusting relationship and secures repeat business.

Step 2: Sense the tone of the conversation

Tone is an important component when responding to your customer's grievances. If you do not correctly grasp the tone of a conversation, it can lead to misunderstandings and cause further frustration for your customers. For example, you are a mechanic, and a customer has complained to you about a tire you recently replaced going flat, making them late for work. If you correctly read the tone, you will respond to them quickly and find them an easy solution. Maybe you could bring them to work or pay for a cab for them while you repair the damaged tire. 

If you misread the tone, you may neglect the time-sensitive aspect of the issue, causing harm to your reputation with that customer. 

Step 3: Get complete information

If you only know half of the information about an issue, how can you expect to find a comprehensive solution? 

If a customer has made a complaint to you, but you feel there is information missing, or if you are struggling to see why they are unhappy, then ask for more information. Ask the customer questions to find out what they expected from your services, how those expectations were not met, what you could do next time to prevent this issue, and most importantly, whether the problem has happened before. 

If you do discover that the issue has happened before, then you need to prioritize a response that satisfies your customer's needs, as repetitive issues can hurt your brand. 

Step 4:  Provide a solution

Last but definitely not least, find a viable solution to the problem raised by the customer. You can reply quickly to a complaint and offer a response that understands everything about the issue, but if you do not offer a solution, the customer will still feel aggrieved. The whole point of interacting with customer complaints is to find improvements for your goods and services that improve your customers' experience. 

You need to consider what your customer expects or demand from your offerings, and how feasible their request is in terms of cost and time for your business. If you have multiple potential solutions and are unsure about which to choose, bring your customer into the decision-making process by offering them different remedies to their grievances.

Other best practices for handling customer complaints

Here are some more important practices to implement when handling customer complaints: 

Active listening/communication

Active listening and clear communication is vital when handling customer complaints. You need to listen to their actual complaints to find out what exactly they are unhappy about. This allows you to empathize with the customer and find a solution that satisfies their needs. If you do not actively listen, you may miss key details that can offer valuable insights into how to fix the problem. Not to mention the fact that a customer who feels ignored will likely not come back to you for goods or services. 

Transparency

Customers do not like to feel like they are being scammed or having the wool pulled over their eyes. You need to be honest and transparent with your customers when they are making a complaint. For instance, your customer has complained about a service provided by a staff member of yours who is still in training. If you do not tell the customer that they are in training, they will believe that your services are not up to their standards. 

However, if you inform the customer that the services were performed by an inexperienced member of staff, you can offer them a discount, or you can ensure that only experienced team members work with them in the future. Being transparent about why an issue occurred helps you to find a solution that the customer can understand and is happy with.

Provide staff with proper resources

Providing your customer support team with adequate resources is crucial when handling complaints. The customer support team needs to know what they are allowed to do when resolving issues, and they need to have the information and resources required to serve your customers' needs. For instance, if a long-term loyal customer is making a complaint, your support team needs to know that they are a valued customer who needs to be helped immediately. This information can be offered to your customer support team by keeping profiles of customers with any relevant information included.

Five tips for agents to manage customer complaints better

Here are five important tips to remember when managing customer complaints:

Stay calm

Do not lose your temper or get frustrated, as this will only make the situation worse. If you get flustered, take a deep breath and calm down before responding.

Assure the customer that you’re working to improve

The customer does not automatically know that you are working on a solution, so make sure to tell them repeatedly that you will find a solution in a timely manner. 

Transfer smoothly

When transferring the complaint to a manager or relevant part, make sure the customer is not left to wait for 10 minutes for them to reach the right person.

Follow up

After finding a solution for the customer, take the time to check in to make sure that their issue has been resolved. Some customers will only complain about something once, so you need to make sure that the solutions you offer work out. 

Learn and move forward

Learn from every complaint you receive and how you dealt with it. Improving the solutions you find for problems will reduce the number of complaints you receive and improve your customers' experience.

Turn customer complaints into compliments with customer complaint software

Dealing with customer complaints efficiently is crucial for maintaining a positive brand reputation and fostering customer loyalty. A customer complaint software like Freshworks’ Freshdesk can help you streamline the process of managing complaints, ensuring a seamless experience for both your customers and agents.

Manage complaints from different channels

Customers may choose to voice their complaints through various channels such as email, phone, social media, or live chat. With Freshdesk, you can centralize all these conversations in a single unified inbox, making it easier for your agents to track and respond to complaints without missing any important details.

Automations for a smoother experience

Freshdesk offers powerful automation capabilities that can help you streamline your complaint-handling process. You can set up workflows to automatically assign complaints to the right agent based on their skill set or the nature of the issue. This ensures that each complaint is handled by the most qualified person, leading to faster resolution times.

Improve inter-team collaboration

Resolving complex customer complaints often requires collaboration between different teams within your organization. Freshworks Freshdesk facilitates seamless collaboration by allowing you to easily loop in relevant team members, share context, and work together on finding the best solution.

Provide options for self-service

Not all customer complaints require direct agent intervention. Freshdesk’s self-service portal empowers customers to find answers to common issues on their own, reducing the load on your support team. You can create a comprehensive knowledge base and integrate it with your support channels, ensuring that customers have access to relevant information whenever they need it

Make data-driven decisions with reporting

Freshdesk’s robust reporting capabilities provide you with valuable insights into your customer complaint data. You can track metrics such as complaint volume, resolution times, and customer satisfaction survey scores. By analyzing this data, you can identify areas for improvement, optimize your processes, and make informed decisions to enhance your overall customer experience.

Handle customer complaints with care

Customer complaints present opportunities for improvement and strengthening customer relationships when handled effectively. By leveraging customer complaint software like Freshworks Freshdesk, you can ensure every complaint is addressed promptly, efficiently, and with the utmost care, transforming potential detractors into loyal brand advocates.

Freshdesk equips your support team with powerful tools to handle complaints seamlessly. Its intuitive interface, transparent communication, and robust reporting capabilities enable agents to respond promptly, analyze recurring issues, implement process improvements, and collaborate cross-functionally to resolve complex complaints comprehensively. With Freshworks as your trusted partner, you can navigate customer complaints confidently, actively listening to customers, empathizing with their frustrations, and working diligently to provide well-rounded solutions that address the root cause of issues, ultimately fostering customer satisfaction and loyalty.