Business Killers: Bad Word of Mouth

Dan Blank -- Expert Business Source, 1/25/2007 8:26:00 AM

What is the one factor that can undo all of your careful marketing efforts, and years worth of building goodwill with customers and your community? Bad word of mouth. As the saying goes, a few bad apples can spoil the bunch.

A study on customer dissatisfaction found:

“…more than 50% of Americans report a negative shopping experience they've heard about from a friend or family member will prevent them from shopping that particular store altogether.”

This is dangerous because it not only wipes away your past marketing efforts, but your future efforts as well:

“…people told about a store's poor products or services and no matter what that store does to entice shoppers those people will not set foot in their store.”

Here are two reasons it is difficult to keep your finger on the pulse of negative word of mouth:

• Customers who have a problem are five times more likely to tell their friends about it rather than contacting the store itself.
• Customers who have a bad shopping experience will tell four people on average.

These are the top areas for customer complaints:

• Time.
  They can't find parking and it takes too long to get in or out of the store.
• Merchandise.
  Hard to find product, store layout is confusing and there's no product information on displays.
• Staff.
  They have poor product knowledge and lack courtesy.

Some tips for preventing bad customer experiences:

• Presentation.
  Take a little time to really look at your stores, outside and in. Are there messy areas that can easily be seen by customers? Take their view into account, not just what works for your store’s internal process.
• Customer experience.
  View the customer experience from the beginning to end – from finding parking, to exiting the parking lot. If you have a time crunched customer base, keep the stop-watch running as you go through a mock sales process. If you are ‘too close’ to your products, then have a friend help you look at your store with new eyes.
• Listen to customers.
  Chat with some of your customers and find out how their latest shopping experiences have been. Don’t look for easy answers or only ask customers you have an established rapport with.
• Do some homework.
  Have someone "spy" (a.k.a. mystery shop) on your store to find out what your employees are like when you aren't there, you might be surprised.