Ep. 46 How to Hug Your Haters to Improve Customer Experience

Inviting and Answering Complaints Strengthens the Customer Experience and Improves Satisfaction

This week’s guest is renowned business strategist Jay Baer. A seventh-generation entrepreneur, he has founded five multi-million-dollar companies and is the New York Times bestselling author of six books on customer experience and digital marketing. He has advised more than 700 companies and has been inducted into the Professional Speakers Hall of Fame. Jay is most often described as funny, factual, fantastic, and fashionable! In this episode of the Digitally Irresistible Podcast, Jay unpacks the principles he writes about in his book, “Hug Your Haters.” With 80% of companies saying they deliver exceptional customer service and only 8% of their customers in agreement, he shares how businesses can turn things around and improve customer satisfaction.

A Career of Influence

Jay Baer began his career journey as a political campaign consultant before pivoting to traditional marketing and then digital marketing back in 1993 when domain names were still free. Ultimately becoming a trusted advisor on customer service excellence to some of the world’s most iconic brands, Jay started a digital consulting firm that he sold before starting another one called Convince & Convert that he ran for 13 years before selling. Along the way, Jay has created a successful content marketing blog, thousands of podcast recordings, a series of bestselling books, and keynote speeches to inspire digital marketing success.

Welcome the Complaints

In his book, “Hug Your Haters,” Jay writes that in order for companies to improve the customer experience and reduce the number of complaints they must first get more complaints. Jay learned the principle from his friend, Erin Pepper, who was the head of customer experience at Le Pain Quotidien. She implemented a plan to help the brand of cafes and bakeries continue to be better than most of their competitors by tripling the number of complaints they received.

Her goal was to make sure they responded to everything that bothered their customers and the only way to do that was by learning what actually bothered them. She recognized that there were probably some things that their customers didn’t like that they didn’t even know about. So, she created nudges for feedback on social media, the brand’s website, signage, and trained cashiers to seek feedback to make clear to customers that they really wanted to know what they thought about their experiences at the cafe.

Through these efforts they received three times more complaints and identified many things they hadn’t realized they were doing wrong. For example, at one of their top-selling locations someone mixed up the formula for their signature lemonade. Many customers were unhappy about it but no one said anything until Le Pain Quotidien really made a concerted effort to listen. They took this and all the other feedback they received, responded to the problems, and customer satisfaction improved.

It became clear that in order to get fewer complaints, a company must first get more complaints and then respond to them. Celebrating having only a few complaints doesn’t necessarily reflect excellent customer experiences, it often means the customers aren’t talking or can’t be bothered to share their concerns with the brand. Complaints are necessary in order to gain insight into where improvements can be made.

Statistically, only five out of 100 unhappy customers will register a complaint. Out of these complaints, there’s about a 50/50 mix of offstage and onstage complaints. Some customers prefer offstage remarks like personally speaking with a manager or sending an email for an individual response. In contrast, customers who have undergone their own digital transformation journey are often more likely to make highly visible onstage public remarks on social media platforms such as Facebook, Instagram, and Twitter or post a negative review on Google or Yelp. These customers prefer an audience for their dissatisfaction that will commiserate with them or show sympathy. Onstage complaints can be detrimental to a brand if people start to pile on and if the brand doesn’t respond.

Answering Complaints Drives Customer Satisfaction

In preparation for his book “Hug Your Haters,” Jay and his team conducted a large national study on customer attitudes around dissatisfaction and discovered that the number one driver of customer satisfaction over the mid- and long-term is not actually fixing the problem, its simply answering the complaint. Jay finds it shocking how few customer complaints actually receive responses, even by large multinational corporations with extensive resources.

Brands don’t even have to fix the problem to see improved satisfaction. If they just answer the complaint they will see a 40% increase in advocacy, depending on what the complaint is and where it was waged. On the flipside, not answering just makes it worse. As customer service and experience expert Shep Hyken says, a customer you ignore is a customer you should be prepared to lose.

But often, unhappy customers are written off. No response is a response. It says the brand cares so little about the customer that they’re going to ignore their concerns because it’s easier and less expensive to replace said customer than to respond.

Part of the problem, Jay finds, is that in thinking about customer satisfaction, brands are sometimes led astray by how customer satisfaction and customer success are measured. For example, the Net Promoter Score (NPS) is often used as a key number to measure CX in many organizations. An NPS in the 50s is generally considered very good, but that means only about seven or eight out of every 10 customers would actually recommend the brand. Likewise, a customer satisfaction rate of 90% is considered excellent, but looking at that same number in a different way can give a different perspective. It wouldn’t be viewed as a great success if one out of every 10 customers hates the brand. So why aren’t companies aiming for 99% or 100% customer satisfaction rates?

Because sometimes the math gets divorced from the reality. Some executives see the numbers and commit to responding to complaints universally and uniformly. But many others see challenges in responding to customer concerns in high quantities across multiple channels with limited customer service resources.

Marketing and Customer Experience Go Hand-in-Hand

According to recent research from Salesforce, marketing departments lead customer experience initiatives in eight out of 10 global enterprise companies. In Jay’s experience, most marketers are really good at branding, increasing awareness, and developing new customer acquisition strategies. He finds that many marketers, however, aren’t as good at answering complaints and improving customer satisfaction and customer retention because historically that’s a different part of the business with a different skillset and even a different educational underpinning.

The goal then is to help marketers truly understand the totality of the customer journey so they can invest the same level of thought leadership and effort around customer retention that they do for customer acquisition.

An added layer of complexity to the relationship between marketing and customer experience is the complexity and volume of the tech stack related to each. When you add a CX tech stack with speech analytics into an already complex marketing tech stack, it expands tools available to marketing professionals but also requires a higher level of understanding.

That said, the tech stack a business uses for customer success and retention is often owned and powered by the same company that develops their tech stack for customer acquisition. This foundation can provide a holistic understanding of the customer by streamlining the management of data and preferences throughout the customer journey—from customer recruitment and customer onboarding to customer interactions over time.

In sum, structuring the customer experience team to report into the top marketing leader for complete ownership of the customer journey allows for an integrated understanding of the customer. Additionally, utilizing unified technology to track customer engagement further enhances a brand’s ability to ensure high customer satisfaction rates.

Turning Lemons Into Lemonade

Haters are not the problem. No company is perfect. There will always be customer complaints. The key is to quickly respond to those complaints with empathy and turn lemons into lemonade.

Many brands treat people who are unhappy as if they are the least important customers, but in many cases they’re the most important customers. People who take time out of their day to give feedback to a company deserve a response, especially when the majority of unhappy customers say nothing.

When people care enough to share what they think can be done better in a business, it’s worth listening and providing the dignity of a response, and maybe even making some operational changes. If a company does this often enough, they will improve their business intelligence to grow and ultimately improve their brand.

Outsourcing CX to a business process outsourcing (BPO) partner like iQor can provide customer service expertise and omnichannel resources to respond to concerns through voice, social media monitoring, chat, and other channels quickly and uniformly so all customers receive a response that makes them smile.

What Jay Does for Fun

Jay is all about fun! Sports. Barbecue. Tequila. Plaid suits. He has curated a collection of 16 plaid suits in different shades and colors. He’s a certified tequila sommelier (a catador) and creates tequila lessons on TikTok and Instagram. He’s also a certified barbecue judge.