How Much of an Impact Do Unhappy Customers Have On Your Business?


How much does customer dissatisfaction impact your organization? Hint: it is much more than companies tend to realize. Read the information below to understand the impact and resolution that customer dissatisfaction has on your business.

  • How many dissatisfied customers does your organization have? Harvard researchers found that an alarming 96% of unhappy customers do not complain to the offending company! Given this, guessing how many dissatisfied customers you have can be a bit of a mystery. Fortunately, there’s a simple calculation that acts as a proxy: divide by 0.04 the total number of customers that have complained to you directly. This calculation provides a ballpark estimate of the number of dissatisfied customers. For example, if 12 customers have complained to your organization, then approximately 300 unhappy customers exist [12/0.04 = 300].
  • How is your organization’s reputation affected by one unhappy customer? Researchers also found that for every 25 dissatisfied customers, between 200-500 additional people hear about their negative experience! This means that one unhappy customer may, over time, complain to 8 to 20 people! To estimate the full reputational impact from dissatisfied customers, multiply the amount from bullet #1 by 8. For example, 300 unhappy customers can mean that 2,400 people hear about it!
  • How to increase customer retention: Given the far-reaching impact of customer dissatisfaction, it’s essential to ensure that your organization is doing what it can, within reason, to keep customers happy.
    • Reward good customer service behavior: Set policies and programs in place that reward positive behavior on the part of the customer service representative. Rewards yield repeat behavior.
    • Clarify the business results: It’s almost always a great idea to show employees the fruits of their labor. Periodically track satisfaction metrics such as the Net Promoter Score® or overall customer satisfaction. As customer service improves – as measured by the metrics just mentioned – share this improvement with your employees.
    • Provide professional development training: Not only has professional development been shown to correlate with reduced employee turnover, but formal training will help the employee not just understand “why” performance needs to increase, but “how” to increase performance in the first place.

The Crestcom Bullet Proof® Manager program develops managers into leaders by showing them how to approach a variety of business issues such as customer satisfaction.

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