One of the adages about customer service is that people are much more likely to talk about a bad experience than a good one. The survey contradicts that notion, finding that consumers will talk about a good experience 75% of the time but complain about a bad one 59% of the time. If that’s the case, companies should be investing more in delighting their customers rather than just avoiding a bad experience.

When it comes to your online image, the survey found that consumers put more stock in negative reviews on blogs and social networking sites (57%) than in positive ones (48%), but the percentages are close enough that positive and negative reviews are both important.

The Baldrige Criteria ask several questions about how you build customer relationships including how “you create an organizational culture that ensures a consistently positive customer experience.” The Criteria ask about your processes for listening to customers, managing complaints, and determining customer satisfaction and dissatisfaction. Sound, systematic customer processes are the key to producing very satisfied customers, which the American Express survey shows will spend 9% more with your company than they will if they receive less than excellent service.

To read more about delighting your customers, click on these articles:

• Kano Satisfaction Model
• Fast Food Customer Focus
• Be Careful How You Measure Customer Satisfaction
• 9 Ways to Get Closer to Customers
• Bottom-Line Value of Customer Engagement

The point of the Kano Satisfaction Model is that organizations need a profound understanding of their customers’ requirements to increase satisfaction and secure loyalty. Not all customer requirements are equal. The Baldrige Criteria ask: “How do you use customer, market, and product offering information to identify and anticipate key customer requirements and changing expectations and their relative importance to customers’ purchasing or relationship decisions?”According to Kano, “relative importance” can be characterized as basic, performance, and excitement.

Basic services or features do little to improve satisfaction unless they fail, in which case they can cause serious dissatisfaction. We expect the checkout lane in a store to move relatively quickly and without any problems. When it does, we don’t feel more satisfied with the store because that is what we expected. When it doesn’t, we feel frustrated and dissatisfied.

Performance services or features are those that produce customer satisfaction. If the store you are visiting is Wal-Mart and you get excited about paying the lowest prices, the signage showing great deals is a differentiable service. If you are shopping at Target, the wide and welcoming aisles and the quality of the merchandise may be differentiable services. Wal-Mart, Target, and other stores must be clear about the drivers of customer satisfaction to attract and retain customers.

Excitement services or features are the unexpected “wows” that customers experience. It may be an unexpected low price, a particularly helpful clerk, or product selection beyond your expectations. These are the moments that cement relationships with your customers and prompt them to tell others about their experience.

Kano’s model is hierarchical: You must provide the basic services before you can offer differentiable services, and you must do both before you can “wow” your customers.

And before you can do any of these, you must be absolutely certain that you understand who your customers are and what each customer group requires.

To learn more about customer satisfaction and engagement, click on these articles:

• Creating a Unique Customer Experience
• Stakeholder Mapping
• Be Careful How You Measure Customer Satisfaction
• Walk in Your Customer’s Body Armor
• Bottom-Line Value of Customer Engagement
• 10 Critical Questions: Your Customers

Guess which industry Kevin Drum was talking about in his column?

No, it’s not credit card companies since they probably have a few wealthy customers who aren’t getting gouged by 29% interest rates.

The answer is: the airline industry.

Drum does an excellent job of summarizing how the airlines have behaved:

1. First, they hassled customers about carry-on bags and convinced them to check their luggage instead.
2. Next, they started charging for checked bags.
3. As a result, customers stopped checking their bags and started fighting for space in overhead bins.
4. American Airlines saw a new opportunity, not to improve customer service and alleviate the bin shortage on planes, but to make a few bucks by charging for “select” coach seats that gives those passengers willing to pay for it dibs on the bin space.

Same crappy seats. Same lack of any amenities. Just peace of mind that your bag will travel with you.

It won’t be long before other airlines follow American’s lead, and it won’t be long after that before airlines start charging for every bag whether you check it or not. And we’ll pay it because we don’t have a choice if we want to fly.

There’s a reason no airline has won the Baldrige Award: Their behavior contradicts one of the Baldrige core values called “customer-driven excellence.”

To read more about customer-driven excellence, click on these articles:

• Creating a Unique Customer Experience
• System Failure
• Do You Trust Your Customers?
• Be Careful How You Measure Customer Satisfaction
• Walk in Your Customer’s Body Armor
• 9 Ways to Get Closer to Customers

I’m talking about Delta Airlines. I was scheduled to fly back from Lexington, Kentucky, on Monday night at 7:30. I heard an announcement that a flight from Atlanta to Lexington had been delayed so I checked with the Delta rep at the gate to see if that was my airplane. It wasn’t. I joked about how lucky I was to get a plane coming from Detroit. She said the flights from Atlanta and Detroit seemed to alternate having trouble.

As take-off time approached, we were told that the plane’s engine wouldn’t start and a mechanic had been called. Twenty minutes later he showed up. About 45 minutes later we were told the plane was ready to go and we trudged out to the last plane leaving Lexington that night.

Once everyone was settled and the door closed, we waited and waited and waited for the engines to start and cheered when they finally kicked in. We taxied for take-off and then we taxied some more. Lexington is a small airport so if you taxi for ten minutes, you know something is wrong and, sure enough, we found ourselves back at the gate. The pilot told us the crew had reached its time limit and couldn’t continue. Did I mention this was the last plane out of Lexington?

So we stood in line for a half-hour to get rebooked the next morning and get hotel vouchers. The hotel shuttle driver joked about how often he picks up Delta fliers that time of night. The hotel clerks joked about Delta being its best customer. We who could not get home were not amused.

Flying back Tuesday morning, I sat next to a woman who flies Delta regularly from Atlanta to Minneapolis and she said when she gets to the company she’s working with, the people always ask for her travel horror stories. One time the plane flew with the landing gear down because they feared that if they retracted it, it would stay retracted. She had lots of stories.

I want to add that every Delta employee I interacted with was polite and helpful. This is not a people problem. It’s a system failure. The system for maintaining airplanes and scheduling them and meeting the schedules isn’t working. It sounds like it hasn’t been working for awhile. System failures are management’s problem. Delta has a serious leadership problem.

Customers beware.

To read about excellent customer service, click on these articles:

• Stakeholder Mapping
• Do You Trust Your Customers
• Walk in Your Customer’s Body Armor
• 9 Ways to Get Closer to Customers
• Bottom-Line Value of Customer Engagement

A month later I stayed in the same hotel. Same thing happened, although they were more efficient this time: They told us to ignore the alarm before I could get my shoes on.

The next morning, the hotel forgot my wake-up call.

When they sent an email asking me to take a short survey, I did, explaining why the false alarms and missed call accounted for the low scores and the likelihood that I wouldn’t stay there again.

A week later I received an email from one of the hotel’s managers apologizing for the alarms and missed call and promising changes to keep both from happening. He offered a coupon for a night’s stay the next time I was in the city. I took him up on it.

In “Hotels Answer Online ‘Tidal Wave of Whispers’” (USA Today, March 25, 2010), TripAdvisor states that less than 4% of negative reviews of hotels at its site get a response. And that’s after a 203% increase in responses from the previous year.

Some hotels are realizing that negative reviews are opportunities to lure back disgruntled customers and identify and correct the problems that upset them. Hilton is testing software that aggregates reviews on Web sites, blogs, and other social media sites. Marriott and Marriott-brand hotels monitor more than a dozen Web sites and list key phrases such as bedbugs, eviction, and security that get immediate attention.

Those hotels that are ignoring 96% of online negative reviews are missing an opportunity to increase customer satisfaction and loyalty, find and fix issues, and improve performance. And in this economy, who can afford to do that?

To read more about customer satisfaction and dissatisfaction, click on these articles:

• Be Careful How You Measure Customer Satisfaction
• Walk in Your Customer’s Body Armor
• Lessons Learned from Dell Hell
• 9 Ways to Get Closer to Customers
• Word of Mouse

It strengths obscured its weaknesses, one of which was the lack of systematic approaches to engaging customers who were not corporate buyers. Dell assumed that the orders it received every day told it all it needed to know about its customers. It took orders. It didn’t listen. And that had to change.

In the introduction to Mark Benioff’s book, Behind the Cloud: The Untold Story of How Salesforce.com Went from Idea to Billion-Dollar Company—and Revolutionized an Industry, Michael Dell, founder, chairman, and CEO of Dell, describes IdeaStorm, an online community forum the company uses to get ideas from its customers. As of today, customers have contributed more than 13,000 ideas through IdeaStorm, which were promoted by other customers nearly 710,000 times, with more than 88,000 comments. Dell has implemented 390 of its customers’ ideas.

In truth, IdeaStorm is a response to “Dell Hell,” a post written by blogger Jeff Jarvis in 2005 that became a lightning rod for customer complaints about Dell’s service. Jarvis had bought a Dell laptop that didn’t work and he couldn’t get anyone at Dell to help him. His post tapped a deep vein of frustration among Dell customers. The company had gotten too big, had focused too much on cutting costs, and had drifted when its visionary founder retired. One could argue that Michael Dell returned to lead the company because of the firestorm caused by Dell Hell.

IdeaStorm is one of several approaches Dell has implemented to listen to and learn from its customers, but while it is getting better at engaging customers, it still has problems satisfying them. A Google search of “Dell customer service” reveals page after page of disgruntled customers, some as recent as this month.

The lessons to be learned from Dell’s experience are:

• Design processes for listening to and learning from customers at the same time you are designing your products and services
• Implement processes for gathering, analyzing, and acting on customer information
• Identify key measures of customer engagement and satisfaction and communicate performance on those measures
• Make customer-driven excellence a core value of your organization now, before you get a reputation for driving customers away

To find out more about customer-driven excellence, read:

• Dangerous Assumptions about Customers
• Bottom-Line Value of Customer Engagement
• 10 Critical Questions: Your Customers
• Creating a Positive Customer Experience
• 9 Ways to Get Closer to Customers
• KEYSTONE: Customer Knowledge

In previous articles we listed 10 critical questions you can ask about leadership, strategic planning, and key strengths and opportunities for improvement. As we noted, the best way to evaluate your management system is through a Baldrige assessment using the Baldrige Criteria. You can find out how to do that here.

The Criteria consist of powerful questions, rarely asked, about how an organization functions. If you cannot do a full assessment but want insight into how to improve your customer focus, here are 10 critical questions to ask and answer:

1. What are your key customer groups or market segments and what does each group/segment require of your organization?
2. How do you determine which groups/segments to serve?
3. How do you determine the requirements of each group/segment?
4. How do you identify and innovate products, programs, and/or services to meet these requirements and exceed expectations?
5. How do you support your products, programs, and/or services and enable your customers to seek information and utilize them?
6. How do you create an organizational culture that ensures a consistently positive customer experience and contributes to customer engagement?
7. How do you build and manage relationships with your customers?
8. How do you listen to your customers to get feedback on your products, programs, services, and support, including managing complaints and determining customer dissatisfaction?
9. How do you determine customer satisfaction and engagement, including satisfaction with your competitors or other benchmarks?
10. How do you use the customer information described in answers to the questions above to evaluate current and future customer groups and their requirements and to build a more customer-focused culture?

To read the world-class responses of Baldrige Award recipients to these questions, click here and then click on the award application summary you wish to review. Begin with the response to P.1b(2) in the Organizational Profile to see who the organization serves and these customers’ requirements, then go to Category 3, Customer Focus, to find out how it engages its customers for long-term success.

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