Stay Updated! COVID-19 pandemic business resources hub »

Problem Customers, What Can You Do?

You can tell that people are getting fed-up with the airline industry, and the truth is that they have a lot to be fed-up about. Just consider the headlines from today’s news:

These are just from this morning and the day is still young. How about the hours that Jet Blue’s passengers had to endure sitting on the tarmac just feet from the gates? Then there was the man in 1st Class on the British Air flight from New Delhi to London who found that he was seated next to the corpse of a woman who died in Economy and was told that he should “just get over it.” Now, I am a fan of the traditional British stiff upper lip, but that was ridiculous! The point is that you would think that with the image of their industry as bad as it is today, what with all the hidden fees, surcharges, poor customer service, slashed amenities, late arrivals and departures, lost luggage and such that airlines would be doing everything they can to make flying easier and more pleasant. After all, it isn’t the passengers causing all the problems, it is the airlines themselves. Their policies, attitudes and actions are creating a great deal of ill-will within the traveling public. Knowing this, you would think that they would be trying to improve the situation. You would be wrong. Instead, the airlines seem quite content to take the high-handed approach and fire their customers.

Problem Customers: Is Firing the Only Option?
The example of the airlines is, admittedly, extreme; but it does throw the issue of poor customer service and management arrogance in sharp relief. Even for businesses that don’t deal with irate or difficult people within the confines of a high-flying aluminum tube hurtling through the air at hundreds of miles an hour, the idea of firing a problem customer can be very enticing. It rids you of a difficult and sometimes expensive situation. It also rids of you of potential new business, referrals and all the other benefits that come from a decent business relationship.


There are some things you should do to try and salvage the customer before you determine that their business is no longer worthwhile. You should not take severing a business relationship lightly and these suggestions will help you give the question all the thought and consideration that it deserves.

Plan Ahead
Just as you have a procedure for evaluating employees, you should likewise have a system for evaluating customers. In his book, 101 Ways to Boost Your Business Anywhere, author Tom Egelhoff takes a lesson from Hollywood , suggesting lettered lists to describe the different categories that the customers you serve might fall into.

“I suggest that business owners arrange your customers in A-B-C-D order. A list of your best most profitable customers would be your A list. Those who do less business or are more of a problem are ranked accordingly in a lesser category,” writes Egelhoff. “The danger of this is being inflexible. Customers and businesses are never stagnant. A business can grow and become a good customer and move up your list. If you are going to use this method then be prepared to re-evaluate your customers periodically.”


Once you have a way to evaluate customers, you will need to be able to spot them. Your D-listers will likely be apparent to any of your employees, as long as they breathe and have a pulse (at least to the extent that they won’t qualify for an upgrade from Economy to 1st Class on British Air). The A-listers shouldn’t pose much of a problem either. It’s the folks in the middle that you will have to work at spotting and categorizing.


The most likely spotters on your payroll will be your sales people. Your bookkeeper can give you numbers to confirm or deny the assessment, but that first word that something is wrong with a customer will probably come from sales. As much as their role is sales, it is also problem resolution and reporting. If they cannot deal with the customer’s issues, then the problem should be kicked up to management/the owner for resolution. It is at this level that customers are placed on one of the lists.  


Take Action
Suppose that you have established a rating system and your crack sales force has identified a good candidate for the C-List, maybe even the D-List. What now? Put them on the list and carry on with your day? Fire them?  


Actually, yes and no. Yes, by all means list them where you think they belong but don’t fire them, at least not yet. Remember, just because a customer starts out on the D-List, that doesn’t mean they are condemned to remain there. Their ability to move out of the basement, however, depends to an extent on you. You need to take a stab at solving their problem.  


Remember, their problem will have, essentially, two parts to it. The first is the issue itself—scheduling, billing, product quality—whatever it is that made them angry and difficult in the first place. The second part is not quite so cut-and-dried. It is the issue of how this customer has perceived their treatment at the hands of your staff. What might have started out as a reasonably small problem—if handled poorly—can easily expand out of all proportion.  


Unless the issue is one of product quality or a terrible lapse in service, it usually arises from a misunderstanding between your company and the customer. They expect one thing and get another, or something that they did not expect happens. The solution to these is usually a patient explanation and a request that the customer work with you to set things right. Working with you, in this case, simply means helping you to work in the most efficient way possible to get things back on track.  


While you are doing this, you also have a chance to settle the less tangible issue of how the customer was treated. I am not saying here that any of your people would have done anything wrong. In fact, they could have done everything right according to your internal procedures and things could have still ended up badly. It is not about what happened, it is about perception, about how the customer experienced it.  


Knowing that, it is left to you to be the very essence of customer service—caring, helpful, committed and involved. Put the red carpet out for this customer and make them feel special. The better they feel, the more likely they will be to work with you, making a resolution of the problem that much easier.  

However, there are those you will not reach, no matter how hard you try. In his article entitled “ Problem Customers: Fire Them ,” business consultant Wayne Hurlbert describes problem clients like this: 

A problem client will always be demanding, both in terms of time and concessions. The most common first taste of poison is the chiseling of the price or fee schedule. While some negotiation is often necessary to land a customer, the difficult client will demand a price reduction so low as to preclude profitability. Beware of any prospect that demands pricing below even the standard profit level. The huge upfront discount required is often the first step to even further price reduction demands.

Another toxic client trait is the constant demand for your time above and beyond the standard amount, or even the maximum time allotted in the contract. Constant phone calls, e-mails, and in person visits are their stock in trade. Rarely is the visit to pay a compliment or a bill. The purpose of the visit or call is usually to extract more free work; or even deeper fee and price cuts. Free work is their goal, and they very often receive it, just to get them to leave the busy business person alone.

Failure to pay even the deeply discounted bill is another common practice among the problem crowd. While they are always willing to phone you, and even be irritated if you are not available, the opposite is true for their bill paying time. They are simply unavailable at any time. After completion of their contracted work, headaches and all, they are slow to pay the invoice. Many times, they refuse to pay at all. They will cite shortcomings in the work as the reason, and attempt to receive even more free work. They might not pay even then.


These are people who cause trouble for the sake of trouble, who complain simply to see the reaction people have to their voices. These are the customers who fall off the end of the D-List, the ones you fire.  


Ready, Set, FIRE!
You have done what you can, and probably more than you should have. You have bent over backwards so far and so often that you have ruptured discs up and down your spinal column and now it is time to make this guy someone else’s problem. But how can you do it without this customer smearing your reputation all over the place?  


The best way to do it is to try not to end the business relationship on a negative note. Be diplomatic, but also be honest and forthright about your decision and the reasons behind it. Make sure that the soon-to-be-ex-customer understands that you are making a business decision, not a personal one, and offer to help them find a replacement for your services if that is appropriate. Still, the precise method you use to execute this plan depends largely on how successful you feel your diplomacy and honestly will be and just how badly this customer drove you and your staff crazy. The methods available run the gamut of civility and diplomacy from a carefully-worded letter or a terse e-mail to driving the customer crazy with fees (seems to be the airlines’ preferred method) or even a scorched-earth style confrontation.  


The Bottom Line
However you do it, do it right and do it quickly. Not for the sake of the ex-customer, but for your own. It is time for you to shake off the dull headache that was the customer from Hell and begin to enjoy your company and your work again. You owe it to yourself and you owe it to your employees.