- WHITE PAPERS
LAS VEGAS -- A single dissatisfied customer can cost a pizzeria $50,000. That's why Bill Marvin, aka The Restaurant Doctor advises operators to pull out all the stops in responding the right way to complaints.
In fact Marvin made the title of one of his dozen books on restaurant service and management, "Cashing in On Complaints." That was the title of one of six seminars that kicked off the International Pizza Expo 2002 at the Las Vegas Hilton Feb. 11.
"One guest is worth a thousand times what they spend in the restaurant," Marvin said, addressing about 100 people. "If they spend $50, they're worth $50,000 to you. That's why it's important."
Unhappy guests tend to spread the word about a restaurant, typically telling 8-10 people about an unpleasant experience. One in five unhappy guests will tell 20 friends. That one negative incident has great impact. But there's good news, Marvin said, when the customer complains.
Marvin said that 82 percent of the time a business loses a customer it's because of a staff member's poor attitude or an unadjusted complaint. He said, however, that 70 percent of the time when a customer's complaint is resolved correctly, the customer will return. That number jumps to 95 percent if the complaint is resolved before the customer gets out the door.
"You've got to give your crew latitude to make decisions," he said.
The damage caused by unsatisfied guests goes well beyond their visit. He said you should have just two goals in reacting to complaints - "to shut you up and get you back as a guest."
As an example, Marvin read from an actual complaint letter from a guest of an upscale New Hampshire inn. The guest was certainly justified. Later, he read the proprietor's response, filled with common mistakes, including a discussion of the local labor market, pointing out that the employees were no longer with the Inn, suggesting that the complaint should have been made during the visit, and a lame justification for menu pricing. As a kicker, it was dated a month after the letter was received.
Marvin suggested that complaints are a gift, because he said just one in 25 guests with a complaint actually takes the time and effort to express dissatisfaction. Therefore, he said a response to a complaint should include an apology, acceptance of responsibility and the offer to make it right with an offer of a refund or gift certificate.
Of course, many operators are aware of scam artists who know that complaining about some aspect of the experience will get them a free meal. However, he said that only three in one thousand customers play that kind of game.
He said to think of it as a .3 percent discount, versus the $50,000 cost of a customer spreading negative vibes in the community.
Mark Balsam, a Blackjack Pizza franchisee from Englewood, Colo., said Marvin's emphasis on giving responsibility to all employees on handling complaints is something he'll take back to his store.
"We need to teach every employee how to handle complaints right away," he said.
In an earlier interview in Las Vegas, Peter Picurro, owner of Picurro' Pizzeria, a five-store chain in Tucson, Ariz., said his customer service initiatives leave a lasting impression on customers, and keep them coming back. For example, he said that when customers come in to pick up a pizza and it's not ready, staff members offer a free drink and are encouraged to engage the customer in conversation.
He also incorporates some unusual techniques into his training program.
In fact, he goes so far as to require new employees to read and study a book on customer service, "Positively Outrageous Service", by acclaimed speaker T. Scott Gross.
"The moment you're hired you have the authority to address a complaint. You can turn that person into a loyal customer," Picurro said.
Marvin made a similar point, suggesting that anticipating a complaint may not only keep it from coming, it might be the kind of surprise the customer will talk about to friends. He gave an example of a manager who comped a party's dinner because it was five minutes later than the restaurant's standard, even though no one in the party has said a word.
"It's not about right or wrong, it's about the 50 grand," he said. "You have to have a game plan in mind and give your crew a way to do it. They don't know what to do. You don't want to put people in a situation that's uncomfortable for them."