ANSWER: Lessons about customer service excellence…
When you think about customer service, what usually comes to mind first? It’s probably one or more of what I call the 3P’s of cultivating loyalty. Foremost is always People, those individuals charged with the great responsibility of creating the memorable experiences with the customers. Then there is Process, the operational elements that constitute the paradigms, systems and strategies that make it easy for a customer to do business with an organization. Lastly, there is the Product which of course is the goods and services that the end user will purchase.
The fact still remains that even with the best combinations of people, process and products there are times when unfortunately things just don’t go according to plan. People can misinterpret how or what has been communicated to them, systems and processes can get interrupted or sometimes people simply do not like the product that was received. When these situations occur, what follows is the fourth element of customer experience or what is often referred to as, recovery. And so enters the “Nordstroms Principle” and the art of, “give them a reason to return and do business with you again”.
Most people know of Nordstroms and the company’s reputation for very high levels of customer service, their live piano players in the stores and anything but bargain prices. What many do not know is that Nordstroms has been legendary in the retailing community for extremely liberal return policies. Their whole premise for service recovery was not to simply make the customer go away, but to give them a reason to return and make them a fan for life. I’ve been very fortunate to have spoken with and interviewed many Nordstroms employees, their stories have always been the same; “We allowed customers to return anything whether they had a receipt or not”. In fact my favorite question was always, “what was the strangest thing you’ve ever had a customer try and return?” An example from an employee named, Amy;
Amy: “I had a gentleman try to return a set of 4 used tires.”
Amy: “Yup, really old ones too, bald. You could tell they had been in the garage a long time.”
Me: But Nordstroms doesn’t sell tires, why would this guy think that he could return old beat-up tires?
Amy: “The customer had lived in the neighborhood for 50 years and apparently there was a tire store on the property before Nordstroms came around. He seemed to think the two were related.”
Me: What did you do?
Amy: “I took the tires and gave him a store credit, like $25 or something.”
Amy: “Yea, that was always the plan with Nordstroms. Besides, the guy turned around and spent a couple hundred bucks right afterwards.”
Sounds counter intuitive doesn’t it? But think about the strategy behind it. First, the company saved money on a $25 coupon that they would have mailed to that customer in direct mail or in some expensive advertising campaign anyway. The employees get to find a reason to say yes, make the customer feel great about doing business with Nordstroms with no immediate cash out of pocket for the store. Finally, it gives the customer a reason to come back and shop again and you can’t buy a pair of shoestrings at Nordstroms for $25 bucks. Not to mention the fact that customer becomes a raving fan and tells others how great Nordstroms is to do business with. You cannot buy that kind of advertising!
So is every recovery situation going to be the same? Probably not, no two customers are the same nor is the reason that brought them to your door. Contrary to some beliefs though, not every customer is looking for something for free. Many realize that mistakes happen and simply want to know that you are showing a sense of urgency to find a solution. Most just wanted to be heard and know that their feedback is taken seriously. Here are five elements to the Nordstroms customer recovery philosophy common to every employee I’ve ever interviewed;
- Do it with a smile – Make the customer feel welcome, even though they are returning an item.
- No hesitation – It’s easier to return the item, move on and encourage the customer to shop.
- Less is more – No explaining of policy or why, “we normally don’t do this” conversations.
- It’s what you say AND how you say it – Focus on solutions and what can be done.
- Case by case, not policy – Some may insist on cash refunds, but each case is independent.
Lastly, an old business mentor once taught me, “No matter what road you lead a customer down, make them feel great about it.” Make raving fans of your customers and give them a reason to return.