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Word of Mouth: The Power of the People

Word of Mouth: The Power of the People

Word of mouth is increasingly important as review sites like Yelp and Angie’s List gain popularity.

According to Vendasta, 78% of consumers trust online peer recommendations and reviews, while only 14% trust advertising.

And according to the White House Office of Consumer Affairs, on average a dissatisfied customer will tell between 9-15 people about their experience, while around 13% of dissatisfied customers will tell more than 20 people.

So, when the inevitable happens and a public relations (PR) disaster rears its ugly head, it needs to be taken care of quickly and methodically.

An example of a company that did everything right after a major PR disaster was Johnson & Johnson after the Chicago Tylenol murders in 1982, during which seven people in the Chicago metropolitan area were killed after taking Tylenol-branded acetaminophen that had been laced with potassium cyanide.

In an effort to reassure the public, Johnson & Johnson distributed numerous warnings and halted Tylenol production and advertising.

Word of Mouth: The Power of the People Tylenol Graphic

It also issued a nationwide recall of Tylenol products and advertised for individuals not to consume any of its products that contained acetaminophen after it was determined that only these capsules had been tampered with.

Johnson & Johnson even offered to exchange all Tylenol capsules already purchased by the public for solid tablets.

The actions taken by Johnson & Johnson to reduce deaths and warn the public have been widely praised as an exemplary public relations response to such a crisis and the company has been applauded for its honesty with the public.

An article in The Washington Post said, “Johnson & Johnson has effectively demonstrated how a major business ought to handle a disaster.”

Here are a few words of advice to keep your reputation squeaky clean and avoid a major PR disaster.

Tip #1 | Offer reparations.

To make up for any inconvenience, offer your customer reparations.

This can be in the form of coupons, free services, refunds, etc.

Even Airbnb, after numerous hosts’ homes were ransacked by guests, was able to soothe a few angry customers by offering them free stays and refunds.

Ask what you can do to help the situation and be prepared to give.

Tip #2 | Be mindful of your marketing.

Companies need to be careful with their marketing — avoid giving customers the wrong impression or making empty promises.

For example, Airbnb’s Host Guarantee promises to protect hosts’ peace of mind and belongings with a $1 million guarantee.

In reality, hosts found that the guarantee was riddled with fine print and before it covered anything, their situation had to fit Airbnb’s near-impossible standards, resulting in numerous hosts being denied compensation for guest damages.

Instead, live up to your word and stay honest.

Tip #3 | Have a plan.

Prepare in advance and have a plan if something goes wrong.

This can help you avoid a PR disaster and keep your reputation clean.

Tip #4 | Utilize the Better Business Bureau (BBB).

The Better Business Bureau is a nonprofit organization dedicated to protecting consumers and helping businesses resolve complaints.

The BBB prospects successfully vetted businesses to become dues-paying Accredited Businesses that pledge to continue to adhere to the BBB Code of Business Practices.

Additionally, the BBB acts as a neutral party to help mediate complaints and disputes, which is very helpful when managing a company’s reputation.

Tip #5 | Monitor your online presence.

Google your company every few weeks to see what people are saying.

This can give you a chance to do some damage control before things get out of hand and your company’s reputation tanks.

Tip #6 | Don’t write fake reviews.

Huge no-no. Don’t even think about it.

Tip #7 | Be attentive.

According to Forrester Research, 77% of people say that the most important thing companies can do to provide good service is to value their time.

Replying to complaints quickly is also the key to gaining customers’ loyalty. According to Convince and Convert, replying to complaints quickly can increase customer advocacy by 25%.

Whatever the situation is, be sure you always respond to customer complaints as quickly as possible while doing everything you can to correct the issue.

While this should go without saying, listen to what your customer is telling you first, then seek ways to make amends.

Some customers don’t even want anything fixed, they just want to tell you what happened.

Follow Covey’s 5th Habit: “Diagnose before you prescribe.”

Tip #8 | Honesty and transparency go a long way.

According to a study by Cohn & Wolfe, these are the top three things people want in big brands:

  • Communicating honestly about products and services.
  • Not letting customers down
  • Acting with integrity at all times

Johnson & Johnson received so much praise from the public because they were honest and they acted with integrity to do the right thing.

Tip #9 | Learn from your mistakes.

Don’t make the same mistake twice. While PR disasters are bound to happen, it’s the way that you handle it and grow from it that matters.

Companies that provide the best customer service devote lots of resources towards it, and it pays off.

In fact, according to Bain & Company, increasing customer retention rates by just 5% can increase profits by up to 95%.

As Orlando Battista once said, “An error doesn’t become a mistake until you refuse to correct it.”

Customers are a business’s greatest asset, so it’s in your best interest to take good care of them.

For more information and statistics about customer experience, click here.

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Posted in Best Practice, Marketing, PR