Customer complaints are inevitable at any business dealing with members of the public. Despite the best of efforts to keep everything running smoothly and everybody happy, it’s impossible to be perfect and satisfy all clients all of the time. However, when there are complaints it’s vital to business success and reputation that they’re dealt with effectively.

After new stats released by Ofcom revealed damning evidence that companies are failing to handle complaints, customer engagement specialist The Grass Roots Group has warned UK SMEs to make vital improvements.

Record complaints were recorded in the finance and telecoms sectors, with around 15,000 complaints made to the Financial Conduct Authority (FCA) every day last year regarding financial services organisations.

And it was found that many of these complaints were not being adequately dealt with in a manner now expected from customers.

Complaining via social media is becoming an increasingly popular option for disgruntled customers, with 65% of people now relying on Twitter to get in touch with companies as opposed to going through a call centre or writing an email. This public shaming can be extremely damaging for businesses – resulting in the loss of customers and the alienation of potential new ones.

Advice for dealing with customer complaints

Vikki Zelkin, Head of Client Services, Promotions and Incentives at The Grass Roots Group, said: “A simple and timely gesture can mean the difference between a customer sticking with you and singing your praises, or shouting about their bad experience all over social media where it will spread like wildfire.

“The first step is to resolve the issue as quickly as possible, following up with a timely and unexpected gift to show that you value your customers, making them think twice about taking their business elsewhere.

“However, it’s not just those who shout the loudest that could be damaging for a business. For every person that does complain, there are 26 who stay silent choosing to show their dissatisfaction by defecting to a competitor. Businesses therefore need to ensure they are not only responding to the vocal minority but the silent majority.”

Figures show that reducing customer defection rates by just 5% can increase profits by up to 95%, while responding with the right gesture increases customer retention rates by 70%.