Using Customer Complaints to Your Advantage Negative feedback can help you build better customer relationships and a stronger business.

Guess what? Whenever a customer hands you a complaint, he'salso handing you an opportunity to create a stronger and moreprofitable relationship with him. That's because complaintsthat are handled properly can be converted into increased loyalty,add-on business and golden referrals for you.

Let's face it-problems do exist, and we humans learn morefrom our mistakes than our successes. More than one of my customershave had gripes or suggestions related to my company. Initially, myorganization wasn't ready to hear the feedback. But over theyears, listening to customers has helped me to shape our servicesso they're easier, better and faster to use.

Save yourself the price of an expensive marketing consultant andput the power of your customers' advice to work. Here's howto encourage them to communicate their comments, feedback andcomplaints directly to you:

1. At the point of purchase, be it online, in line at the cashregister or in direct-mail pieces, provide:

• Comment forms with a toll-free number.
• An e-mail link to you personally. Forget about your customerservice department for a moment. The idea is to make sure each andevery complaint goes directly to you. Let's face it: Whenyou've got a complaint, whose desk do you want your feedback toland on?

2. Answer each and every complaint or suggestion. You can use asimple autoresponder if you like, but I advise against that.Instead, put your personal signature on each response.

3. Acknowledge the comment and tell the customer what you'vedone or are doing about it.

4. Create a customer user group and pay attention to what theytell you. A long-standing customer of mine in the semiconductormanufacturing business surveyed customers to solicit feedback onexisting products for enhancement. Surprisingly, the companyreceived three different (and very unexpected) product complaints.The design engineers quickly went to work. The resultingnext-generation products drove enough high-margin, add-on salesthat their stock price skyrocketed from $4 to $44 dollars pershare.

The golden rule is this: When customers give you their valuablefeedback, make sure they're perked in some special way.Consider a handwritten thank-you note, a free gift or a uniquediscount. Be sure to tell them that their input is valuable.

Stats show that a happy customer will tell 10 other people oftheir satisfaction. An unhappy customer will tell 20. Furthermore,it's nine times more expensive to get a new customer than it isto sell to an existing customer. And you know as well as I do thatcustomers vote with their feet!

I'd love to your comments and suggestions about anything that bugsyou or is working for you as a result of reading my column. To getadditional information on this important topic, visit PsychoTactics.Also, check the listings on wsRadio.com for my "Entrepreneur Sales& Marketing Show" (live each Friday from 9 to 10 a.m. PT),which offers information on this and other topics.

To get more of Tony's great sales tips, check out hisnewest book, Stop Cold Calling Forever: True Confesssions of aReformed Serial Cold-Caller.