How to Keep Consumers Happy by Learning from Uber’s Mistakes

Since Uber's founding in 2009, the on-demand transportation leader has become one of the most valuable and popular companies. Uber, which enables over 2 million rides per day and has over 1 million drivers working in cities around the world, knows how important it is to learn and iterate quickly. Even as it aggressively expands globally, satisfied customers outnumber dissatisfied customers by a 5:1 ratio.

What insights can retailers take away based on Uber’s nimble customer satisfaction strategy?

But as all retailers know, popular doesn’t mean perfect. Just as with any business, Uber must sometimes disappoint customers. The most common pain point for someone standing at the curb? Just moments before a pick-up is scheduled to happen, the driver suddenly cancels. Inevitable? Perhaps. But rather than simply accepting this scenario, Uber seized the chance to improve and streamline their services. In response to last-minute cancellations, Uber has built a new level of flexibility into its app-based system. Now it can recover from such an unexpected disruption quickly and, as far as the customer is concerned, seamlessly. So what insights can retailers take away based on Uber’s nimble customer satisfaction strategy – one that keeps riders happy and gets them to the destination on time?

Lesson One: Be upfront about the error

Nobody’s perfect. ‘Fessing up to a mistake or a problem won’t cripple a retailer – but denying or refusing to acknowledge an issue might. Just as dangerous: when a company doesn’t even realize a problem exists or hasn’t grasped the full extent of an issue.In Uber’s case, it doesn’t hide the fact that sometimes a driver bails on a ride. Instead, it lets customers know instantly. Almost as instantly, it alerts them that a replacement driver will be along promptly. By communicating upfront about both bad news and good, Uber keeps its customer relationships strong.

Even the most dissatisfied consumers feel reassured when they know their feedback has been heard and it matters.

By the same token, retailers that acknowledge issues are likely to build, not break, customer loyalty. After all, we’re naturally a risk-averse species, and we’d rather avoid a loss than chance a gain. Retailers can leverage this psychological insight by proactively informing customers about problems like shipping delays and product recalls, thereby protecting consumers from perceived loss. Another consideration: when a company makes it a priority to fully understand systemic or recurring problems, it’s better able to identify and address customer satisfaction concerns. That means a retailer is positioned to set – and, of course, meet – a higher bar for consumer expectations.

Lesson Two: Don’t leave the customer hanging

Acknowledging issues can ease frustration, but then what? Even the most loyal customers have limited tolerance for uncertainty in the middle of a problem. Uber is as vulnerable as the next company to negative reviews, but the way it instantly (and essentially, invisibly) responds to last-minute driver cancellations means five-star ratings keep rolling in. Since another driver is dispatched right after another cancels, passengers know that action is being taken (often behind the scenes) and aren’t left in the dark.

By communicating up front about both bad news and good, Uber keeps its customer relationships strong.

Retailers have a similar opportunity to earn rave reviews, even when problems arise. For instance, if a package leaves the warehouse later than expected, a savvy retailer can proactively use expedited shipping to match (or even exceed) the customer's expectations. Similarly, if a package is damaged in-transit, send a replacement so that the customer doesn’t have to go through the entire ordeal of re-ordering that item. And most importantly, communicate what’s happening at every step of the way.

Lesson Three: Recommit to making things better

Pleasing an unhappy customer isn’t easy, but it sure is worth it. For its part, Uber scours its consumer feedback data to identify recurring problems and then leverages such insights to improve service overall. Interacting with Uber’s customer service department is quick and efficient.Retailers, too, can benefit from making a loud, clear commitment to righting customer wrongs. For example, a company can internally prioritize customer service training, proactive ticketing and improved service levels to address ongoing or frequent pain points. Here’s something else to remember: when a retailer asks for customer feedback, the onus is on the company to listen carefully and respond accordingly. Even the most dissatisfied consumers feel reassured when they know their feedback has been heard and it matters.Retailers can certainly reapply Uber’s forthright and proactive approach to customer satisfaction. Those that choose to take ownership, act proactively, and communicate clearly have plenty to gain, too.

Amit Sharma

Amit is the mastermind behind Narvar and its CEO, drawing from 18 years of experience shaping business operations at companies like Apple and Walmart.

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