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Published: October 19, 2012

 
 

How Companies Can Respond to Online Complaints

Tone and context are crucial to effective damage control; the thing to avoid is a heavy impersonal hand.

Title: Online Damage Control: The Effects of Proactive Versus Reactive Webcare Interventions in Consumer-generated and Brand-generated Platforms (Fee or subscription required)

Authors: Guda van Noort and Lotte M. Willemsen (both University of Amsterdam)

Publisher: Journal of Interactive Marketing, vol. 26, no. 3

Date Published: August 2012

In 2010, a prominent European comedian took to Twitter to complain about a mobile phone carrier’s customer service. After receiving an apology, which he deemed inappropriate and overly corporate, he invited others to share their disappointing experiences with the company. Within a week, the number of negative Twitter statements about the carrier soared; the company said it lost between €200,000 and €300,000 (US$255,000 and US$382,000) because of the incident.

In the past, when customers complained about a product or service, their opinions were typically confined to one-on-one conversations with a company representative. But now, with the click of a mouse, one consumer can spread damaging sentiments across blogs, social networks, and message boards to reach a global audience.

Through an in-depth survey of online users, this study found that companies can repair their brands’ reputations by having spokespeople engage with dissatisfied consumers online, especially with those who explicitly request a response. But damage-control efforts can be ineffectual when companies try to preempt critical views in online contexts designed for consumers. In those cases, a company’s efforts are typically seen as intrusive and pushy.

This paper aimed to fill a void in research about online marketing. Many Internet-based businesses, including Amazon, Epinions.com, and Tripadvisor.com, offer services that allow companies to respond, either overtly or discreetly, to unfavorable opinions posted on their sites, the authors note. But a 2011 study found that the majority of companies are hesitant to use these services because of a lack of evidence that responding to consumers will help restore their reputation. In fact, little research has been done on the topic.

To explore this type of reputational impact, the authors asked 163 participants to evaluate a blog post that appeared in online forums, about a recall announcement from an automaker. The blog post was followed by a negative comment from a customer. The customer stressed how disappointed he was with the recall process. He stated that he had lost all confidence in the brand, and vowed not to buy his next car from the company.

Participants in a control group saw no follow-up message from the company, but the rest of the participants read one of two streams of posts from the automaker’s spokesperson. The first stream was reactive; the spokesperson responded to the blog post only after a consumer asked for a response. The reactive replies began with the spokesperson thanking the customer for his question. In the second, proactive stream, the spokesperson made an unsolicited attempt to redress grievances. These responses led off with the spokesperson saying that the company searches the Internet for questions, suggestions, and complaints from customers. In both the reactive and proactive streams, the spokesperson then continued with the same explanation of the recall procedure.

The announcement and posts, all of which were copied from real blogs, were embedded in either a consumer- or brand-controlled site. (According to a 2011 report, 30 percent of consumer complaints appear in brand-sponsored forums and 70 percent on consumer-operated forums.) After reading the material, the participants answered a series of questions to evaluate the brand and the company’s responses.

The analysis showed that consumers evaluated the brand more favorably when the spokesperson responded — whether in a reactive or proactive fashion — than when the company remained silent. But the study also showed that the effectiveness of a company’s interactions depended on the context of the complaint and whether the response was reactive or proactive.

Direct responses to requests, on both consumer- and brand-controlled sites, were generally deemed to be effective. “By responding to NWOM [negative word of mouth] when it is explicitly asked to do so by the customer, a company apparently signals a willingness to engage in conversational communication in a natural way,” the authors write.

But in a context designed for consumers and their conversations — such as an individual’s Twitter account, Facebook page, or blog — a company’s proactive approach was seen as intrusive and inappropriate, which “dehumanizes the nature of its communications,” the researchers say.

Thus, although engaging with disgruntled consumers online can be beneficial, proactive interventions taking place in consumer-controlled mediums are less effective than on company-run sites, the authors caution. “Instead of trying to respond to all NWOM, companies should save their efforts and respond only when the platform is likely to engender positive context effects,” they write.

The authors also suggest that companies take care to strike an appropriate tone. For example, personalizing the interactions can be helpful, by having the spokespeople use their names in online interactions. When companies — in an effort to underscore the seriousness of their commitment to customer service — insist that their representatives use only official titles, they may wind up putting people off.

“As companies’ responses to complaints are now observed by many other consumers than the complainant in the online environment, it is…important for companies to determine [not only] how to respond, but also when to respond,” the authors conclude.

Bottom Line:
At a time when people can quickly spread negative opinions about a brand online, companies can help restore their reputation by interacting via the Web with disgruntled consumers, especially those who explicitly request a response. But preemptively reaching out through platforms intended for consumers and their conversations can be ineffective, making it essential for companies to plan their Internet responses carefully.

 
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