Embrace complaining customers to bolster your brand?

SAN FRANCISCO--Could your customer complaint department become a profit center?

That general idea is now possible with the era of corporate blogging and Web 2.0 upon us, according to a number of marketing gurus at a panel discussion Tuesday at the Ad:Tech conference here.

Earning loyalty by winning over critics is nothing new for marketing and customer support experts. What is new these days is that the increasingly interactive Internet provides a way to directly engage with them--once companies understand it's possible.

"There is a real gap in organizations between the group that handles the complaint department and those who view this as an exciting communication touch point," said Beth Thomas-Kim, Nestle's director of consumer services. To show how to do it right, she pointed specifically to the example of online retailer Zappos.com.

"The CEO views the contact center as an investment opportunity," Thomas-Kim said. "Often companies are squeezing the life out of it...but he's using it as a way to drive the connection with the consumer."

There was a time when gripers had little recourse besides cranky letters to consumer advocates. Now with the Internet capable of amplifying their voices and helping them band together, they and the problems they are finding with products and services can't be safely ignored.

Providing them a forum for discussion on the corporate Web site can help companies respond directly--and avoid the likelihood that their opinions about the company will help elevate some other Web site in search results.

"By being proactive on the Web, sites like Sony Sucks and IHateSony don't rank as high as they used to," said Rick Clancy, senior vice president of corporate communications and now and now a corporate blogger for Sony Electronics.

A good case in point: Sony's massive laptop recall triggered by lithium-ion battery problems. "It would have been good to have the blog then to have a way to communicate in an unfiltered manner," to explain what happened, what the company is doing about it, and to steer people toward the support they need, Clancy said.

A more concrete example: Sony eliminated a $50 fee that it had charged for PCs that weren't loaded up with trial software often called "crapware."

In a March blog post, Clancy wrote, "The fee was designed to cover costs associated with removing the programs from the PCs, as well as the loss of subsidies received from the third-party providers. Regardless of the intentions, we listened and eliminated the fee earlier this week. It's gone."

Direct communications--both soliciting feedback and telling customers about new developments--have become a high-profile element of Dell's attempt to reverse its financial fortunes, too.

"Brands are less afraid to say they're sorry in public," said Jordan Warren, president of Agency.com. And at this point, there's nothing to lose from acknowledging problems: "If you don't, others will," he said.

It's tough to bring the lawyers around to this kind of openness. "To apologize to consumers was a big legal risk for us even a few years ago," said Tom Asher, head of customer relations for Levi-Strauss.

And there's a strong financial incentive to work with those who call the customer complaint lines. Levi-Strauss has found that most folks who buy Levi's and Docker's brands spend about $90 per year on them, but those who complain to the company's call center spend $285 a year, Asher said.

Legal department reluctance to customer communications has been diminishing once lawyers realized that addressing customer concerns on the Internet directly was the lesser of two evils, Clancy said.

"The lawyers are starting to come around. Three years ago they were very resistant. There were a lot of barriers, skepticism, and concerns," Clancy said. "It's happening regardless of whether we participate, and without us participating it's happening in a way that's doing more harm than good. That was becoming more and more apparent."