Well, maybe not a no-brainer in the customer service carnival of telecommunications churn, which apparently costs $10 billion per year, according to CGI–so much, it’s developed a “Churn Management” program. That’s where “Customer Justice”–that is Customer Service from a macroeconomic point of view–comes in. When things get so bad that you need “churn management,” it becomes a matter of justice.

Going on 30 years now, I have taken an interest in Customer Justice because it’s one of the greatest marketing levers that far too many businesses fail to value. It’s actually a comparative advantage in international trade and will be a major factor as services continue to be globally outsourced.

“But, look–it gets a whole department in our org chart,” I’m told. Yes, but it’s rarely a rung in the corporate ladder’s fast track or among the required classes in business school. It seems too simple to warrant being considered a “discipline,” like the more sexy Finance or Business Development. And Stanford or Wharton grads don’t ”study” Customer Service–it’s too vocational.

Of course, one Harvard Business School grad, Fred Reichheld, did. In 1989 he pioneered Loyalty Marketing at Bain and developed the statistic that the cost of acquiring new customers was five times the cost of servicing established ones. First widely published in 1996’s The Loyalty Effect: The Hidden Force Behind Growth, Profits and Lasting Value, it’s quoted every recession when customers get hard to find. In fact, it’s been elevated to a mantra so often that it rarely includes a citation, and it’s now been inflation-adjusted to six or seven times depending on who’s doing the chanting.

But many businesses don’t believe it. They think customer service boils down to how well you write your call script and how many calls need to be escalated to Supervisor “Bill,” part of the staff of our former telecommunications vendor who was unwilling to provide me with his last name, even though he had all my information. I told Bill that if that Early Termination Fee did in fact appear on our final bill, I’d have to recoup our losses by developing this incident into a case study.

We have a lot of great vendors — how would they have treated this? Why do telecommunications and financial services come up in churn discussions more than, say, manufacturing? (Regulation, anyone?) How often is churn associated with this particular vendor, who, out of fairness, shall remain nameless pending that final bill? If, however, that bill reflects Bill’s heightened emotional state during our call, then this will be a matter for Customer Justice, and I can share with you what I learn. After all, if you have to pay a fee, you should get something in return, don’t you think?

When I bought my first pair of hiking boots in the ‘70s, I learned to be a loyal consumer. When that first pair of Vasque boots died, I didn’t even do any research. There was nothing to research: Vasque was what I had, Vasque was what I wanted, Vasque was what I bought. After the second pair, my preferred model was discontinued, so I simply switched to another model – still by Vasque – without every questioning why my favorite model had been discontinued.

Enter middle age, severely damaged feet, and a podiatrist who recommends very weird (and expensive!) shoes called MBT’s (Masai Barefoot Technologies) that have curved soles shaped like the bottom of a rocking chair.

With two pair of MBT shoes (walkers and sandals) purchased, I’m already in for about $500, so I consider myself a good customer. After recently hiking a moderately rocky trail in the walkers, trying not to twist my ankle, I decided I was ready to consider a third pair: the MBT Kilima hiking boot with extra ankle stability. I had looked at them (lusted for them, actually) online just a few months ago, and after finishing my taxes last night finally made up my mind.  After decades of wearing the same brand of hiking boots, I’m ready and willing to consider plopping down a couple of hundred from  my tax return for yet another pair of hiking boots, as the MBT rocker design really does prevent a lot of pain and allows me to walk further (and gives me a better workout at the same time).

MBT Kilima Hiking Boot (Discontinued)

So, what do I find? They quit making them, and no one has them in my size any longer.

MBT Moto-GTX

And here is where I realize how my habits have changed. I simply assume there is a corporate blog where I can find a discussion of changes to their lineup, ask a question about what the replacement for the Kilima is or will be, discuss what I liked about the Kilima and what I don’t like about the only other ankle-high boot in their lineup. So I google “MBT blog.”

Unfortunately for MBT, I most definitely did not get a hit for a corporate blog; I got a blog about MBT’s by a podiatrist whose opinion of them is the exact opposite of Dr. A’s: “Typically when someone comes into the office wearing MBT’s, I work with them to transition out of the MBT’s into a more normal type of shoe and I have never recommended MBT’s as a first line of treatment.”

This can’t be good for MBT, though it might be great for my budget. For now I’ll split the difference and pack the painkillers along when I do ankle-twisting trails in my old hiking boots, and keep the MBT’s I have for walks on solid pavement.

But I don’t give up easily on my internet searching tonight; I keep going to try to find MBT in the social media world. Twitter maybe? No luck. There is a #MBT hashtag, but barely used and having nothing to do with MBT shoes. There are a handful of tweets about MBT shoes, but the company isn’t engaged.  Maybe Facebook? For a minute I think I’ve found them: an MBT page complete with the MBT logo. I sign up as a fan and start to post my question, but something makes me check the “info” tab. It turns out this is not MBT the manufacturer; just a shoe store that sells MBTs … and Naots, and New Balance and other pricey shoes I know they would be happy to have me consider.

An hour ago I was a huge fan of MBT’s, and later I probably will be again. Right now, though, I’m a frustrated consumer, caught between the opinions of two podiatrists, and MBT doesn’t even seem to be trying to engage me in conversation. And that’s the difference between 1972 and 2009. I never would have expected Vasque to engage me in conversation in 1972 (or ‘84 or even ‘96): that was the responsibility of the retail store where I shopped. But in 2009 I do expect easy access to a company making such a specialized, expensive product. And if I can be retrained to think this way, what do you think the expectations are of the thoroughly digital generations?

Lastly, I also expect MBT to be listening – and not just to an email I might send if I can find their email address, or some web form I might complete. I expcet them to be listensing here and now, where I’m speaking; on Twitter, where their product is being discussed by fans who have discovered a favorite celebrity wearing MBT’s; on Facebook, where their retailers are making an effort, but are happy to sell you something else as well.

If MBT wants to be smart about social media, they will not only join the online conversation – and soon – but they will use a listening platform like ReputationConnect to keep up with what their customers are saying.

1) The ability of your product or service to address a need
2) Trust in your company
3) Price

Without trust in your company, anything else about your products and services doesn’t matter. Without trust in your company, a dissatisfied customer will communicate her unhappy experience to others. The 2009 Edelman Trust Barometer describes a radical shift in consumers’ trust in businesses. These findings from Edelman give one pause: “Among our global audience of 25-to-64-year-olds, being able to trust a company is one of the most important factors in determining a company’s reputation. In the past year, 91% of 25-to-64-year-olds around the world indicated they bought a product or service from a company they trusted, and 77% refused to buy a product or service from a distrusted company.”

Today consumers leave comments on forums, blogs and mainstream media websites to tell others about their experiences with your company. Interestingly, Edelman reports more 25-to-64-year-olds leave positive online comments about companies, vs. negative comments (42% vs. 34%). All customers (whether they are satisfied or dissatisfied) need to be appreciated for their unique insights. The key is to not wait for customers to come to you. You have to seek them out and include them in the development of your products and services.

Many companies don’t know how to engage with customers. Conversations about products and services are ongoing and companies need to tap into these customer conversations to not only discover what’s being said, but to also address customers’ needs. If someone is unhappy that you don’t sell a blue widget, then you need to find out why they want a blue widget, and if it is in your company’s ability to provide this product. The main point is to actively and genuinely desire customer contact, and to join these conversations where customers gather online. NSI Partners’ ReputationConnect reputation monitoring service can help companies assess their online reputations and develop customer engagement strategies. Edelman offers this call to action for 2009: “Business has had the benefit of the doubt for 25 years. It must now re-earn the mantle of authority by restoring the confidence that has been so widely lost.” Companies that answer this call can simultaneously gain a competitive edge and increase customer satisfaction.

NSI invites you to find out more about ReputationConnect. Get started today. Your customers are waiting for you to win their trust.

What happens when the unthinkable occurs? Delta Air Lines and Dell Computers are two companies that have experienced the wrath of indignant customers armed with advanced publishing platforms. Another company is the Kryptonite Bike Lock Company, which in September 2004 learned that some of their locks could be picked with simple Bic pens. (While early reporting alleged that Kryptonite only learned of the blog-based buzz when the New York Times posted a story, Donna Tocci, Public Relations Manager for Kryptonite, more recently told Dave Taylor that the company had been “aware of the Internet involvement with this issue from the first day. This included blogs and forums.”)

Kryptonite had to deal with the situation fast — and their response should serve as a primer on outstanding customer service and company reputation-management. The crisis was two-fold for Kryptonite: They needed to 1) replace malfunctioning products while 2) quelling rumors that their company was unresponsive to consumer needs.

According to Tocci, Kryptonite did everything they could to ensure that their corporate response to the Bic pen unlock episode was rapid and global in scope. Timing and execution allowed the company to distribute over 380,000 replacement locks to customers worldwide. Tocci said that Kryptonite quickly set up a synergy among distributors, retailers, factories, shippers and fulfillment houses to ensure that customers were able to get replacement locks within weeks of the first mention of a problem in an online forum.

Tocci crystalizes the lessons that can be learned from her company’s experience: “They [companies] do need a good crisis management plan no matter who they are or how they choose to implement it.”

The takeaways from this incident transcend blogs and blogging, and offer critical insights into what being a responsive company really means; no matter which medium is used to reach customers.

The Word of Mouth Marketing Association (WOMMA.org) recently reported that Del Monte used customer input from its online pet owner community, I Love My Dog, to help create a new dog treat product. The Wall Street Journal reported the full story that discusses how Del Monte purposely created their 400 member community consisting of hand picked dog owners who could help them with product feedback.

If you’re looking for new ways to dialogue with your customers, consider creating a branded social network site using applications such as KickApps, Ning, or CrowdVine. Some groups use these apps for short-term events such as conferences. Or you can start a brand new social network and ask your customers to help you create your next hit product! Need more information? Download this PDF 9 Steps To A Successful Online Community or view these YouTube videos on CrowdVine’s conference networking and social networking applications.