Illustration by Richard Mia
Getting it wrong to get it right
Many years ago, I worked with a client who ran a five-star hotel in an exclusive part of
London. Running a business in that area was highly competitive. Their clients paid top dollar and expected the best.
Although it was a long time ago, I have such vivid memories of this particular client. He was a very charismatic gentleman, always impeccably dressed and he had impeccable standards to match.
A renowned, highly respected figure in the high-end hotel industry, it was a pleasure working with him.
Are they coming back?
One of his key metrics was measuring the percentage of guests who returned. So, to
maximise repeat business, he focused on everything they could do to give the highest quality service and leave the best possible impression - wowing their guests so they wouldn’t want to stay anywhere else.
He did all the things you would expect from a top hotel: making sure the team was attentive and phones were answered quickly, delivering room service in good time, ensuring the staff were polite and well-presented, and so on.
An unexpected outcome
While measuring the results, the hotelier began to notice a strange trend. When something had gone wrong during the guest’s stay, for example a missing bathrobe or remote control, if the hotel went above and beyond what was expected to make things right, then those guests were more likely to return than if something hadn’t gone wrong in the first place.
The hotelier found this discovery weird; counterintuitive, in fact.
It’s ‘a thing’
When my client, somewhat bemused, raised this strange phenomenon with me, I explained that his guests’ behaviour wasn’t actually that strange. In fact, it reinforced an established theory that I was delighted to introduce him to.
Called the 'Service Recovery Paradox’, it’s a term that was first coined in 1992 by
researchers, McCollough and Bharadwaj. It describes how customers’ post-failure
satisfaction can actually exceed pre-failure satisfaction.
Effective service recovery can not only retain customer satisfaction but also actually elevate it to a higher level, leading to long-term customer loyalty.
Even better than before
A good example of service recovery at its finest is if a traveller’s flight is cancelled.
Obviously, an airline wouldn’t deliberately engineer that circumstance to capitalise on the Service Recovery Paradox.
However, the outcome is still the same - if the customer calls the airline to complain about the inconvenience they’ve suffered, and if the airline books them on an alternative flight of their choice, on the same day, and gives them a voucher towards a future flight, they are now happier with the airline, and feel more loyal to it, than if their flight hadn’t been cancelled in the first place.
An intriguing experiment
I encouraged my client to put this theory to the test, confident that it would be a successful strategy to further boost their percentage of returning guests.
Although he was happy to experiment with the service recovery concept, he was also
cautious. So, over the following months, he started playing around with various scenarios. For example, on one occasion he got his staff to deliberately remove the remote control from a suite so, when the guest arrived, they would call housekeeping.
To make amends, the hotel arranged for a chauffeur-driven car to take the guests to and from the theatre they'd booked through the concierge.
Naturally, the guests were super-delighted with the hotel going above and beyond to
appease the situation. Their loyalty was firmly cemented and they went on to return to his hotel over and over again.
Furthermore, they loved sharing their wonderful experience with their friends who, in turn, booked rooms there, impressed with their friend’s glowing endorsement of the hotel’s exemplary service.
Who knew!
The hotelier continued these experiments over a year or so, building his confidence as he saw the excellent results in customer satisfaction.
I urged him to fully embrace this strategy and I helped him to create a formal policy that became part of the hotel’s standard procedures.
We implemented staff training, making sure they understood that, when things go wrong, they should do more than apologise and put it right.
The hotelier gradually introduced a budget for housekeeping, which staff could allocate for this purpose, empowering them with the authority to use their best judgement in the moment.
The results were undeniable: the hotel developed the highest occupancy rates in the area, with a loyal following of returning guests who chose to stay at his hotel year after year.
So learning to increase customer loyalty by doing more than is expected to put something right, and even to contrive a situation that gives them the opportunity to do so, was a valuable experience for my client that reaped bountiful rewards.
How about you?
Can you think of a way to try this strategy in your business, cultivating more loyalty, repeat business and positive word of mouth from your customers? Let me know!
And, if you would like to have a conversation about how we can work together to get you and your business where you want to go, I'd love to hear from you.
Just fill in your details on the Contact page and we'll take it from there.
Comments