INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The foundational objective of any good sole proprietor is usually to dispose off his goods as much as possible. At the back of his mind, he will most readily place his customer’s satisfaction at his uppermost mind. Customer satisfaction is the pivot on which all activities revolve, be it in production or in marketing. The market is a global geographical entity of its own where the customer is a king.

In this respect one therefore cannot expect the company to turn the other cheek in the face of persistent and damaging stand by a customer.

Basically service oriented companies do not have any tangible goods to their complaints although it is expected that complaints by a customer is not meant to tarnish the image of the producers, but to improve on their services.

To a good producer, these complaints are supposed to guide him in planning of his product by way of determining what his customers actually want and to the quantities they can afford to acquire. Customers, who feel they have not been treated well, may make public this development to the detriment of the affected company. Therefore in this regard, a good producer should move quickly before more harm is done. By and large, a customer is a shareholder by virtues of his patronage. It is noble to treat with equity. And equally good to say that appropriate pricing may be an outcome of a customer’s complaint. The prices to which the best service is offered could really affect its demand. If best decisions are taken in that line, the producer is likely to triumph over his competitors. Marketing concepts which involve letting the people know of the product and sending the products to where it is actually needed, will create no less impact. A good mix of product, price, place, and planning will give a fantastic reap-off.

Most observers agree that competition in the industrial world is becoming increasingly intense. More and more companies worldwide are searching for ways to build suitable advantage to counter this threat. As costs rises, as productivity stagnates and service quality deteriorate, more service firms need to take interest in marketing. More pressure is now on service firms to increase productivity, since the service business is highly labour intensive. Cost is rather on the rapid increase. To this end, it is not enough just to make workers work harder, more training will provide the needed skill geared towards customer satisfaction. The quality of service may be improved by reducing quantity and vice versa, and finally

increase in equipment numerically has a lot to do with improvement in service rendered. In a nutshell, customer service should be of prime importance to service oriented companies, which could be improved upon by taking customer complaints very seriously and acting in the direction that will bring better satisfaction to the customers. If the service oriented company does take the decision to handle complaints properly, it may find itself in the happy position of receiving a bonus in the shape of an information feedback which may, in the long term, save the company money, avoid law suits, and to build up an even better relationship with the customer.

The efficient customer relations officer does not only solve problems for the customer by using information gleaned from the complaints received but he also discovers many instance where action can be taken to ensure that such complaints are not received in future. And, bearing in mind that for every consumer who registers his displeasure in the most telling fashion of all-by taking his needs elsewhere- this could hardly assist in maintaining the company’s profit- or, on accessions, improving them. Management like any other body of people, is fallible. Sometimes managers make mistakes of their own, or sometimes they fail to spot those made by people. In either case, the result could manifestly make the company loose its customers or even take the company image tarnishing and elongated legal suit. At this juncture, it is important to note that companies should then develop customer services that are customer driven and also effective against competitors. The company has to decide the most important services to offer, the level at which services should be provided and the form of each service. The service-mix can be coordinated by a customer-service department that handles complaints and adjustments, credit maintenance, technical service and customer information. Marketers need to know more about marketing service products.

Though service industries have always lagged behind in the use of marketing concepts, there are compelling needs for a change in attitude, alternatively expressed services can be classified into people or equipment base. A good example in this regard is a lawyer, or an accounting consultant, a motor mechanic or an aircraft used in conveying passengers. While the former are based the latter is equipped based. Sometimes it may require the presence of the clientele or not. For instance a doctor needs the presence of the patient for him to do his work. The motive for providing such services may differ. Private and Government hospitals provide close to the same services but while the private hospital wants to maximize profit, the Government hospital wants to maximize services to the patient. Services are activities or benefits that one party offers essentially as intangible product to the other and do not result in the ownership of anything. Services are not only intangibles; they are also inseparable variable and perishable. Two main types of services can be identified viz:-

MATERIALS SERVICE: – Which consists of the actual product of service, which you are selling. It is all about getting the product right. PERSONAL SERVICE: – This is the way in which the material service is delivered. It is about the interaction between your employees and your customers. It is probably the most visible part of the operation and often the part on which a company is adjudged “good or bad”. Personal service is the focus of this research work.

In whatever way they are looked at, all are service oriented. Admittedly, customer complaints must be geared towards maximum satisfaction and should be treated as such. However, the pill given in one case may not be the same with another and the dosage in one may differ from another.

Customer’s complaints should not be a threat rather it should be viewed on a positive side as an instrument of change that will improve the condition of the firm industry and the economy generally.

1.2 STATEMENT OF THE PROBLEM

From the foregoing, the impact of customer’s complaints on the marketing of services is un-quantifiable. However, the neglect of this all important aspect of marketing, due to slack in the general performance in the industry, has caused untold problems to service firms, the industry in particular and the economy in general.

A very satisfied customer might tell one or two people how pleased he or she is, but research has shown that the unsatisfied one is likely to tell an average ten other people about the bad experience. In fairness to customers, they have rarely set out to spread a gospel decrying the motivation of business concerns, preferring to see themselves as ginger groups encouraging companies and corporations to set up their efforts to provide higher standards in the goods and services they purvey. And, similarly the best of the international corporations have grown up on the principle that the customer is and always has been right.

However to some extent the service industry has cause for complaint. The media, for instance, might be said to have devoted a disproportionate amount of space and airtime to consumer complaints in recent years. Unfortunately, such complaints are seldom handled by people with any sharp business acumen or any better motives than the search for a good story.

However, the failure of the service industry came up as a result of the following reasons: –

1. Conceptual failure: – Unless an entire workforce of a service industry from the chairman downwards is prepared to accept the marketing approach and consequently to give the satisfaction of its customers the highest corporate priority. It is virtually impossible for staff further down the line to implement marketing programmes. One often hear the complaint from junior marketing executives that, though they want to get it right the boss simply doesn’t understand or want to know. 2. Organisational failure: – As a result of the failing just mentioned, there are too many companies that do not possess the organisational structure to deal with consumer affairs or consumer complaints. Even when such a structure does exist the staffs employed are frequently too junior for the responsibility involved, and additionally have not received sufficient training and motivation.

In a closely related development, a very satisfied consumer might tell one or two people how pleased he or she is, but research has shown that an unsatisfied one is likely to tell one average ten other people about the bad experience. The service industry has lagged behind in marketing of their products. This has paved way for serious economic outstanding issues among which are, dissatisfaction of customers needs and expectation that leads to customer sourcing for alternatives where practicable. This results to loss of customer, loss of revenue and reliance on government subvention where available. Low level of capacity fertilization results, fixed costs rises and retrenchments follow. The few ones that is able to survive maintained monopoly advantage to the detriment of the consumers in particular and economy in General what follows is the Government avocation of privatization of such ‘key’ but inefficient Service industries. Most Nigerian entrepreneurs in the service industries are very unserious. Apart from keeping low customer relationship, they were never at the seat of their business. They will be globetrotting. One wander what business has he/she in Germany/Tokyo etc. when his customers are here unsatisfied? With public enterprise, authorities that should receive and act swiftly on complaints are not easily accessible. Customers who have been humiliated by the desk attendants leave with great disappointment. Most of the displayed “Complaint Boxes” have performed no serious function than “Pour your complaints or observation in the hole and get out of the premises”. No one answers your letter. How does one (a customer) explain the following vices?

a. You arrive at the door and it is locked (complete closure for break even through they are offering essential services) you enter and there is nobody there. Or there is somebody there, but with there back.

b. NEPA – NITEL Water Board: There is somebody there but he or she walks off as you approach government house and offices.

c. There is somebody there but they are interested in each other not you.

d. Old Generation Bank and Government Offices: There is a

large queue and only one person is serving while. Lots of others are walking about.

1.3 OBJECTIVES OF THE STUDY

There is therefore every need to pay attention to consumers’ complaints by manufacturers and some oriented corporate entities. The inefficient handling of consumer complaints is saddening; it appears that few companies provide easy access in cases of dissatisfaction by the consumers. It is understandable that firms are frequently on defensive in their dealing with customers, offer only vague assurances, delay or fail to reply or to commit them to do anything positive at the right management level. Few firms have as yet considered the merit of having a hot line for consumers, with readily accepted reversed charges.

Today customers’ expectations are higher than ever before. In every organization there are bound to be times when things do not turn out as expected in-fact things may go completely wrong. It is a universal truism that cooperate lost of customer-ship is a resultant effect of ineffective or rather ineptitude of organizational quick response to customer complaints.

The main purposes of this study therefore are:

(i) To establish how private and public enterprise in

Nigeria have faired or failed in handling consumer complaints.

(ii) The impact on their marketing performance that

is, to evaluate the problems created by ineffective handling of customer complaints.

(iii) To understudy the nature of these complaints and how it effects the economy and the consumers.

(iv) A comparative analysis covering private

enterprises, one-man business, corporate organization and public enterprises will be done.

Solution to the problems at hand will be sought and methods of overcoming any possible shortcoming that is expected to arise due to its implementation will be given a reasonable solution. Recommendation on a lasting solution to the problem which if implemented will go a long way to solve this menace will be propounded. All these will be done in line with the Nigerian environment that constitutes the main area of study. If implemented, the customer’s entrepreneurs and the government would be happy.

1.4  HYPOTHESES

Being guided by the main purpose of this research and the need for a thorough investigation into the subject matter, it is therefore reasonable to propose as follows:

Ho Customer complaints have been given the required attention in service oriented companies, whether private or public.

HA Customer’s complaints have been given the required attention in service-oriented companies, whether private or public.

Ho Customer’s complaints if not properly handled, could be a way of hampering the economic performance of the industry, hence the Nigerian economy.

HA Customer complaints if properly handled could be a way of improving the economic performance of the service industry, hence the Nigerian economy.

Ho Customer complaints handling are not similar in both the private and the public service companies.

HA Customer complaints handling are similar in both the private and the public service companies.

1.5 SIGNIFICANCE OF THE STUDY.

This work is designed to be of immense benefit to the various classes of entrepreneurs and the people in the society. It will be a most needed research in the field of marketing especially on the area of customer relations.

Producers of services will need it to know how to handle customer’s complaints and satisfy them. The government may need it to make rules that would guide industries in minimum expectations by the governed shareholders, and other interested parties will need it as to advise managers of their hard-earned investments.

Employees will find it as an invaluable asset because it will be handy for effective study of customer’s complaints and attitudes expected of them.

Management efforts will be futile if the people served are not satisfied.

1.6 SCOPE OF THE STUDY

The intention of this project is to determine the effort of the customer complaints and complaints handling and the performance of service companies. To this end, various marketing strategies adopted in the service industry will be reviewed in various classes of complaints laid by customers and their expectations will be discussed. Methods of handling these complaints to ensure satisfaction will be looked into. However, this study has no plan to go into any quantitative approach of measuring customer satisfaction and customer value determination except on data analysis collected for this research work. Only Nigerian cases will be cited because the study environment is purely Nigerian except where expedient for review of related literature.