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B8601 Consumer Behavior Term Paper A Study on Customers From Hell

Instructor: Morris. B. Holbrook

Student: Shih-An Yu

School: Grad. School of Art and Science

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Motivation

With the growth of the service economy, there are high expectations on

boundary-spanners to maintain customer satisfaction. However, the customers today

start to learn more tricks or principles of marketing. The company policies and

marketing campaigns may become more vulnerable if they are flawed and consumers

take advantage of them. Customers are often welcomed, however, there are also some

customers that are not. In some cases, consumers rather believe that only when they

resort to aggressive behaviors, they can be thought important. The corresponding

aggressive or disordered behaviors vary differently according to the situation or needs.

In a diary study of part-time service workers carried out by Grandey in 2002, 43% of

anger-inducing interpersonal events reported over a 2-week period were due to

consumers. In this term paper, I planned to do a study on the behavior of a special

category called “customers from hell” (CFH).

Philip Kotler, one of the most prestigious management guru, placed the topic,

Customer Satisfaction, as the third chapter of his book, Marketing Management,

revealing the importance of dealing with customers’ values and satisfaction is the

central concept of modern marketing. In this term paper, we are not trying to debate

the effectiveness of the consumer-centric marketing. Instead, we want to categorize

unusual disorder of consumer behaviors and try to formulate the mechanism of these

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behaviors. In addition, we also want to find the internal and external for these

behaviors and analyze if some of those behaviors can indeed be rationalized according

to the values we have or ethics we refer today.

Background-Companies

The concept of consumer-oriented marketing has been widespread in today’s business

especially in service products. In the world of customer-coddling congruence, where

every company emphasizes more and more on customer-oriented marketing and has

bought into this kind of ideology, the question becomes, “how can competitive

advantage achieved or sustained”. They provide warranty, guaranteeing, 24-hour

customer support hot line, or all kinds of free gifts or rewarding for purchasing.

Some companies also start to look into their customers’ values that are originally out

of the firms’ interests, for example, Starbucks. One of their mission statement is

“Develop enthusiastically satisfied customers all of the time”. They even have

environmental mission statement, such as “Instilling environmental responsibility as a

corporate value”. This kind of firm policy can potentially spoil the consumer’s

appetite. It even exacerbates the situation when consumers become more aware of the

positions with unequal power in the consumer-company relationship.

Stephen Brown concludes that the paradox of anti-marketing protests is that the

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protesters have taken marketers at their word that the companies are selling their

creed of customer care so well that consumers now expect to be listened to. The

marketers portrayed the firms as customer-centric rather than profit-focused and

having reneged the deal such as employee exploit or environmental despoliation.

Background-Customers

Business has become an important part of people’s daily lives. The virtual market

places, which are based on Internet service provides people more opportunities to

trade and practice their knowledge on marketing. As a consequence, the consumers

today, in many cases, may be sales people in other places. They are trained to be more

aware of the commercial messages behind the marketing campaigns posed on them.

Therefore, research techniques, database, and the software the company use for

marketing is now counter balanced by consumers’ knowledge of marketers and the

marketing system, especially in Internet era where the knowledge in marketing is

generally accessible on-line. An example can also be found in the discussion in the

fatwallet.com user’s forum. The users there collect and compare the marketing

campaigns, and share the portfolio of discount, coupons, rebate or even price

matching to maximize their values. The properties of Internet make the marketing

information easier to access, spread, share, and compare. Therefore consumers

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become more capable and knowledgeable to detect, neutralize, and even take

advantages of the marketing tricks.

Sometimes the consumers can even exploit the knowledge to the firm or

consumer-protection legislations to counter the organization or alter the firm’s

policies toward values that are originally out of the firm’s interests. What is even

worse is that consumers sometimes consider marketing deceptive, especially when the

consumers do not totally agree the ethics referred by the marketers. In Steven Brown’s

book, he addressed that many believes Starbucks is a particularly insidious form of

capitalism; one that pretends it isn’t capitalist. Even its record of good corporate

citizenship has been dismissed as greenwash.

Ronnie Cummins, the director of the U.S. Organic Consumers Association, confessed

openly about his contra-Starbucks campaign. He said “We target them because they’re

the only big company in the world that pretends to be socially responsible…It’s better

to start with them. Kraft is never going to do anything. When you’re the grassroots

with limited resources, you have to pick your targets carefully.”

Some consumers may even think the overwhelming commercial messages are

invasive to their privacy and even financially harmful, especially for electronic

commerce. The low cost of the information technologies lower the entry barrier of

malevolent usage, and some deception may disguise as a marketing campaign, for

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example, spam mails or network fraud such that consumers start to generally perceive

commercial messages negatively. There are also some other issues being more and

more concerned by consumers today such as anti-exploit, anti-capitalism, and

environmental protection. They all start to alter the consumer’s value and therefore

change the firm’s policies or interests in the long run. For example, they are requested

to be more social responsible and to support green, humanity, anti-capitalism,

anti-exploition, and etc.

Customers are not always right

The mantra “The customer is always right” communicates the unequal power in the

customer-employee transaction, which is a key aspect of being a target of work

aggression. However, the problem is not always that front-line people are not “on

board” with the latest thinking about the importance of quality customer care. In fact,

many of them know the customers are valued assets, and the organization depends

upon the customer and not the way around. But they know the admonition “Treat the

customer like a king” can bring to mind the image of a royal head beneath a dripping

guillotine. Any customer can be moody, or tired, that is understandable. But some

customers are just a royal pain. The customers are not always right.

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A study carried out by TARP Incorporation in 1990 showed that 30% of product and

service problems are from the customer side. In a diary study of part-time service

workers carried out by Grandey in 2002, 43% of anger-inducing interpersonal events

reported over a 2-week period were due to customers. More often than not, the

customers who cause their own problems are the loudest, and meanest of all.

Definition of customers from hell (CFH)

In this study, we use two criteria to validate CFH behaviors-- hard bargaining and

work aggression. Hard bargaining here is defined with broad sense. It includes all

forms of abusive behaviors of asking tangible or intangible benefits that are against

the firm’s policy, for example, the freeloading or asking to be treated specially.

Work aggression includes all kinds of verbal, physical, or emotional aggression and

hostility. Generally the research in this area has focused on the members within the

organization. However, a missing piece from the existing literature is the recognition

that such anti-social behaviors may come from the customers. The researchers have

been more likely to study rare violent episodes from ex-employees or the public than

the effects of the more common verbally abusive customers. In fact, aggression from

customers is critical to understand due to the potential frequency and challenge of

responding to aggression from this source. The above two criteria we refer to is based

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on the fact that those behaviors can cause the firm’s profit loss or trigger

psychological stress and corresponding time loss or work force burnout.

In Ron Zemke and Kristin Anderson’s research in 1990, they conducted a series of

focus group interviews with front-line service people in a variety of jobs, and asked

about their most difficult customers. In the conclusion of the study, they synthesized

five profiles of customers from hell with interesting names. They are: Crown of

Creation, Breath of Spring Air, Raid Siren, Pride of the Reich, and Soul of Charity.

The real problems caused by these tough customers are usually not the tough tasks

themselves. Sometimes they cause the firm’s profit loss by the abuse of the customer

care policy, such as return policy. However, in most cases, this kind of loss is limited

when the customers are well educated and with high ethic standard. In some cases, on

the other hand, the problems can be even worse. The stressful situation or even the

aggression they raise can probably cause time loss or even burnout to the service

workers.

Typology

In “Training” magazine, Ron Zemke and Kristin Anderson listed five typological

profiles of customers from hell who are every service worker’s nightmare.

1. Crown of Creation:

This type of customer from hell is egocentric. Usually they put themselves as first

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priority. They will like to walk over the front-line person to get to the people in

charge. They want to be exempt from any policies. They loudly demand that your

organization stop the hurricane so his flight can leave on time.

2. Breath of Spring:

This type of customers from hell cannot control the choice of vocabulary. They

often express their frustrating purchasing experiences or upsets in a “NASTY”

way. Sometimes this behavior can offend people and result in more serious

confliction

3. Air Raid Siren:

This type of customer from hell has a lot of pent-up emotion. And they get

nervous and panic or even lose their temper easily as if they are doing the

rabid-dog impersonation. They probably bet that if they throws a tantrum right on

the showroom floor, you are going to be more apt to give him the moon because

you don’t want the other customers to be disturbed.

4. Pride of the Reich:

Maybe they used to be in this business by a coincidence or know all little tricks

going to be pulled on him. They ask you to follow their orders by all means. They

send ultimatum telling you exactly how to do the jobs. They often want something

that violates a firm company policy or maybe even the law.

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5. Soul of Charity:

This type of customers from hell wants his dollar’s worth, and yours, and mine

and anyone else’s they can get. If the deal is buy-one-get-one-free, they want two

for free. If the offer is buy Jumbo and get a small for free. They want it with a

regular. If it wears out, breaks, or begins to bore, they take it back. They buy fancy

dress gown and go to the company Christmas party and take it back.

No marketing director will argue placing a delighted smile on the face of every

customer. In fact, the only real complaint we can ever hear about the idea of meeting

or exceeding the expectations of every customer comes from the people who actually

are asked to do so. One participant in the original study said that the real horror is that

a truly tough customer is a little bit of each of those types.

Emotional blackmailing

Emotional blackmail is relationship abuse by a desire to hurt. Blackmailing is a

sequence of demands, pressure, and capitulation. Susan Forward said in her book,

"Emotional blackmail is a powerful form of manipulation in which people close to us

threaten, either directly or indirectly, to punish us if we don't do what they want…

Our blackmailers make it nearly impossible to see how they're manipulating us,

because they lay down a thick fog that obscures their actions. We'd fight back if we

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can, but they ensure that we literally can't see what is happening to us." It is an

effective way to overpower those who care about the relationship between the

threatened and the threatening.

People developed certain protective personalities to refuse being affected by emotions.

The examples are listed below.

–Self-doubt–Need to be recognized, Lack of self-confidence

–Wish to maintain calm at all times

–Fear of another’s anger

–Tend to take unnecessary responsibility with another’s lifeThere are six stages of

emotional blackmail in a typical CFH scenario.

1. Demand: Consumers bargain over prices and request for gift, services, or other

intangible benefits.

2. Resistance: Sales representatives cannot or refuse to promise right away or resist

surrendering to the request from consumers.

3. Pressure: Consumers reinforce to convince, for example, providing the offers from

competitors, finding fault with the products or the services, or show them on

compliment remarks.

4. Threat: Consumers may resort to threat the sales representatives during the process

of convincing, for example, threatening to damage the firm’s business reputation,

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requesting to speak to the managers, or threatening to file a lawsuit.

5. Compliance: Sales representatives fail to resist the pressures and threats from the

consumers and surrender to their request.

6. Repetition: Consumers repeat their experiences of overpowering in the process of

relationship manipulation. Or the sales representatives repeat to fail in the similar

scenarios.

Emotional blackmailer may not be always malevolent radically. Most likely they are

those who focus more on their own values. Even though this specific type of abusive

behavior cannot cause physical loss, it can damage the self-integrity by which people

evaluate themselves or distinguish right and wrong.

General model of CFH

CFH behavior can be described as distributive (win-lose), or destructive (lose-lose)

approaches to solve the problem of confliction. The confliction during consuming

process originates from different standards referred by consumers and the

organizations. The standards can have different forms in many different scenarios.

Among those, there are two most important conflictions. The first one is the

perception and the real offer of the products and their corresponding features and

services by the consumers and the firms. The second one is the confliction of the

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ethics referred by the consumers and the organization.

For example, some consumer electronic retailers have price match or similar policies.

But once the consumers try to claim the price match, the managers may give them a

list of limitation and company policies that make successful price match very rare.

Therefore the consumers feel they are betrayed and try to use aggressive approach to

express their disappointment. Another example will be, some companies may provide

an unlimited-time return policy on the basis of trust, but the consumers abuse it such

that they always return after usage. The situation described above is that it is

practically difficult to regulate the ethics by any policy or law as long as it is not

considered a fraud, and the convenience and respect results in firms profit loss.

The model proposed is greatly simplified, and therefore it may lose its completeness.

However, the discussion will only focused on some selected topics from B8601, in

some cases, analogy may also be used to explain the model proposed here in the

following sections.

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Fig.1 Generic model of CFH behavior

The motivation of a CFH behavior, in most cases, is psychogenic, or is defined as

“WANTS”. However, since CFH is not really a complete consumption process, rather

than finding ways to market by manipulating these motives, it makes more sense to

find out the mechanism how the CFH behavior is triggered or reinforced, and find

solutions to avoid it or break the feedback that may amplify the reaction.

Even though CFH itself is defined as irrational or even unrighteous behavior, the

motives are still rationalized by the customers in most cases. They will be discussed

as followings.

1. Confliction in purchasing process: In Fig. 1, there are two major places that can

involve conflictions. The first one is the attitude of front-line service workers or the

salespeople. The other one is the negotiation process. When the salespeople’s attitude

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do not meet the expectation of the consumers, for example, being indifference or less

prompt for the salespeople or over-expected by the consumers. Failures in concluding

a deal in the purchase negotiation process can also cause CFH hazards. One of reason

will be the feeling of inferior or frustration can probably result in psychological stress

and trigger the revenge-based ego-protection behavior.

2. Confliction in the purchase involvement. When the price of the offered products

and the associated services cannot meet consumers’ expectation, CFH can be

triggered in the form of hard bargaining. Price is the most obvious cost that can be

estimated to the customers, and therefore customers may want to achieve the deal

with low price as possible. In some cases where there is no limited availability, the

firm’s representatives can be on the weaker position in the bargaining, customers may

not only seek tangible benefit or price reduction they can obtain from the deal itself

but also pursue the feeling of overpower. Since this defeating feeling is focused

personally on the service workers, they can be greatly stressed since they are on the

weaker position on both aspects of trading and customer-oriented policy. Sometimes

the salespeople may not be allowed to surrender in price by the firm’s policy,

customer may nibble the deal by asking free services or other reward that may reduce

the firm’s profit.

Another reason for potential CFH hazard in purchase involvement is the credibility of

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the salespeople or the organization. The higher the involvement is, the higher the

requirement for the salespeople is. If the customers doubt the salespeople’s profession

or credibility, they can be dictatorial to the salespeople or doubt the products or the

services and raise the potential of CFH hazard.

3. Confliction in ethic standards. Since the widespread of the marketing knowledge

and the high frequency of marketing campaigns, customers are more aware of their

rights in a purchasing process. Roy J. Leweicki mentioned in his book, “people tend

to regard other people’s unsavory behaviors as caused by disposition or personality,

while attributing the causes of their own behavior to factors in the social

environment.” It’s all about the truth. The consumers today do not receive the

commercial messages passively, they can interpret these messages by the knowledge

or theories of marketing they learn from some places, and therefore create their ethic

standard of marketing and consumption. Once the ethic standards of marketing

(consumption) of the organization do not coincide with the marketing (or

consumption) ethic standards of the consumers, the potential of CFH hazard can be

raised. An example is that some researchers also debate the advertisement as creating

or shaping people’s needs, and therefore is malevolent.

4. Influence from the organization. The firm’s policy can also raise the threat of CFH

behavior. If the customer-care policy is flawed, customers can abuse the policy. For

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example, some companies’ return policies can be abused. Some companies market

their customer policy such that the expectation is too high. If the expectation is too

high, customer can sometimes make their request that is against company’s policy or

harmful to the profitability.

6. Values from the consumers, their companies, and the society can also trigger CFH

behavior. For example, some customers enjoys being superior by defeating the

organization, and sometimes customers emulates the CFH behaviors from their

friends or companies. In some cases, customers may rationalize their supporting

attitude of anti-marketing as a social justice.

7. Some personalities themselves can also be the origin of CFH behavior. For example,

being bilious, hysteric just as described in the five typological profiles.

Reactions, Value and Feedback or Reinforcement of CFH

There is rewarding that is a form of source of satisfaction for CFH. It can be divided

into objective value and experiential value. It forms a feedback loop to reinforce the

CFH behavior. Through CFH behavior, customers seek the objective benefits like

price reduction, compensation, gifts, or free services. On the other hand, customers

pursue experiential values according to customer values. For examples, customers

may feel superior if their CFH behaviors indeed prevail. They feel winning faces by

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having salespeople apologize. And they may also feel unique if their CFH behavior

can help them walk over the salespeople toward to the managers. If customers have

successful experience in CFH behavior, it is highly possible that they may repeat it in

the future.

There are some cultural values that can possibly help customers rationalize the CFH.

Most of the time, the values mentioned above cannot be applied properly to CFH

from a normal consumer’s point of view. But for the CFH, they may think themselves

as if they are doing something right or helping others, even though it looks nothing

but showing off to most of the people. We list some of these values and give example

situations in the table.

Table.1 Values referred by CFH Example situation Justice To punish companies with employee exploitation Bravery Aggression a big organization Being respectful To request for special treatment or special offer Being superior, strong To force salespeople to surrender the price Being prudence, efficient Hard bargaining with ethically ambiguous tactics Being knowledgeable Being dictatorial to salespeople or service workers Being persuasive To force salespeople to surrender the price Being considerate, helpful

Hard bargaining for companies or friends

Being of principle Being picky to the service workers Having good tastes To insult the performers to show his superior tastes

Ethics

Consider a possible CFH situation: a customer buys a pair of shoes on sale, and the

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receipt states clearly that no return of final sale. The customer goes home and wears

the shoes around the house and finally decides they do not fit. So he takes the shoes

back to the store. The clerk points out the no-return message on the receipt. But he

does not let it deter him. He starts to yell angrily about the store’s poor quality service

such that all the other customers start to stare. The clerk calls the manager. After some

discussion, the manager agrees to give him his money back. In this case, most of

people may think the customer’s behavior is marginally ethical, or even unethical. But

some people may also argue that it can be considered ethical since there is no

deception involved.

A number of articles in business journals have address the ethical issues surrounding

truth telling. For example, a businessman named Carr argued in a Harvard Business

Review article titled “Is Business Bluffing Ethical?”. He advocates that business

strategy is analogous to the poker strategy. Just as good poker playing often involves

concealing information and bluffing, so do many business transactions. Actually, this

is not just a discussion in business, but is a general question among people and in all

kinds of situations.

Except for the example described in the beginning of this section. Marketing strategy

can also involve this ethical ambiguity. For example, some products are marketed as

green products. The marketers use “green” to make consumers perceive they are more

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environmental-friendly, and maybe more healthy to the consumers. But the marketers

do not tell all the truth about the impact caused by all the compositions, the excessive

energy needed to produce green products, or even whether they exploit employee or

not. Marketers selectively tell the truth. Consumers are aware of this fact and create

their own rule for rationalization. Another example today is that the overwhelming

commercial messages are so invasive to people’s lives. People may think it is invasive

to their privacy and it can cause unnecessary worry of information security, such as

the spam-like pre-approved credit card invitations that people can receive every

month. All these confliction in marketing or consuming ethics can greatly raise the

threats of CFH, and the situations can only be more and more complicated while

customers are more and more knowledgeable and involved.

Discussion

Why do some industries or companies encourage CFH more?

There are several major reasons for certain industries to encourage CFH.

1. Experiential based industry

2. Problem solving industry

3. More services are involved

4. Industry perceived to have higher margin but lower tech

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5. Bad perception

6. With unlimited availability, lower switching cost

If the profit of industries or organizations highly depends on customer experiential

values, customer satisfaction is the driving force of growth. Customers may abuse the

policy, for example, holding a party in a hotel room and messing up the facilities.

Some industries focus on customer problem solving such as call centers can also

encourage CFH more given that customers always come with their unsolved problems.

Sometimes if the industries are highly profitable but perceived with low-tech,

customers can perceived their profit is unjustified, and therefore they can encounter

CFH more often. Industries or companies with bad perception or bad names are

always good targets for reasoned CFH, for example, customer’s use of cracking

programs on Microsoft’s software. There are still other reasons that can explain why

certain industries and companies are more likely to be the target of CFH’s attack.

Is CFH product-specific idiosyncrasy?

There is no clear category in which product type may encounter CFH more. But there

is an observable trend that the more the services are involved or the more the

customers are involved in purchasing, the more likely the organizations encounter

CFH. The service quoted here can be the product itself (e.g. call centers), part of a

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product (e.g. restaurant), or associated with product (e.g. technical support of

consumer electronics).

Can CFH personality be measured?

To answer this question, it is necessary to ask if CFH behavior is a matter of

personality. It can be answered that personality is one but not the only reason of CFH.

The condition for the CFH personality measurement to be meaningful is that there

should be credible evidence that the scores on the measure relate to indexes of

meaningful non-test behavior (i.e., scores should be able to predict real world

performance). This statement implies that only if CFH is repeatable with given same

situation. In previous sections, personalities associate lower ethic standards can lead

to higher occurrence of CFH behavior. Some personality disorder such as paranoid,

antisocial, histrionic, narcissistic are also more likely to have lower occurrence

threshold of CFH. On the other hand, personalities like avoidant, dependent, can

suppress the likelihood of CFH occurrence. All these personalities can be measured

by personality measurement although many researchers often debate the effectiveness

of this measurement.

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Does CFH differ among scenarios?

Since CFH is strongly value-dependent, it can differ in different scenarios, especially

in different cultures. For example, in East Asia, people try to avoid being eye-catchy

in public, and therefore the CFH behaviors like the second and third typological

profiles described previous are less often than those in U.S. Another example reflects

the cultural difference is that in traditional markets in China or Taiwan, the customers

often perceive that the stores always deliberately raise the prices, and so low-ball

bargaining is usually acceptable. In addition, the customers in China and Taiwan often

perceive the values of service product lower compared to tangible goods even they are

at the same price, and therefore rather than bargain over the price of tangible goods,

they ask more service product instead during bargaining.

Except for cultural difference, the CFH may also depend on the ethos or thoughts, for

example, it can be observed that the CFH happens now more frequently after the

concept of customer-centric have prevailed marketing.

Conclusion

This study focuses on an unusual behavior by consumers, customers from hell (CFH).

It provides the overview of today’s complicated situations for both consumers and

organizations. Secondly, it provides discussions on the motivation and the behavior

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models of this kind of consumer disorder, which are not widely discussed in academic

studies. It also points out that the situations can only be more complicated in the

future because the consumers are getting more and more involved in the business

because they are more knowledgeable on marketing and because the marketing

information is easier and easier to access through Internet.

In addition, the ethic standards start to create more conflictions since the marketing

has become complicated and innovative so that CFH hazard is inevitably going to be

exacerbated. Finally this term paper provides some discussions based on several

conclusive questions.

Even though this topic does not fit the framework of the class handout very well, but

working on this paper with the research methodology learned from the class gave me

an even better opportunities to practice.

Reference

[1] Ron Zemke et al, “Customers From Hell”, Training, Feb, 1990.

[2] Ron Zemke et al, “Customers From Hell: When is Enough, Enough?”, MOBIUS issue #3, 1995.

[3] Stephen J. Simurda, “Clients From Hell – handling small business customer problems”, Home Office

Computing, May 1994.

[4] A. A. Grandey, “The customer is not always right: customer aggression and emotion regulation”, Journal of

Organizational Behavior, May 2004, pp 397-418.

[5] Lloyd C. Harris et al, “The consequences of dysfunctional customer behavior”, Journal of Service Research,

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vol. 6, 2004.

[6] Lior Arussy, “Customers are so emotional”, Customer Relationship Management, May 2004

[7] Roy J. Lewicki et al, Essentials of negotiation, 4th edition.

[8] Donald W. Fiske et al, “Theory and techniques of personality measurement”, Annual Reviews, 1970

[9] Stephen Brown, Free Gift Inside! Forget the customers. Develop marketease, Capstone 2003.

[10] M. R. Solomon, Consumer Behavior - Buying, Having, Being, 6th edition, 2003

[11] Morris B. Holbrook, B8601 class handout, spring 2008.