Mobile Home Park Mastery: Episode 221

Don’t Hide From Unhappy Customers

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Bill Gates once said “unhappy customers are you’re greatest source of learning”. Not only can you improve your business with unhappy feedback but also forge stronger bonds with customers by solving their problems. It’s also important to remember that you can’t please all the people all the time and can’t let a few unhappy customers sway what’s best for your mobile home park both as a business and a community. In this Mobile Home Park Mastery podcast we’re going to explore the world of unhappy customers: where they come from, how to deal with them, and how to harness their negative energy into a better business.

Episode 221: Don’t Hide From Unhappy Customers Transcript

Bill Gates, the founder of Microsoft once said, "Unhappy customers are your greatest source of learning." Interesting thought there. So what it's saying is that an unhappy customer is actually something beneficial to your business. This is Frank Rolfe, the Mobile Home Park Mastery podcast. We're going to be talking all about unhappy customers, what we can learn from them, what of it is actionable, and how that can make your mobile home park a better place.

Let's start off with the types of unhappy customers most mobile home park owners encounter on a regular basis. First, you have those who have legitimate problems -  repair and maintenance issues, manager issues, things that you as the business owner should solve. You're in the business of providing a happy environment for your customers and sometimes you fail. Not necessarily your fault, possibly one of your employees, but nevertheless, there are some things out there that make customers unhappy which are wrong, and you should not be happy with them being unhappy.

Second, some customers are unhappy because they just don't like living within the confines of rules and things such as paying the rent every month. These are customers you typically inherit when you buy those old mom and pop run mobile home parks and you bring them back to life. So that's another variety of customer you come into contact with frequently when you're doing turnaround projects.

A third are those who just hate higher rents and higher costs. They got used to paying mom and pop rents, even though those Mom and Pop rents were a fraction of the actual market rate, even though mom and pop didn't do any CapEx or provide any professional management. Nevertheless, they don't appreciate any of that. All they care about is that incrementally higher rent, how dare you charge me more rent despite the fact you've put in hundreds of thousands of dollars into CapEx. So that's another group.

The final group are those who are simply unhappy by nature: they wake up each day unhappy, they end the day each day unhappy and like Groundhog Day, they just repeat over and over and over. So how do you deal with these different types of customers as a mobile home park owner?

Well, the first group the ones who have legitimate problems and concerns, of course, as a good business owner, you fix those problems. So if someone is in a rental, mobile home of yours, and the air conditioner is not working, you need to fix the air conditioner. Don't delay, get it done. If you have a resident there who's had some kind of quarrel with a manager where the managers actually not in the right, again, that's not fair. That's not correct. Your customer is your life's blood. If you do not have customers, you have no revenue. Without revenue, you can't pay your mortgage or any other bills. So customers are very, very important to you. And they should be fairly and properly treated and immediately sell.

Next you have those who hate living within the boundaries of the parks rules, such as you have to pay your rent every month. How do you deal with those? Well, if you can't educate them on the necessity to actually live within the rules of your community, then they'll just have to go. Because those people who don't like living within those confines typically are hurting the quality of life of everyone around them. When you say, "Hey, we bought the mobile home park, you can no longer have wild roaming pit bulls," people will say, "I don't like that rule, I'm unhappy now. I like my pit bull to be able to roam free." However, that pit bull was menacing many of the other residents in the community, so that customer's unhappiness has therefore led to the other customers happiness. So often on that kind of customer if they simply cannot live within the confines of modern civilization, then they will just have to go. Now you can try as best you can to convince them it's they will have a much happier life themselves or they will only abide by the rules of modern society. But if you fail, well then that's a customer you can't fix. You just have to basically not renew their lease and let them move into a community that doesn't have any rules at all.

Those who hate higher rents, well, there's not a lot you can do for those people who do not appreciate what you do. Every mobile home park regardless of its size, regardless of the amazing job you've done, will always have those very few people who just complain and whine about everything. In our old mobile home park called North Lamar in Austin,  we got so much grief over although we made so much money with it in the end. We bought it at a $360 or $390 lot rent; by the time we sold it we were at $650. Most everyone in there appreciated that even then we were below market rent and we'd done such amazing things to the property. We'd repaved all the roads, we had rebuilt almost everybody's lot, their fence, painted their home, all free of charge. But nevertheless there was one individual who just hated everything we did. They liked it better back when the place was a dump. They liked it better when the roads had giant potholes, trash was everywhere, mattresses laying in the street. Yeah, that was their idea of utopia. But that's not my idea of utopia. So you have to run your business, you cannot let those few people who have the wrong idea about how business works or life works, or even what's best for the community, make you alter your behavior. So those people basically have to be kind of ignored.

Finally, you have the customer who is just simply unhappy by nature. In that case, you simply have to embrace the fact that they aren't happy, that they will never be happy, and you can't possibly ever make them happy, and just not worry about it. Just understand that's just a part of who they are and how they like to live their life. And as a result, it's a free country, and if they want to be unhappy, 24/7 that's great. But don't let it bring you down. So how do you harness this energy in a positive way? Because there's always  unhappiness in every business. It doesn't matter what the business is.  Ben and Jerry's ice cream, there's someone out there right now, I'm sure who just is eating some Ben and Jerry's ice cream, and they hate it. They're unhappy. The cherries in the Cherry Garcia just weren't juicy and cherry flavored enough for them. Or maybe they're mad because they didn't like how much that pint of ice cream cost. Doesn't matter. There's no business in the world that can have nothing but 100% happy customers, everybody has unhappy customers.

But then how do you actually do something of value? How does something good come out of unhappy customers? Well, the first thing is unhappy customers can often tip you off to really big problems in your community. Every community owner should have a helpline. This is a dedicated phone number and email just for your customers - we like to give them out and refrigerator magnets even - so people can contact us in the case of something wrong. Our magnets say, "Need help?" then the phone number and the email. You can learn a lot about what's going on through that helpline. You will soon find that such things as managers being intoxicated, things like that, which you didn't know, certainly were never revealed to you, undetectable for you as the owner there, these people are really doing you a favor. So sometimes the things that they are very unhappy about, for example, that the park is not mowing its common areas enough, this is very important data for you. Because a manager who's been corrupted, who's trying to get around the system and do a bad job for you, they're very, very clever. But they cannot avoid the eyes of all those customers who look at their work daily. So the helpline coupled with unhappy customers can save you a fortune. Many a park owner has been able to pull their mobile home park out of that tailspin, pulling back on the throttle and on the stick, and making it fly again in an upward trajectory because they got tipped off from those unhappy people via the helpline.

Another thing that's interesting is that unhappy customers made happy are more loyal than those who were never unhappy. Such a strange marketing idea. First time I read that I think I was back in college, I thought how unfair that is. A business that has never had an unhappy customer would never have as loyal a customer following as those who had unhappy customers who they made whole. But think of it yourself, think of situations when you've been unhappy as a customer, and that business went out of their way to make you happy, you think, "Oh, wow, they really care about me." Whereas if you'd never be unhappy, you wouldn't really know their true nature, that they were so darn helpful. So when you have an unhappy customer, and you make them happy, well, you have a customer for life for the most part. We all know the average mobile home park resident lives in that park for typically around 14 years or so. But I imagine there's some that live, and we have them, 30 years, 40 years, 50 years. The ones you've kept happy the entire time, but yet had problems at one point, they're probably the kind they're going to stay for a half century or so. So unhappy customers can be a good thing for you. And as much as if you can make them happy again, they're very, very loyal.

Finally, the most important thing about unhappy customers is that their sheer existence keeps you on your toes, and keeps you in good order on all kinds of legal issues, rules and leases and everything out there. You're a little more focused on because your customers are often unhappy. If all the customers were happy, we would all let our guard down. We would never realize well gosh, you know, maybe I don't need to bother reading the rules. I'll just go ahead and take the old moms and pops and rent it again without realizing there's problems in it. Right? Maybe if all customers were happy, I would not look at those slip and fall hazards and think oh no, someone trips and falls though they'll probably just laugh it off because they're such a happy group. So the very fact that there are unhappy people, that there is a negative, pessimistic view existing in America today, maybe it's a good thing in some ways because it keeps all park owners on their toes, focused on the simple fact that there are people out there who will not be happy, and therefore they have to do their best to try and guard against creating unhappiness.

The bottom line to it all is, don't feel that you're doing a bad job if you have unhappy customers. They are to be found everywhere. Even the best community owners in America will always have one or two people who are not happy either by nature or for something else that you've done. So don't let that bring you down. Instead, try and harness that energy into running a better community. This is Frank Rolfe with the Mobile Home Park Mastery Podcast. Hope you enjoyed this. Talk to you again soon.