How to Detect a Toxic Customer


Photo by Francisco

A month ago I received a sales inquiry via email for my invoicing software package. The prospect asked if we could complete the questions he had attached in a spreadsheet:

I will need the attached questions answered in order to proceed as I can’t get them all answered off your website.

There were nearly 80 questions, at least half of which could be answered from our website.

In addition, he mentioned doing a flat-file exchange of data between our software and a custom piece his colleague had written. I mentioned that we have a .NET API or a web service layer, and that passing flat files back and forth would not be an optimal approach for a few reasons.

And that’s when it started to get good.

A snippet from his disgruntled reply:

My colleague is a computer engineer and has been programming for over 25 years so he knows what he’s doing. I just need pricing and questions answered at this point, thanks.

Wow, nice guy so far! I wasn’t trying to bust his chops, just letting him know about a potentially better approach.

Toxicity
After a few more emails back and forth it became obvious that not only might our system not be a good fit, but this prospect was very well not a good fit for our company.

It was apparent to me that even if this person bought our software after what looked to be an extensive due diligence likely to take up several hours, that our trouble would be just getting started.

Few things are worse than supporting a demanding, entitled customer who feels that their purchase price buys them control over your life, liberty and pursuit of happiness. I’ve run into my fair share over the past several years, and I call them Toxic Customers.

I’ve had toxic customers pull all of the following:

  • Call my cell phone five times in 5 hours on Memorial Day (A U.S. Holiday). The customer was U.S.-based and aware of the holiday.
  • Demand (not just ask for) support outside of our standard support hours because he was busy at his day job during our normal hours.
  • Consume 10 hours of support time over 2 months because he did not follow the installation instructions properly, and did not perform the troubleshooting steps I sent in my first response to his ticket. 30+ emails later I logged into his system, performed one check and found the issue.
  • And on, and on…

And while you (luckily) won’t encounter many toxic customers during your lifetime, after the first few you learn how to identify and gracefully step away when you see them coming. This is because toxic customers are not just a hassle, they can chew up support time, cost you money, damage your reputation by posting to Twitter/forums/review sites, and stress you to the point of wanting to commit an act of violence on yourself or others.

Early Detection is Key
After dealing with several toxies over the past few years I’ve begun to watch for warning signs during the sales process, and have become more adept at identifying potentially harmful customers early on in the process.

Any one of these warning signs is not a big deal, but stack 2 or 3 on top of each other and (depending on their severity) you have yourself a red flag.

Warning Sign #1: Disrespectful or Abrupt
People sometimes act as if they are not emailing a real person, and that’s ok. Sometimes we’ll receive an apology after we reply with a respectful answer.

The person might be in a hurry, they might not know email etiquette, or they might be a jerk. It takes several emails to figure it out.

Warning Sign #2: Asks for a Discount (With No Reason)
Perhaps the second most common red flag is someone who asks for a discount with no real justification. We always work with particular circumstances, especially schools and non-profits. But asking us to drop our price by 25% or 30% just for kicks is not typically a sign of an outstanding customer.

Warning Sign #3: Multiple Contacts, Often Through Multiple Channels
One of my favorites is to receive 3 emails (one each to our sales, support and info addresses), and a voice mail from the same person within a few minutes.

The request is not time-sensitive, the person just want to make sure someone receives it. And we do receive it…four times.

I’ve never really understood this one; either they are really anxious to have their question answered, or they don’t believe they are going to hear back. Either way, if you have to send four requests in order to hear back do you really want to buy software from that company?

Warning  Sign #4: Unrealistic Expectations
Another good one is receiving 4 emails in two hours with escalating urgency, all surrounding a non-time sensitive pre-sales question that can typically be answered on our website. Something like:

Is your software localized for Australia?

10 minutes later:

I wanted to make sure you received the previous email. Is your software localized for Australia?

30 minutes later:

Hello, is anyone there? I haven’t heard back from my previous email. Is your software localized for Australia?

20 minutes later:

WHY AREN’T YOU ANSWERING? DOES YOUR SOFTWARE HANDLE AUSTRALIAN DOLLARS OR NOT?!

Warning  Sign #5: Multiple Questions that Can Be Answered from Your Website
This one is common, and far from a deal-breaker. But it could be a warning sign of a future support burden, especially if you have an installation process that requires them to read and perform a list of steps.

Now Back to the Story…
With the next step of filling out the 80 question spreadsheet staring me in the face, I opted to let the person know that our company was not a good fit for their needs. I wrapped up our conversation with:

Thanks very much for your interest. I think you will be better off finding another invoicing solution.

Turns out we were just getting started. A few hours later I received the following (snipped for brevity):

Please explain why you are recommending I find another product. I don’t appreciate being sent off without an explanation. I will make that decision, not you. If it won’t work tell me why, don’t just tell me to find another product.

If you don’t want to work with me that’s fine, just forward me to another sales rep, but don’t shoe me off. I’m trying to conduct business here, I don’t have time for games. One last thing Rob, why don’t you use a last name?

Bingo! I especially liked the comment about my last name.

Yes, I happened to sign an email without my last name. Definitely a sign that I am hiding something, and that my company and/or software is woefully deficient in many ways.

I wrapped up our conversation by respectfully pointing out that at our price point we are unable to handle a manual sales process where we answer a large number of questions that can be answered from our website. I also mentioned the following:

I’m confident that in the end, if you purchase, your approach of using test file between applications is going to turn into a support headache. We don’t recommend that approach and are not willing to support it.

I genuinely think you will not be happy with our application and will be better off with a different solution. We reserve the right to sell our software (or not) to whom we choose, and I do not see this as a good fit for either party.

So once again, thanks for your interest. Best of luck finding a solution that fits your needs.

I had done my best to make this interaction as respectful as possible, without watering down the message. The bottom line is that I was pretty sure that this was not someone we wanted as a customer (and was willing to wager a sale on it). I’d been down this path before.

The next morning I received the following email from someone at the same company:

My colleague is the wrong person to be heading up this project and I apologize for his monster list. Can we hit the reset button on this please? Our needs are really pretty simple.

He listed four bullet points, all of which we handle out of the box. We exchanged 2 or 3 emails and he purchased within a week.

If you’ve dealt with a toxic customer let’s discuss it in the comments.

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72 comments ↓

#1 Stefan Richter on 12.09.10 at 6:38 am

Oh wow this rings a massive bell. Yes, I have seen lots of them, both in regards to product requests as well as projects on a work for hire basis. I love the ones that send you 20 page project specs and ask you to comment in detail on all points. For free.

But one case sticks out. A lady based in the US asked me to help her to implement what sounded like a pay-per-view video system. I did not want to take the project on but decided to jump on the phone to give her some advice on potential pitfalls. I did this free of charge.
After explaining the necessary steps involved in such a project (payment gateway, website front-end, video streaming service, database, hosting etc.) and a rough idea of price points associated with each of those elements she suddenly suggested that I was trying to scaremonger her; she went on to say that she would not fall for my tactics and accused me of trying to intimidate her…
Of course I had done nothing of the sort, in fact at first I thought she was winding me up in some sort of practical joke. I explained to her that this was just some free advice I was giving out so that she would not get stung, and that I was not able to help personally with any aspect of her project, so there was nothing in it for me financially. But she was dead serious and suggested we stop the call right there and she would not be intimidated by me. Remember she contacted me initially!

I hung up completely bewildered.

#2 Robin on 12.09.10 at 6:49 am

What about toxic co-workers? Just yesterday I got a phone call from our receptionist, who was asked by Colleague A, to call me to tell me he had sent me an email, said email informing me about another email he was preparing to send me :)

All of which was to make sure I got an automated email from our ticket system.

Sherrod Reply:

Ugh, that’s just so crazy. I would immediately take them aside and tell them to stop being a psycho. If that fails, I would demonstrate how to use email.

#3 James Sun on 12.09.10 at 9:16 am

Terrific post. I agree 100% with Rob’s statement that early detection is key. If a potential client is exceedingly difficult during the pre-sales process (i.e. exhibits more than 2 of the 5 warning signs), chances are good that they’re going to be even *more* difficult once they become a paying customer!

#4 Patrick on 12.09.10 at 9:50 am

Dead on, thank you for this posting. It is refreshing to hear others tell thier “toxic customer” stories…it makes that next CST Ticket/email a little bit easier!

#5 markee174 on 12.09.10 at 9:56 am

Excellent post. Reminds me of the day I came in to find a set of emails sent a to half hourly intervals which rapidly became more offensive and personal and finally ended with them announcing they would go elsewhere.

The sender had assumed everyone worked his timezone and I am not generally in the office 2am-5am my time.

#6 arthurbarbato on 12.09.10 at 10:01 am

Thank you, Rob. Your Toxic Customer post is the single best attempt to disembowel the golden goose (prospect) in a comic sketch I’ve ever read.

#7 sergio on 12.09.10 at 10:11 am

great article! i was JUST about to write an article about this same exact issue, but with a slightly different approach. i might hold off a few days.

anyway, i completely agree. many times, it’s cheaper and easier to drop a customer when you start to get “that feeling..”

another tricky issue? firing customers..

#8 Mike on 12.09.10 at 10:14 am

Oh I understand this completely, and I’ll be forwarding this to my boss to read as well! We deal with people of this nature all of the time. Some are worse than others, and some only have particular traits that others do not have, but they’re all pretty toxic in a way.

A) The multiple escalations are definitely something we deal with all of the time. I think it’s part of the mentality here in the US. People are impatient, their issue is the most important thing in the world, and everyone needs to bend over backwards for them. So they fire off e-mails to managers, to pretty much any contact they have in hopes of getting a response.

The difficult part is when people make a big deal of it (either the person receiving the e-mail doesn’t want to hear it), or the person receiving the e-mail thinks we’re failing at our ability to support our systems.

Either way, the key to dealing with people like this is to cut them off. If they e-mail the President/higher-up/business person, ask that business person to tell them to contact the support team.

There are a number of good reasons to follow a process to this. Part of which is that if the support team *is* failing in some way and can be improved, this lets them know where they are failing and how they can decrease resolution time.

But you have to give the system a chance to work, and that’s the problem. The systems never get fixed for any deficiencies because people over-escalate.

B) People who quote their resumes are some lively people. They automatically think they know more than you. They completely ignore the fact that you built the application, you know a lot more of the intricacies than they do. They seem to know everything. “I’m a ” or “I know a ” and that automatically makes them an expert.

I’ve fired back at people and told them that they should replace that person, because they’re not worth the money they’re getting paid.

And if the person is the subject of the credentials? I tell them to fix it themselves :P

But yes, there’s an easy saying that’s very commonly used in the US that has been integrated into our culture: “The customer is always right.” It doesn’t matter if they are completely wrong, everyone is raised to believe this idea.

And as long as that still stands, you will deal with a lot of these.

#9 jamie dalgetty on 12.09.10 at 10:31 am

great post. the problem we have is when the toxic customer has deep pockets and are too hard to turn away. i hate these more than any other because you actually DO want their business despite the attitude!

#10 Mike on 12.09.10 at 10:34 am

@jamie

No amount of money should enable a person to treat you as if you are beneath them emotionally, intellectually, or physically.

In most cases, they are there not because they were smarter or better than their competitors, but because they were lucky.

#11 Jan on 12.09.10 at 10:37 am

I’m dealing with this type of customer at least once a month. Usually a spreadsheet with questions that are answered by the website or an online demo is a perfect time to cut short any kind interaction. In 95% of the cases the whole thing turns into a cascade of emails that become more harsh in tone by every reply.

We’re developing a p.m, time tracking & billing app that has a free version. What i find really frustrating is the tone used by a really small group of free users who simply demand hyper-custom features to be build, because THEY need them – today :)

#12 Michael L Perry on 12.09.10 at 10:56 am

As an independent consultant, I received a request for proposal from a new customer. He wanted to evaluate consultants based on their ability to deliver. So the RFP asked for a working subset of the system. For free.

I was naive, so I wrote part of the system and won the contract. (I’m still not sure that I was actually competing against anybody.) Then we began a series of small deliveries of ill-defined features. He paid my invoices during this time, so I kept working.

Then one day we had a disagreement about the last week’s work. He said I had implemented completely the wrong thing, and that I had to redo it. I did so, but happily invoiced him for the week I had spent. The next envelope I received in the mail contained only the unpaid invoice.

I dropped him. But I should have known not to take the contract from the beginning.

Sea Archer Reply:

Anytime someone asks you to do something for free, you know right then and there it is a problem customer.

#13 Diego Mijelshon on 12.09.10 at 11:08 am

Good post, reminded me of http://www.christopherhawkins.com/06-13-2005.htm

#14 Jon Lim on 12.09.10 at 12:12 pm

Amazing post. During my time doing freelance videography work, a lot of your points will ring true. Especially if they are disrespectful and/or ask for discounts for absolutely no reason.

#15 Christopher Parsons on 12.09.10 at 12:22 pm

I like the way you closed the article Rob. We really started off on the wrong foot with one customer over the summer. The story was not too far off the story you sketched above.

We walked away from the deal. The customer came back, asked for a chance to clarify their behavior, and is now one of our team’s favorite (and smartest) customers.

What have I learned? Pay attention the the early warning signals but don’t rush to write people off. There might be a gem of customer wrapped up in less-than-optimal communication during the prospecting process.

Rob Reply:

You make a good point, Christopher.

Chris Reply:

I agree – we all get crazy psycho clients, and firing bad clients is a reality, but there are ways of turning toxic clients into good customers.

My top tip – if you’re dealing with a big organisation, look out for where your client contact sits in their organisation. Not their job title, but I ask myself “Is this person able to make decisions on their own?”. Often, if they are running a project but can’t make decisions on their own, they will turn toxic as they get squeezed between your limitations, and their boss’s aspirations.

If this situation comes up, get your boss (or get a colleague to pretend he/she’s your boss) and build a relationship with the decision makers at the client end. Take them for coffee/beer/golf. When things turn toxic, you suddenly have options.

#16 James on 12.09.10 at 12:35 pm

Echoed a conversation this week with a customer – expectations were out of whack from the outset. I clearly let him know what we could and could not support. In fact, I communicated to him that over the long term he will not be happy with our system for a variety of reasons. I found myself leaving the conversation happy that he was fully made aware of that the nature of his account and his use case rendered our software to perform in a sub-optimal manner.

After a lengthy point by point conversation he agreed to use our software according to our necessary restrictions and to fully acknowledge that the application will not perform at its best given his data requirements. (We are a multi-tenant, hosted app.) We will see how this goes, but he exhibited Warning Sign #3 for sure.

A tangential but related conversation would be the firing of customers. I have had to do this twice in the last year. Usually the earlier these conversations occur the better they go. I often fall on my sword here and just tell them “It’s not you, it’s me” or something along those lines and they get the picture and we part ways amicably.

Thank you for sharing your experiences – helps to know we are not alone out there in the wilderness!

#17 Ian on 12.09.10 at 12:44 pm

I recently a customer buy, then call my 800 number 5 times back to back, then sent 3 emails within 10 minutes, then called again an left a voice mail. This all happened in less than 30 minutes.

Call 1,2,3,4,5: Hang up.
Email 1: Anyone there?
Email 2: I just paid $30 and no one is answering.
Email 3: “What did I just pay you for? You’re just another scammer.”

Call 6: Voice mail (some elderly guy): “I’ve been trying to get a hold of you now for 30 minutes. But no one is there. What did I pay $30 for? You’re good for nothing, that’s what you are.”

I sent an immediate refund with a note explaining that he must have thought he was purchasing something other than software.

Ian Reply:

Sorry about the typos…I was interrupted 5 times while writing that one.

Sea Archer Reply:

Getting back his $30 must have made his day :-P

#18 Daniel on 12.09.10 at 1:45 pm

Just in case this missed your radar: http://clientsfromhell.net/

#19 Ben Day on 12.09.10 at 1:55 pm

Great post, Rob. I’ve been there, too. The hard part about toxic customer prospects is forcing yourself to trust your gut. Get a bad vibe off a potential customer? Dump ‘em.

Jon Peltier Reply:

It took me five years, but I’ve learned that no matter how much of a “good guy” a customer is, if he stresses me out, I’m better off without him. This year I’ve trimmed a few poisonous customers, and I’m much happier.

#20 Gabe da Silveira on 12.09.10 at 2:01 pm

Oh man, I would have loved to be a fly on the wall for the communication exchange that happened behind the scenes on that one!

By the way Rob, why don’t you use your last name on your blog, hmm? Is it because your last name is in fact non-entrepreneurial? How can I possibly evaluate your blog without seeing your surname in the header, footer and at least 3 times within the body of each post? I often write words at work, so you really have a lot to learn from my thoughtspew.

#21 Jason on 12.09.10 at 2:02 pm

While I don’t take on customers the same way that most others here do, I see many of the same patterns in my business. I operate a fairly sizable social network (sizable for the market we exist in) and the service is free to join, mainly free to use (ads + freemium model).

The biggest problem we find are individuals who become excessively irate when we are forced to remove their accounts for AUP (acceptable use policy) violations. We’ve had problems #1, #2, #4, #5 when this account cancellation occurs, including our most favorite … threats of some sort of legal action.

Either way, I plan to bookmark this entry and send it to customers when they become irate in the future. Thanks for the great blog!

#22 jon on 12.09.10 at 3:57 pm

I’m with ya 100% on difficult customers.

But imagine if the shoe is on the other foot, a website that’s ill-organized and makes simple answers to questions hard to find (written in shallow marketing-ese), with an “info@” email address that doesn’t confirm receipt of an inquiry– or what happened to me today: a google ad with a google-checkout logo and NO GOOGLE CHECKOUT WHEN YOU ACTUALLY PLACE AN ORDER!

if i can just suggest that if you’re getting a LOT of puzzled customers, some percentage of those are NOT idots, or difficult– just trying to do the same as you: get a job done, against all odds (or against all websites!).

Rob Reply:

Indeed; there are websites and situations that cause confusion for customers. This is why any one of the warning signs is not a red flag unto itself; it’s when you get a combination of 2 or 3 that you can start to make the determination.

#23 Barry Houslet on 12.09.10 at 4:00 pm

Rest assured that not all Australians are like that!

Rob Reply:

Haha, thanks for the clarification. I definitely wasn’t implying that :-)

#24 Miro on 12.09.10 at 4:53 pm

The worst type of customers are those who call you to demand personal support for a free product and 20 minutes into the abusive conversation on their part just hung up on you….

Sea Archer Reply:

Doesn’t free software imply no support whatsoever?

#25 Santi on 12.09.10 at 5:51 pm

I was sent this by my mentor, im trying to start a pc repair service.

Last night i was at a customers house, i already had ‘that feeling’ about her. She asked me how long it would take, and like an idiot, i said, “well, maybe an hour or so?” untill i realized her laptop was completely out of date and required a service pack update.

I charge per hour, and it ended up being that she at 1.5 hours gave me an amount of money in my hand, (slightly underpaying me), i received it and said; “thank you but it may end up taking longer then this…” She went into a passive aggressive rant about how i shouldn’t be looking at the time counting the minutes and how i cant be saying “sorry, its going to take longer now, sorry its going to take longer now etc”

My fault in retrospects, i need to learn how to be more assertive, charge properly per hour and perhaps overshoot my estimate to how long something could take.

So anyway, ends up being she sais; “dont worry about the virus scans, i can finish that up myself, lets leave it now” So i end up leaving.

Next morning like a terrible hang over she calls me 5 times. Ringing ringing ringing, she leaves voice mails first starting with “Hey, yeah what you did yesterday actually ended up getting my computer stuck now, you should have proofed it and not left so quickly, making sure it works correctly before you leave, i need to work now and it doesnt work, please call me”

Ok i can understand that, her IT ignorance is acceptable. Then another voice mail (within 10 mins) more angry along the lines of “Look i paid you and now this is broken, im fuming and i NEED to work, you will have to come round asap”

Again “Look im actually REALLY angry, i feel cheated of my money, especially as yesterday you where keeping your eye on the clock, you didnt do your job properly”

again (this time on a private number) “Look i f***ing dont f***ing have f***ing f***ing f***ing f***ing f***ing f***ing f***ing f***ing time for this, i feel cheated blah blah blah”

All this between 9am to 10am, great way to wake up. I texted her because i did not want to hear this so early, again, my fault, i should have received the first call i think.

My replies: “I cant talk right now, im sorry that happened. Turn it off then back on keep tapping f8 go to safe mode and do a system restore (short version), thats all you can do for now. Let me know how it goes ill give you a call when i can”

“I just heard your messages. im sorry you feel that way, of course ill come by and fix it for free. when is good for you today?”

“Of course i understand, the computer did have problems before though because it couldn’t handle a perfectly safe and well practiced method, all we did was uninstall an antivirus, install a new one and download updates. I can also understand how you feel about me not testing it for you, i feel i should have been more assertive with pay and time. I had felt you where pushing me all evening even though i wasnt finished, you chose to continue yourself to save money. Its my fault because i should have stayed the full 2 hours and taken my time not concentrating to finish for my customer whome did not want to pay too much. Ill come by today at 630 and do what i can for 2 hours but please do not rush me or lecture me because im coming to help you, im not a bad person and im not out to get your money, i do want to help, i apologize for yesterday i felt rushed and pressured and did not act professionally, ill see you tonight”

Obviously some aggression seeped through that text, she ended up then calling me with the cursing voicemail.

“Yes, please calm down i will come at 6 30, my text was not sent with hate or anger but understanding and compassion im sorry if it seemed otherwise. Please if i come i dont want to be sworn at or shouted at or lectured i just want to do my job, ill see you at 630″

She ended up texting me “Ok sorry for swearing. I am really upset and angry (no shit). i will be nice when u come, thanks”

In hindsight, i feel like i calmed her down eventually but i wanted her to know she was being a complete bitch, and please dont get me wrong, i can understand her point of view, i can see how it is from her angle but what does she expect if she wants to save money and rush me before i finish, make me feel like shit for charging her what i charge any other person.

ANYWAY, ended up being that i arrive, yes i first received a lecture on how i shouldn’t have looked at the time and should have just set how long it was going to take early. And that she is sorry for swearing but… etc etc.

So, to really wrap things up, ended up being that her inbuilt laptop mouse wasnt working, the right click was stuck and it kept right clicking everything thus infuriating her. Now i wasnt going to say anything but my guess is that she got pissed and hit it, wouldnt put it past that temper. Im pretty sure it was fine the day before.

Anyway, she ended up feeding me, apologizing lots but also lecturing me and then apologizing some more.

I wasnt paid but now im left with a happy customer that will be more inclined to recommend me.

Good thing it ended like that coz there was no way i would have given her the money back.

;)

Anyway, thats my experience of a toxic customer, i will try to save myself headache pre-maturely next time.

Thanks for the post, very insightful.

#26 Ryan Allen on 12.09.10 at 8:19 pm

What is wrong with Australia? I demand a refund, satisfaction and a Kangaroo!

Michael Reply:

You should ask for an Emu, they are easier to ride to school then Kangaroos :P

Sea Archer Reply:

I demand an apology and an explanation addressed to my pet kangaroo that was offended in the creation of this blog post :-P

#27 Anonymous on 12.09.10 at 8:36 pm

We had a customer dial up our company after-hours (so no receptionist) and start dialing random extensions and leaving voice-mails about their problem.

#28 Elizabeth on 12.09.10 at 10:33 pm

I format ebooks. My business is almost entirely by word of mouth.

I’ve had to fire a client I shouldn’t have taken (I gave her her money back just so I didn’t have to deal with her).

Last month, I had one that assured me he knew the limitations of ebooks (i.e., they WILL NOT look like the print version) who nickel-and-dimed me to the tune of 200 hours (for a 40-hour project) because he wanted to tweak everything so it would look JUST LIKE THE PRINT VERSION. After the 43rd “see PDF,” I told him no more (since technically the project was finished).

And just today I’ve been dealing with someone who wants free tech support (e.g., he wanted me to tell him how to zip his files). Sorry, but if you want me to format your files, you gotta get ‘em to me. I don’t really care how. At this point, I’m in 2 (unpaid) hours for a demanding person who lives in Europe and thinks I (central US) am operating on Spain time.

A friend tweeted me this article and I promptly sent that potential client on to someone else. Sometimes there’s just no amount of money that makes up for dealing with people like that.

Thanks for the post. So glad to know I’m not alone.

#29 Netpaths on 12.09.10 at 11:19 pm

@elizabeth So glad to know I’m not alone.

My thoughts exactly

#30 Tavulteguy on 12.10.10 at 2:22 am

Excellent points Rob – this happens to me all the time.

I wonder – if a customer is so highly toxic, do we really have anything to fear from firing them? I’d imagine any friends who could be affected by word of mouth would be either a) equally toxic in character or b) fully aware of the toxic persons penchant for toxicity. At least, it would work that way in a perfect world ;).

Anonymous Reply:

You have a point, except that the internet gets in your way here…a jerk can spread a lot of negative news about your company if they wish. People will tend to believe them. Luckily this doesn’t happen very often (at least in my experience).

I’ve found the earlier you are able to get rid of a toxic customer the less likely they are going to voice their opinion publicly.

#31 Vincent van der Lubbe on 12.10.10 at 2:50 pm

+1 It’s all about relationships – the principles are the same in personal and business life. Sometimes one needs to set limits to make the relationship work.

#32 Igor on 12.11.10 at 5:29 am

We sell physical products. For any “toxic” customer we immediately offer full refund. 99% of customers did not take it and becomes happy with the products somehow. Sometimes I think, that these people just need to discuss with somebody for a while…

#33 Vineel on 12.12.10 at 12:58 am

You didn’t mention the worst kind — the Fortune 500 Toxic Customer. You bend over backward to get the business, thinking that it’s going to lead to fame and riches for your little company. You fly out to the other coast for pre-sales, you change your product to suit their needs, you staff up to prep for their business cycle. One day, you wake up and wonder where all your other customers went, and, oh yeah, where did the profits go? Then they switch vendors and you’re left with an over-specialized product, oversized staff, and a zombie product. Ouch.

Rob Reply:

Ouch; you’re right. That does sound like the worst kind. And it sounds like you speak from experience…

#34 Ethan on 12.12.10 at 4:38 am

An excellent excellent post.
A few points I thought are worth mentioning –

1) I’ve had the pleasure of doing work in different parts of the world (it’s only a pleasure if you refrain from being judgmental). A cultural difference may create a lot of misunderstanding in this respect. In some cultures, as a customer you’re allowed to be very demanding, and to match that, the seller is allowed to tell you to piss-off. On the one hand it creates a very stressful negotiation period. On the other hand, it’s kind of nice to be able to just speak your mind, knowing that if you do end up closing the deal, there will be no hard feelings later on. If you think about it, what happened to you with that customer is a good example of what I just said (though I’m not sure the cultural difference played a role). They were annoying, you told them to piss-off, they came crawling back begging for the solution still.
This is especially important if you’re selling products or services internationally.
And the more I think of it, taking the approach of “we think our product may not be a good fit for your needs” is one of the ultimate tests, and you were very right in using it. A truly interested customer, no matter where they are in the world, would either respond with an apology, which means you may still be able to take them in as a customer, or they’d go away b**ching and moaning, in which case you were right to send them off.

2) Having said that, in my home country (Israel), there’s a huge amount of toxic customers. It’s a niche of the market – everyone thinks that most of everyone is out to get them, so even the polite gentle people have to develop an aggressive bone if they want to survive in business. I’d say between 30 and 50 percent of the customers here might be toxic (sorry, fellow countrymen). The fact that they are so many, does not make it any easier to deal with them – they are just as annoying as toxic customers anywhere else, but it does reduce your target market significantly if you’re not willing to work with them.

#35 Jon Peltier on 12.12.10 at 11:58 am

My two main lines of business are (a) custom-built software and (b) click-wrapped off-the-shelf software.

Customer interactions are much more problematic in the first case (custom), because problems of communication and mismatched expectations can become large, before, during, and after the project.

With pre-built software, before the purchase, there is either no communication, or very little, with a distinct question, which is usually answered in the web site, but which takes all of thirty seconds to respond to. After the purchase, if someone doesn’t like the software, I can suggest how they can better use the software, which is usually a couple of emails, or I can simply cancel their transaction or refund their money ($49). If I do have to answer a question or make usage suggestions, it often tells me to rephrase something in my web pages or documentation, so I can always consider it a positive thing, even if I do give back the purchase price. And returns are only 1% or 2%, so it’s really not a big deal.

#36 Excel_Geek on 12.12.10 at 3:19 pm

Great article and ensuing conversation. I’ve dealt with many toxic customers over the years. The trickiest to me are, we’ll say, are branch location level customers that belong to a large multi-location firm that you’re trying to penetrate. It’s very tough to disengage from one without risking the rest. Thoughts anyone?

Rob Reply:

In that case, I think you have to bite the bullet. There are only certain cases where you can simply walk away from a toxic customer, and if they are a big portion of your revenue (or have the potential to be) that’s probably not one of them.

#37 How to Detect a Toxic Customer – My New Cheese on 12.14.10 at 8:24 am

[...] has posted a nice guide on how to detect a toxic customer.  A toxic customer aka a bad customer is one that doesn’t make you any profits because they [...]

#38 Will on 12.14.10 at 10:26 am

Being in sales for the last 3.5 years, I’ve had my share of toxic customers. I had the fortunate experience of having my first job in sales being home security systems. Dealing with two and three sales calls per day, five to ten installs per week, where you are the customer’s #1 POC for all problems relating to their system, you learn to recognize the signs FAST and excuse yourself from the sale even faster. I once drove over two hours to a lead’s house and was out the door within 15 minutes without regret. The guy was just such a perfect jerk.

Even with all that experience, I can still fall into the trap every once in a while. Mostly when the person is perfectly nice during the initial consultation, but turns into a raging headache once the project is underway. That happened to me with my first Search Engine Marketing customer. It was for a small business run out of the owner’s home, so the initial sales call was done at the dining room table. Everything went great, they were excited when I left with the signed contract. About two weeks in the toxic e-mails started flowing and did not stop until the end of contract. My boss wanted to fire them as a client, but since it was my first contract I begged him to keep them on while I built my practice. He agreed on the condition that I would handle 100% of the work for the account, since the owner had called the main office an berated the service desk manager. Needless to say, when the client told me at the end of six months they would not be renewing, I wished them good luck and made exactly zero effort to retain them.

Looking back it was probably a mistake since the time I ended up devoting to managing this difficult client would have been better spent looking for other clients or working on the clients for whom search engine marketing really worked. I’ve since founded my own on-line marketing firm (www.bigbluebearconsulting.com) and plan, going forward to avoid the trouble of a toxic client. They really just aren’t worth the effort.

#39 My New Cheese on 12.14.10 at 3:33 pm

Nice post, although I disagree about asking for a discount. Although it depends on the product or service and price of course. If a customer is asking for a discount on a low priced item then they may be a potential toxic customer, however if it’s a high price high margin item, I think it’s justifiable.

Rob Reply:

For the most part, any of the above on their own are not red flags. But once you get a couple of them together in the same customer you should be wary.

#40 Weekly linkage on 12.14.10 at 6:24 pm

[...] How to Detect a Toxic Customer | Software by Rob – Speak on it, brotha. "And while you (luckily) won’t encounter many toxic customers during your lifetime, after the first few you learn how to identify and gracefully step away when you see them coming. This is because toxic customers are not just a hassle, they can chew up support time, cost you money, damage your reputation by posting to Twitter/forums/review sites, and stress you to the point of wanting to commit an act of violence on yourself or others." [...]

#41 Sean on 12.15.10 at 8:10 am

Interesting post: not all software sales are equally profitable or equally desirable. I think your example also shows, though, that what starts off as a toxic transaction can be turned around. When people ask questions that are answered on the website, it’s sometimes because they couldn’t find the answer there, which might be useful feedback for the website team.

I’ve had a lot of success by posting a list of frequently asked questions above my contact email address, and pointing out that using it gives an immediate answer to most of the questions I’ve received in the past. I’ve also included answers to some of the sillier questions I’ve received there, so that I don’t feel any obligation to waste time replying to emails asking them again.

Rob Reply:

Thanks for the input; that’s a good tip to post an FAQ above your support email address.

#42 Clay Nichols on 12.17.10 at 7:24 pm

Been there. Done that.
But there’s a related issue (which I love resolving): a customer interaction which has gone bad but can still be save.

E.g., a customer who gets angry over a mis-communication. I love salvaging those (if it’s worth saving).

One thing that helps is what your Toxic Customer did: Ask for a restart and put someone else on the case (even if your employee wasn’t at fault). A fresh voice on the phone helps to leave some of that baggage behind.

#43 Clay Nichols on 12.17.10 at 7:26 pm

BIZARRE bug in your Comment software: I posted something but it’s not posted. Instead, someone else’s (quite good) comment is attributed to me. And my post is… lost.

Clay Nichols Reply:

Nevermind. My browser just needed a refresh.

OMG – I AM BEING a Toxic Customer :-)

Rob Reply:

Oh, I’ve seen worse, I assure you :-)

#44 Tom Mornini on 12.20.10 at 4:01 pm

Great post, your list largely matches mine, and your recommendation to “go with your guts” is right on! If a customer makes you feel uneasy, that’s a major warning sign.

I have another point on my list: Big talkers! “This is going to be (is) gigantic, vitally important. I’m (we’re) talking to industry and government (God!) directly.”

This is PARTICULARLY dangerous when there’s a huge gap between opportunity size stated, and resources they control, i.e. it’ll be bigger than Facebook, but must cost less than $1,000 to develop. :-)

#45 Toxic « The Big Think on 12.20.10 at 5:45 pm

[...] to detect a Toxic Customer (thanks to Jason Cohen for the link). Comments [...]

#46 Jon on 01.03.11 at 3:22 pm

I disagree with some parts of this post–the problem possibly is “customer expectations.”

We now live in a 24/7/265.25 business world. Although it ended up to not be urgent in the case you described, sometimes these sorts of issues are urgent–to your (potential) customer. If you give multiple points of contact, you should expect to be contacted on them, especially if the customer feels the matter is fairly urgent in nature. I can understand how repeated, “non-acknowledged” replies could make one get “snippy” if the problem is not fixed in a timely manner, nor if one was expecting a quick/simple fix to occur. I also do not expect the world to stop because the contact is made at 4:59 on a Friday afternoon local time. If you give your cell phone as a contact, people expect to reach YOU and not your voice mail. They also expect email and web-based contacts to be answered promptly; sometimes a simple and respectfully-written “we are out of the office but have received your contact and will address it ASAP” autoreply is enough to placate the customer–you might consider using this so your customers know your email system has received the inquiry and that you will be addressing it soon.

Excellent posting, by the way. I feel this “pain” too frequently.

#47 Chris Blanton on 01.08.11 at 9:17 pm

Terrific post. I wonder how many of these problem customers used to be pleasant but now are a result of non-responsive companies that take days to respond to a time-sensitive matter or do not reply at all?

For instance, the respondent who complained about your not signing a last name. Maybe it was an overreaction to the ubiquitous anonymity of reps from other companies who don’t sign ANY name! I’ve had countless back-and-forth correspondence with certain companies who sign their emails with “Your Service Team” or some such nonsense. The discontinuity and anonymity allude to furtive actions, appearing that nobody accepts responsibility for anything. It causes them to lose credibility in my eyes, and I’d bet most customers are sick of it. I know my awful experiences with certain companies have changed my behavior for the worse.

The cell phone companies have permanently altered my trust in call centers. They all claim to ‘take notes’ on a particular problem, but upon calling back mysteriously those notes have vanished and the person isn’t in the system. If I provide the rep’s call center ID, often I’m told it’s unrecognizable, that they all have six digits vs 8, or something equally ridiculous and humiliating. Sometimes they get combative and tell me I’m wrong.

Where before I never would have imagined I would suggest I didn’t believe a rep on the phone, now when dealing with those companies after being repeatedly burned or lied to or dealt with by a surly rep by a particular company, I will tell them outright that they have no credibility, that they’re a faceless drone on the phone, and I have no reason to believe them, despite their assurances, because I have been lied to before by the guy before them. I insist everything be in writing. Sprint, for instance, refused to put anything in writing. So I don’t use them anymore.

Email is no better a medium. We’ve all probably received those form letters from mega-corporations that don’t address our issues, maybe after we painstakingly described exactly the piece of information we wanted after having spent an eternity in the FAQ and knowledge base looking for it.

There is baggage and disgruntlement on both sides.

So what’s the trick? Maybe it’s to ‘hit the reset button’ on each transaction as the ultimate customer in your article proposed. It’s tough for a client not to carry the same baggage after having gotten repeatedly burned, and the client has no obligation to be pleasant; the customer service rep is the one who gets trained to deal with customer gripes.

But as long as some companies offer egregious service and lie and insult customers, this is the backlash. It’s all a result of the internet age and lack of accountability.

Great article.

Cheers,
Chris

#48 The Customer Isn’t Always Right: Keeping Customer Conversation Authentic « Quality and Innovation on 01.13.11 at 9:51 pm

[...] for example, a blog post we really enjoyed written by a guy named Rob – entitled “How to Detect a Toxic Customer”. Sometimes, your potential customers are vast reservoirs of viscous, acerbic sludge that will [...]

#49 Doug Wagner on 01.14.11 at 1:45 am

I fully agree with you. It is not worth it to bend over backwards for “toxic” customers. Excellent reminder to be vigilant up front before the relationship gets too deep.

We fired a fairly major client a few years back because they were never happy, always wanted freebies after the fact and quite frankly, sucked the life out of us. Still don’t regret it; I sleep much better at night.

As a small business, your client’s are like your employer. Choose wisely.

#50 Wolf Becvar on 01.19.11 at 8:10 am

Rob I acknowledge parallels in every line you wrote here. Spreadsheets to be filled out upfront, important projects that have a serious deadline and therefore the *bug*, which turns out to be a simple misunderstanding needs to be fixed ASAP!!! But running a SaaS business I guess the post invoice claims turn out to identify the real customers from hell!

Just a few of my favorite examples:

“i thought i was on a trial.
i have closed my account.
please credit me the charges incurred.”

“I thought I had cancelled this account, as you can see I have not been using it. Please refund the $8.33, and close the account for now.”

and the best one:

“YOU MAKE IT VERY DIFFICULT TO REACH ANYONE , TBUT MANAGED TO SEND EMIAL
SAYING THANKS BUT NO THANKS. REVERSE THE CHARGES ASAP. THANK.S”

and a brand new one:

“i would like to cancel my account because i actually didnt even know i signed up for it. I thought it was free.”

We stated in our TOS that we usually don’t do refunds but it sometimes it happens you’re better off providing refunds in order to not risking a chargeback, which means in our case instead of refunding the price for the smallest plan ($7) you end up paying $50 chargeback fees, which is really rediculous and you can’t do nothing against it once stated. Always wondered why chargebacks are not being examined by the CC companies, like the mediation system the comes with PayPal?

#51 Nur Nachman Eytan on 01.20.11 at 1:13 pm

So true…

#52 John Gallagher on 01.21.11 at 8:56 am

Couldn’t agree more with everything you said.

I feel like my negative experiences have happened, not just because the person I was dealing with was disrespectful, but that I was allowing them to disrespect me.

It’s easy to fall into the role of a victim in these interactions, and as you say, there’s a way of interacting respectfully with the toxic customer that’s says “I’m not going to allow you to treat me or my company this way”.

One of the prerequisites for this approach is a certain confidence and being assertive. But even if you’re not, you can pretend to be. Just as long as you don’t play the victim…

#53 SaaS on 01.23.11 at 2:55 pm

This is a post that hits very close to home. I have dealt with many of these kind of clients. They are selfish and childish. I have learned to deal with them but the time that it takes to service their every desire is not always worth it. However, with a little training in the beginning many of their “demands” can be defussed. Customer training is one of the things that a sales team needs to be aware of due to the fact that alot of these problems stem from the sales process. Sales people, sometimes promise things that can not be delivered. That prompts clients to be unreasonable.
Yes, some are just plain bad and I like the warning signs that you have pointed out, identifying them before they get into the system is imperative and should start in the sales process. Thanks for the post.