Entries Tagged 'Customer service' ↓

You know I’m a fan of Southwest Airlines and a complainer about AT&T Wireless. But how much are my opinions actually worth to those companies? An former client, Satmetrix, has devised a back-of-the-envelope exercise that shows how to calculate the value of word-of-mouth (WOM, pronounced “wom”.)

Start with the following assumptions:
1. The lifetime value of a customer before considering WOM is $1000.
2. Promoters buy more at higher margins and defect at half the average rate, so their value before WOM is 3 times that of an average customer.
3. Detractors’ lifetime value is half that of the average customer due to complaints, higher service costs, and short tenure.
4. On average, Promoters make 4 positive referrals, 0 negative referrals.
5. On average, Detractors make 0 positive referrals, 3 negative referrals.
6. It takes 6 positive referrals to generate a new customer.
7. Each negative referral neutralizes 4 positives.

Based on these assumptions, you can now calculate the following:
1. What is the full value of a promoter compared to an average customer?
2. What is the full value of a detractor?
3. What is it worth to convert a detractor into a promoter?

The results may be eye-opening, and will certainly show why it’s smart to be good to your customers instead of treating them like crap. If you like this exercise, it’s worth converting the formulas into numbers that are are more reflective of your experience with your own customers. Have fun!

At the SXSW Web Awards on March 15, the Adobe presenter gave a shout out to “all the social media gurus in the audience” and a titter ran through the crowd. The reason it’s funny is that, certain people’s business cards notwithstanding, this whole business is simply too new for anybody to be an expert. Everybody is figuring it out as they go.

Here are a couple of examples of companies that are figuring it out. They’ll do as best practices until something better comes along, and they’re also good illustrations of why companies are so fascinated by the potential of social media.

1. Everybody in the US knows about the Oscar Mayer WienerMobile: a funky vehicle shaped like a hot dog that tours America and shows up in the oddest places. In years past, someone who saw the WienerMobile might have told a few friends about it. Now, they’re likely to Twitter to a much larger audience… and Oscar Mayer’s PR folks are regularly searching the subject #wienermobile so they can respond to these posters, thank them for their interest and offer a coupon or just a continuing relationship through mutual following. (This illustration was presented by their PR consultant in one of the SXSW Core Conversations. Didn’t catch his name.)

2. Steve Barnes writes Table Hopping, a lively restaurant blog on the Albany Times Union website. When he reported that Red Lobster was going to offer flame broiled fish, skeptical readers commented that installing a flame broiler is very expensive and they were probably going to just sear it with a poker. But then the Red Lobster president himself found the thread and commented that indeed they were going to install flame broilers with a plausible explanation.

Not only did this defuse the negativity in the comment thread, but it got a new post from Steve Barnes himself: “Check out comment No. 18 on the post below about Red Lobster. It’s from the company’s president — yep, the top guy of a 680-location chain — and it’s not a canned reply but one that addresses specific comments made by Table Hopping readers.”

That’s good PR you can’t buy, but you have to work for it. And what is happening here is that Red Lobster is monitoring comments throughout the social media space using a tool like radian6 or boorah, both previously mentioned on Otisregrets, to keep track of comments so they can be responded to.

A company offered a $10 billing credit over the holidays if I clicked through to their site from a promo email. My statement showed up, no credit, an inquiry to customer service went unanswered, so I contacted PR department and sent them a pdf of the ad along with the email thread. The response:

In response to your inquiry about the $10 off credit, please note that the offer for this credit expired 12/31/08, as indicated in the PDF file sent. However, to reestablish your happiness as a Bill Me Later customer, we have credited your account $10.00. Please be advised that you shall see this change on your next billing statement.

Uhuh. First of all, if she’d checked my file it would be clear that the purchase was made during the eligibility period. Even if not, the customer is always right. To “reestablish my happiness” it would be helpful to eliminate the nyah-nyah.

Today’s SF Chronicle has an article on boorah.com, one of the growing number of services that allows business owners to get a perspective on how they are being talked about on social networks. (Others include circos.com for hotels, and radian6.com for businesses in general.)

Curious about boorah, I looked up Jack’s Burger House in Dallas. The front page of the review has the comment that “The waiters were terrible , it took us 30 minutes to be seated even though I made reservations 2 weeks in advance , and the food tasted like it came out of a can and was way over priced … It was absolutely TERRIBLE!”

Problem #1: Burger House is a hole-in-the-wall burger restaurant. If you tried to make a reservation they’d laugh. Problem #2: this review doesn’t actually exist; if you click through to the “more” it doesn’t appear among the expanded commentary. My guess is that there is some kind of database sweeper that goofed and pulled the data from the wrong place… but meanwhile there is what looks like a real restaurant review on a real reviewing website, bad news for Burger House if anybody reads it and certainly for boorah which will need to fix this problem, stat.

A cautionary tale with the moral being, don’t throw that “go live” switch before you’re sure you’re ready for the world to see your website.

So I am finally got my iPhone. Per the earlier post, my web order disappeared into automated customer service limbo yet was impossible to cancel until I called a live sales rep. Meanwhile the price dropped $50 so I place the order again and it goes through with me $50 richer and ATT $50 poorer. And with me, a long time AT&T customer who is now a “new” wireless customer, holding a vastly reduced favorable view of the company. How is this good for the shareholders?

For people who have to call customer service on their lunch hour, stories like this are just more yadda-yadda. But for the marketer came up with the promotion that drew me to AT&T at this particular moment, and is getting reviewed for it possibly with their job on the line, it’s not at all trivial. You did your best work, you got the click, and then the order was deep-sixed by a combination of bad IT architecture and moronic overview by whatever human is supposed to spot-check to ensure all is going well.

I will not bore you with the details of yet another poor customer service experience beyond citing a couple of particularly telling details:

* “Unfortunately, either we have not heard from you in several days, or you have chosen to cancel your order. In either case, this e-mail confirms your order cancellation”. That was in an email I got from AT&T during the first attempt to order. But notice we’re talking about two totally different customer relationship scenarios, and they’ve chosen to respond to both of them in the same email.

Why would this happen? Because some human life form has decided it is “too complicated” to have two different stock emails to respond to two different scenarios that create the same result. The computers don’t care! It is people thinking for the computers that is causing the problem here.

* Now I’ve finally got an order placed, and a confirmation email arrives: “Congratulations! You’re now part of the largest wireless community in America—71 million and growing! You will receive your new wireless phone in a few days.” Well that’s interesting news, since the original order confirmation promised two-day guaranteed delivery! There is also a tracking number in the email but when I click on it, it takes me to AT&T’s home page!

So recognizing it as a UPS number I go to their tracking page and do indeed find the package quickly and discover it actually will be delivered on time in spite of AT&T’s hedging.
Why didn’t they actually confirm that they were delivering on schedule in the confirming email? Why didn’t they reference my specific smart decision to buy an iPhone? You guessed it… they send the same confirming email to EVERYONE, regardless of what offer they responded to.

Just imagine the phone calls to customer service this generates. But there is apparently no consequence and no human cost to AT&T because they have no intention of answering those calls. They’ll be led through a phone tree and ultimately disconnected as I was in my first encounter.

I feel like such a whiner in describing all this but I actually do have a point worth making. In this terrible economy, when every company should be scrambling for every last potential order to keep its bottom line healthy and to keep employees employed, AT&T is running its business like there is money, and orders, to burn.

Much of this definitely goes to the laziness of midlevel IT and customer service folks who are scheming ways to go home on time, not to execute their job which should be to make things easier for the customer. But it also goes back to a hubris that has existed from the tim companies like AT&T established their websites… because face it, the web experience with any phone company is terrible.

What they did: get on the web early, because they’re an Important Company that needs a “web presence”, then cobble on an e-commerce function as an afterthought. Now the tail is wagging the dog because their ecommerce engine doesn’t work and the ridiculous official explanations sound like one of those clone commanders in Star Wars. What they should have done: emulate sites like amazon.com. (or, just emulate amazon.com) which realize that no order can be allowed to get away.

So I got a new iPhone for Christmas! Gift from my wife, but it’s hard to handle somebody else’s details so placed the order myself… a refurbished 16 GB from AT&T at a $50 savings, with guaranteed 2 day delivery, what could be better? But when the phone did not arrive today as promised, I realized such smooth service from a wireless company was too good to be true. And took a leap into the AT&T customer service rabbit/rat hole.

I jumped in by clicking through to the “order status” link on my confirming email. The web site said ATT had no record of that order. I called the customer service number on the email (800-331-0500) and after I provided much information to gain access to a rep, got a recording “we are unable to transfer your call.”  Here’s an idea! I have a landline account so I’ll login in that way and see if I can talk to somebody. I get a message “we are unable to accommodate your request at this time.”

So I am stuck, right? No, I have one avenue left which is where I recommend you go whenever you are met with a customer service roadblock: call the SALES department. Unlike customer service or tech support, they will always have plenty of people to answer their phones. And they have the clout to get in through a back door to the customer service department when a lowly customer would be denied.

The sales guy was prompt and helpful. My order did exist but its status was “pending” because of “credit review”… this for a 20 year AT&T customer who never has paid a bill late. He cancelled the order for me and I guess we are both better off. Though in this economy it would certainly seem that AT&T would want a few thousand dollars in guaranteed commitment from me.

So a chef brought a great tasting chardonnay blend to a party, and I wanted to have more of it. Fortunately I’d saved the bottle (Novella Synergy 2007) and started checking with the usual Bay Area sources where a chef might buy his wine including Ferry Plaza Wines, K&L, Wine Warehouse and Jug Shop. No luck with any of these so I stopped by the eclectic and wonderful Bi-Rite Market on 18th St and spoke to Joshua the wine buyer who expressed interest because it is a Paso Robles wine (one we don’t see as often as others) and offered to see if he could get it.

The next day he called me at home and said he had telephoned the winery and learned that the entire vintage had been sold to… Trader Joe! Which of course is the Walmart of crunchy gourmet stores, threatening to put the independent Bi-Rites of the world out of business, so it was even more remarkable that he passed this info along. Of course I am going to go over to TJ and buy a case, but I am also going to make a far greater attempt to give Bi-Rite my business including their 10% off a case sale next month.

This is another example (the first was from Timbuk2) of a company giving extraordinary, old-fashioned personal service which is all the more distinctive, and consequently more valuable for both the customer and the vender, because others are dumbing down their service. Compare, for example, to this experience with Electronic Arts, when I found my 11 year old has discarded the paper with our CD key for an electronic game and asked EA if I could have a new one if I sent them the receipt and a photo of the original disks to prove we own them. They responded with an email that told me to go to a web page to read the response there, always a bad sign, where I found:

If you have not register the game and if the Registration code/Serial
Number/CD Key for the game has been lost or misplaced then you will need to
purchase another Registration code/Serial Number/CD Key from our warranty
department, please mail our Warranty department the following information:

-The [Proof of Purchase] page from the manual, or if that is not available
the game disk.
Note: If you send the game disk, please send it using a traceable method as
Electronic Arts is not responsible for products lost in transit.
-A letter explaining that you need a replacement serial number.
-A money order for $10.00 USD.
-Note: We do NOT accept cash, checks, or credit cards.

So EA is going to make me spend basically the original price of the game to get satisfaction, while Bi-Rite is sending me to a competitive store. The cost of the EA response was minimal, the cost of Bi-Rite’s probably $5 when you consider Joshua’s time and his phone calls. But in terms of future buying behavior from me that might result in profits to the vendor, Joshua’s approach makes far better sense. Bi-Rite is at 3639 18th St (parking difficult). If you need wine suggestions, call (415) 241-9760 and ask for Joshua.

When I made a move from Southern California to a small town in Oregon, back in 1990, I wondered how many clients I would lose from my freelance copywriting business. I’d promised everybody I would assiduously stay in touch via phone and fax (no email then), and to show up in person whenever needed. Even so, I did lose business—including one regular client who said she couldn’t possibly work with anyone who wasn’t local, even though her office was an hour away from me and I saw her maybe twice a year.

We have come a long way since then. It’s commonplace to have people on several continents on a conference call, and to maintain a virtual identity via email and chat. So much so, I think we may take our connectedness for granted and not realize that clients and colleagues don’t find us accessible enough and so don’t have as much confidence in working with us as they should.

I’m specifically thinking of a guy I have worked with for several years in a technical capacity. He’s brilliant, but I always felt like I was second-tier in his book because he was unresponsive to emails and phone calls. I’d voicemail and email several times and get no reply at all, even in the middle of a project. That obviously made me uncomfortable about working with him.

So we had a talk in the middle of a current project. Turns out that a/email is his preferred method of communication, so if you leave a voicemail he’s likely to respond by email and b/he was having some terrible problems with his email provider and ingoing and outgoing messages were simply disappearing without a trace.

He’s now changed email providers and is suddenly very accessible, sending me reports and checking in several times a week. My confidence in working with him has gone up exponentially though the service provided has not changed. Virtual relationships need to be maintained the same as physical ones.

I love my Timbuk2 briefcase/messenger bag. It is nice that it is a San Francisco company with street cred that is good to its people. (A couple years ago, when they made more money than they expected, they distributed it to their piece goods workers… you don’t see that every day.) And I like even more that my orange bag is still intact after 2 years of heavy use. So, when I broke the buckle on the strap that holds it around your waist when you are riding a bike, I had to fix it.

I found the replacement piece on their website and ordered it. Got a cutesy email confirmation and then the piece arrived and it didn’t fit. That’s when the good stuff began. I replied to the cutesy email from customerservice@timbuk2.com and immediately got a reply from a real person, Ann H. She said, “I understand what you are talking about and I will look down in production for one for you.” Pretty impressive but what comes next was even better. She couldn’t find it and asked me to send a picture. The picture didn’t match so she wrote back, “Is it the cross strap or is it a waist belt? I can send you a whole new one if I know which one.”

And so she did. Turns out the buckle style had been changed (that’s why she couldn’t find it) but I just snapped off the old belt, put in the new one, and was good to go. And as Ann H said in a follow up email, “I am so happy to hear this. We do not want you to have an unhappy bag just sitting in the corner being neglected.”

Ann H may be one of a kind. But what’s reproducible and instructive about this is having my email go to a real live person, when I hit the reply button on my confirmation email. How many times have you done that and get a bounceback because the email address won’t accept incoming mail? What are they worried about? It’s logical that people would want to reply to an email from the company if they need further service, so why not let them do it… vs sending them to some kind of online form that may reduce the number of incoming inquiries, but also has an effect on overall customer satisfaction and future orders.

We want to love the Discovery Channel Store. The shows are great, and by implication the stuff they sell should be good clean fun for kids. Unfortunately, much of it seems to fall apart at the slightest touch.

Last year my kid got a remote controlled airplane for Christmas from Discovery. It didn’t work. We took it back to the store and exchanged it for another which… also didn’t work. By this I mean that the mechanisms that communicate from a controller to the plane to its moving parts had some kind of disconnect. Finally, on the third try we got a plane that DID work and we succeeded in crashing it ourselves, end of RC airplane trauma.

Just now we’ve ordered again, thanks to a gift certificate. Specifically, RC Anthropods! Three bugs which scutter along as controlled by a twig with a battery hidden inside. But one of the bugs was missing its charger connector out of the box, and a second lost its connector (the thing that powers its internal battery, so it will move) as well as its scuttering wheels within 24 hours. It was at this point I contacted Discovery Online (the stores are all now closed) and asked for a refund.

As with the store experience last year, the reply was prompt and extremely polite: they’ve credited me with the full amount of the purchase and I don’t even have to return the defective toy. Of course, if they did this on every toy that was defective they might quickly shutter their online store too. Could it be their profit model to flood the market with evidently poor quality, but very cheap, product and hope that inertia keeps customers from asking for their money back?

The flaw with this is the difficulty of getting repeat business, which may be why the brick-and-mortar locations shut down (including one which had just opened in a pricey location at SF’s new Westfield Center). Right now the web store is heavily promoting—the RC Anthropods were yesterday’s special. Let’s see what happens after Christmas.. As my solicitious email from the customer service department concluded,

Thank you for shopping with us and LET’S ALL DISCOVER!