Daily Archives: June 10, 2011

Story of a Lost Customer – Lessons for Brand Engagement

Last year I switched to a new land-line telephone service provider.  For years I was overpaying with my previous telco.  Over an 18 year period, I reckon I’ve spent at least $36,000 with this company.   Finally, one day I called customer service and asked them why they were overcharging me when lower rates are available.  The terse response was that the rates are publicly posted and that it was the customer’s responsibility to switch plans if the one they had did not serve them well.  To adjust injury to insult, the tone of the call center agent was plain rude.

There is no doubt consumers have to be vigilant and ensure that their interest is protected at all times.  In this case the business did not do anything illegal.  But they sure didn’t look out for the customer’s best interest either.  Isn’t there a moral responsibility? What if companies operated with a different mindset?  What if they also looked out for the customers’ best interest, at least once in a while?

The company could have handled such a profitable customer in a couple of different ways.  They could have automatically switched me to lower rate and then informed me that this is their way of appreciating my business relationship with them.  Alternatively, they could have called me or written to me and proposed that I switch to a lower rate to save money.  I would have been delighted at such a call/letter.  Such communication would have presented them a great opportunity to sell me another service.  Delighted by their service, I probably would have fallen for their sales pitch.  Instead, they chose to do nothing.

If they had taken the aforementioned steps, they may have lost a little bit on my monthly bill, but I sure would have stayed with them.  Their proactive approach to saving me money, would have been worthy of blog posts and tweets.  I would have spoken about it to not only friends and family, but to my students and business associates.  I might have considered using this as a positive example in my professional writing and speeches.  Such endorsement and word-of-mouth has real value.

First they lost residential account.  They lost the opportunity to sell me a bundle of other telecommunication and entertainment services.  Then, when I needed a business line, I chose a competitor.  I should have been a brand ambassador.  Instead, I am a brand detractor.  I felt that I was taken advantage of.  Their single focus was on the high margins I afforded them.  My long-term value (from my own spending with them and the value of WoM I can provide them) was unimportant to them.

A couple of weeks after I left them, I received a standard card from the company, signed by a VP, expressing regret that I had left them and wanting my business back.  It sounded very insincere.

What is my advise to companies, based on my personal story?

  1. Treat customers fairly.  That’s the sure way to build brand reputation.
  2. Ensure every employee is trained to treat customers with respect and courtesy.  Every touchpoint and interaction with the company should create a positive impression, even if the customer’s demands are not always met.
  3. Don’t focus just on short-term profits always.  Consider the long-term value (direct and indirect) of retaining happy customers.  In an earlier post titled Select, Not Fire Customers, I talked about Sprint firing some of its “unprofitable” customers.  But too often, it is profitable customers who leave because they don’t like the way they are treated.
  4. Proactively manage customers, especially the profitable ones.  Some degree of churn is inevitable.  But there is little to be gained by losing profitable customer due to neglect.
  5. Don’t use brand engagement and customer experience as buzzwords.  If you really want to create strong brand engagement focus on delivering superior customer experience.  Often, a fundamental shift in management’s attitude is needed.  In many cases, changes to compensation plans are needed to ensure customer satisfaction and experience get the requisite attention.
  6. Last, but not least, look at the damage caused when you ignore the above five recommendations.  The negative sentiment that is expressed by unhappy/former customers can’t really help the brand.  Positive sentiment in today’s social media world cannot be manufactured.  Positive sentiment occurs when companies show customers that they really care.