Are You Losing Loyal Clients Faster Than You Can Gain New Ones?

by Lisa on October 20, 2010

If you model some of the big name companies you can do just that.

I’ve noticed recently that there are an awful lot of well-known, successful companies that have established great reputations and huge client bases only to promptly forget that it’s those very clients who got them where they are today.

A prime example…

Glenn and I decided a couple of weeks ago to upgrade our phones to the new Droid X. I’d been getting emails from Verizon saying we qualified for an upgrade.

We pulled into the parking lot of the Verizon Wireless store to see two butts sitting on the front window sill inside the store. Glenn turns to me and says, “Uh oh…that can’t be a good sign.”

Sure enough it wasn’t. We walked in to see 15 + people milling around the store. The guy at the little desk by the door took our name and then blatantly lied to me when I asked how long the wait was. He replied, “15 minutes.” As I look around the store, I can’t help but wonder, “Does he really think I’m that stupid?”

Smart biz practice 101… If there’s a situation that’s so bad your employees have to lie about it in an attempt not to lose customers or embarrass themselves….FIX the problem! It’s not rocket science.

We wander over to check out the Droid X while we wait only to discover that they don’t have their most popular, most-hyped new phone on display in the store. Are you kidding me?!

Smart biz practice 101…make sure you make it easy for your clients/customers to check out your services and products.

Fifteen minutes come and go and not one name was called during that time. Clearly it was going to be a much longer wait than 15 minutes. Seeing as how my main reason for coming into the store rather than ordering online was to SEE the phone…we left to go in search of another Verizon Wireless store that might actually have the Droid X for us to look at.

Smart biz practice…when your clients want to hand you their hard earned money…be ready to take it! Do not make them wait ridiculous lengths of time.

Another 15 minutes and we’re at another Verizon Wireless outlet, only to be informed that while Glenn’s phone qualifies for an upgrade, mine does not…not for another three months.

In the past, if one of the phones on my plan was a few months from upgrade, they’d go ahead and upgrade both, assuming of course that we agreed to a new 24 month term.

Smart biz practice 101… Accommodate any reasonable request from a loyal or prospective client.

Not this time. I was informed that if I wanted the Droid X I’d have to pay the full retail price of $569.

If I were a new customer I could get the Droid X for $199. But as a loyal customer it would cost me $569?!

It was all I could do not to lose my cool completely. I think Glenn was afraid my head might explode from the barely contained frustration I was feeling.

“So what you’re telling me is that I’m being penalized for already being a customer,” I said as calmly as possible.

“Not at all.”

“Then there must be some way to make this work,” I replied.

“Well, if you add another line to your plan you can get the new Droid X for $199.”

OMG! Seriously?! So essentially everyone BUT loyal customers can get the Droid X for $199.

Smart biz practice 101: REWARD your long-term clients for their loyalty. Don’t penalize them. (How does that brilliant Ally bank commercial go? Oh yeah….even kids know it’s not fair to treat your new friends better than your old friends.)

It was then that I realized that it would be more affordable for me to cancel my plan, pay the $175 early termination fee, and then contract a new plan with which I could purchase the Droid X for…you got it…$199, for a total of $374 and a savings of $195.

Smart biz practice 101…NEVER set it up so that it makes more sense for your loyal clients to cancel your services.

Incredibly short-sighted of Verizon Wireless. Because here’s the thing…we didn’t have smartphones. So not only were we looking to upgrade the phones, but we’d need to add data plans to both phones and mobile broadband to mine so I could use it as a mobile hotspot. We’d have added approximately $100 per month to our bill. (Not to mention the $150+ I planned to spend on accessories.)

Smart biz practice 101…Never, ever, EVER make it difficult for a loyal client to spend MORE money with you.

I was now so frustrated, no, I’ll be honest…I was so freakin’ furious, that I couldn’t stand it another minute. I was outta there.

I came home and (surprise, surprise) immediately began researching other wireless services. I was so disgusted with my customer experience that I no longer wanted to be a customer.

Smart biz practice 101…the surest, the fastest, way to lose loyal clients is to piss them off and then clearly demonstrate that you couldn’t care less.

Unfortunately, I discovered that here in Trinidad, CO Verizon is still essentially the only viable option. I was stuck with them.

So I gave it a few days and then did some research to discover that while we couldn’t upgrade both phones at the discounted price we could transfer Glenn’s upgrade to my line. (Why on earth did no one tell me that before?!)

Smart biz practice 101…whenever possible anticipate the needs of your clients before they do.

So I decided to support the locally owned Verizon Wireless outlet here in Trinidad, by purchasing the phone with them. But would you believe? They didn’t have the Droid X in stock. Neither did the outlet in Trinidad’s little sister town, Raton.

Smart biz practice 101…if you’re going to do a big marketing push for a particular item and you want to actually benefit financially from it…keep the item stocked.

At this point, I’m dumbfounded at how incredibly hard Verizon is making it for me to do what should have been beyond simple…upgrade my phone.

I went back to ordering it online but, of course, there was no way to indicate I wanted to transfer the upgrade to my line. So I called and was assured it was easy. Just order the phone online, I was told and when it arrives, call again and we’ll activate it on your line. Sounded easy enough. Sadly it wasn’t that simple and involved having to activate it on Glenn’s line first, then transfer it to my line, then re-activate Glenn’s.

Another 30 minutes later and I finally had my new Droid X activated on the right line.

(At this point I’m thinking…you have to actively work to make something this freakin’ difficult.)

But the frustration is not yet over…to top it all off, the $100 rebate form they sent with the phone (it’s actually $299 with a $100 mail-in rebate) was for the wrong model, and Verizon won’t pay the rebate unless the right form is used, which meant that I now had to go in search of the rebate form.

I don’t like the concept of mail-in rebates in the first place as they’re designed as such knowing that there’s a good chance you won’t do what you need to do to claim it in time.

Smart biz practice 101…don’t make your clients jump through hoops. Want to give them a fabulous discount? Just do it.

I wouldn’t be the least bit surprised, all things considered (Verizon Wireless was just nailed for padding the bills of millions of their customers with $1.99 data plan charges they didn’t incur), if Verizon routinely includes the wrong form in deliveries to make it that much more difficult to claim your rebate.

Smart biz practice 101…never sacrifice your own or your brand’s integrity to make a buck…it’ll come back to bite you in the ass in the long run.

I lusted after the Droid X because it just looked too damn cool and I am a HUGE fan of google….google search, google apps for biz: mail, docs, analytics etc, google tasks and calendar…and the prospect of being able to sync all of that with my phone and have it more mobile…was more than I could resist.

Smart biz practice 101….be very, VERY careful who you associate yourself and your brand with. Your choice will elevate the public’s perception of you and your brand or have you desperately scrambling to salvage your reputation.

This is a prime example of what I was saying in my last post about how it’s not enough to simply deliver a great service or product. It’s the overall customer experience that really matters.

If I could have dumped Verizon I’d have done it in a heartbeat after the poor customer experience we had, and you can bet…when I have other options I’ll be exercising them.

Verizon Wireless could really take a lesson or two or three from Whole Foods.

Underlying all these “smart biz practices” is a principle Verizon Wireless would do well to remember:

To reach the levels of success you strive for, and to maintain your success once you’ve achieved it you must NEVER forget, or become too busy or greedy to care about the clients that made it all possible.

What could you be doing differently to insure an amazing customer experience? How do you (or could you) reward your loyal clients? I’d love to hear your ideas and thoughts in the comments.

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{ 7 comments… read them below or add one }

Kimberly November 10, 2010 at 11:55 am

Wow…that sucks! Royally! But I hate to say it, AT&T is no better. These large companies really don’t get it, do they?

Reply

Michelle November 18, 2010 at 4:18 pm

They don’t, and it seems like they never will. Phone companies have been operating like this for as long as I can remember and they get away with it for so many reasons. They definitely serve as a shining example of how not to run your small business, though! :D

Reply

Lisa November 18, 2010 at 4:27 pm

Yeah, right? ;)

Sometimes an example of what NOT to do can be every bit as powerful as one that demonstrates what TO do.

It’s obvious to me, Michelle, that you’re damn good at what you do and that you really “get” what it means to deliver a superior customer experience. It was such a treat to meet you.

Warmly,
Lisa

Reply

Laree' Griffith November 18, 2010 at 5:19 am

I loved this article, what an eye opener! You know I’ve felt this same tone in restaurants, bookstores, banks and every other brick and mortar business, aside from the restaurant, I wonder if this lack of service in brick and mortar shops has to do with them leaning to heavily on their online resources.

The reason I say this is that often in my own job working with Customs and Freight Forwarders is that it is often the first thing out of their mouths….”did you check our website for status”, “If you go to our website theirs a great Q&A that might be able to answer that for you.” It seems that often those in service are so anxious to pawn you off to their website so they don’t have to do any work. Don’t get me wrong, websites are awesome and every business should have them….but they should not take the place or excuse a business from giving spectacular one on one in person service!

As for restaurants I cannot use that as an example.

I did enjoy the absolute joy of witnessing the owner of a fine Italian restaurant come in at Happy Hour, take off his coat and go around and shake hands with everyone in the facility, he was not offering anything but simply saying “Hi, how is your night going, I’m Gusissepe, and you are… ” I’ll never forget that and often talk about this business owner for that small simple gesture. Yes, he does have a website, if your on his mailing list you get cool little newsletters about his Wine and Dinner specials that are related to different provinces in Italy-or his Mother’s Day Special…etc.

It is so refreshing when a business does care about it’s service and customers, really it’s amazing now days and I cherish it, every time I run across such a business.

Thanks Lisa for this eye-opener!

Reply

Lisa November 18, 2010 at 4:34 pm

Hey Laree!

It’s a shame isn’t it? Not to mention short-sighted. Because the reality is…in this day and age…there are so many options and alternatives available to the consumer that businesses really can’t afford to assume they’ve “arrived” and no longer need to go the extra mile.

On the flip side…I love to hear stories like yours of the owner of the Italian restaurant so warmly and genuinely greeting and interacting with his customers. It’s businesses like those that serve as inspiration for all of us and that deserve our continued support.

xo
L

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christine negroni May 4, 2011 at 5:57 pm

We have had Sprint for many years and on occasion have needed the company to accommodate some issue or another. The company has always been great about that, right down to replacing my Treo with another smart phone even though the phone was at least 4 years old. This kind of treatment guarentees that we’ll remain loyal Sprint customers. They’re doing it right and could certainly teach Verizon about how to keep customers happy.

Reply

Lisa May 4, 2011 at 6:08 pm

Hey Christine!

Yes, it sounds as though Verizon could learn a thing or two from Sprint. Good to know you’ve had such a positive experience with them. As it happens, I’ll be moving closer to civilization again in the next month or two, at which point I’ll have additional options and you can bet I’ll be making some changes. ; )

Thanks so much for taking the time to comment.

Warmly,
Lisa

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