The $199 Palm Pre that’s Really $299
Customer Service, Misc May 19th, 2009
…And I am not even talking about TCO, calculating life-time cost with subscription. No, just plain simply purchase price, with a dirty industry trick: rebates.
The long expected Palm Pre will be available from Spring on Jun 6th, at $199 with qualifying data plan, and after a $100 rebate. And therein lies the rub – it will cost $299 for many.
Fellow Enterprise Irregular Winnie Mirchandani has a long-going series on business processes that badly need “angioplasty“. Processing rebates is certainly a most convoluted process – unfortunately often by design. Why? It’s simple, 40% of rebates never get redeemed, says Business Week:
The industry’s open secret is that fully 40% of all rebates never get redeemed because consumers fail to apply for them or their applications are rejected, estimates Peter S. Kastner, a director of consulting firm Vericours Inc. That translates into more than $2 billion of extra revenue for retailers and their suppliers each year. What rebates do is get consumers to focus on the discounted price of a product, then buy it at full price. "The game is obviously that anything less than 100% redemption is free money," says Paula Rosenblum, director of retail research at consulting firm Aberdeen Group Inc.
What this old article fails to point out is that it’s often not the consumer’s fault who forget to send in rebates. Sure, we’re sometimes lazy to do the paperwork for a $5 discount, but you would dot it for $100, wouldn’t you? Yet it’s often the ugliness of the rebate process with built-in traps (did you cut out the UPC code from the right corner on the box, did you circle the right amount..etc), or just the ignorance of the rebate processing company (yes, that is a thriving business in itself) that robs you of your rebate check. And don’t for a minute think it’s only from Tiger Direct and other retailers who thrive on the rebate-scam. Brand-name trusted vendors aren’t any better. Since we’re discussing the Palm here, here’s my rebate experience from Handspring (the former Pal-spinoff that later reunited with the parent) from a few years ago:
Sent in not only paperwork, but an actual, working older Palm III as trade-in unit (This condition was so ridiculous, later Handspring changed it to providing serial no’s of the trade-ins.) The $100 rebate never arrived, not even after numerous phone-calls and emails. They demanded copies of everything, which I sent – but how do you copy the trade-in unit? My loss: $100 rebate, $50 trade-in value for the old Palm (that’s what it sold on eBay at the time), postage and about a full day of my time fighting the bureaucracy.
Did that stop my from buying Handspring / Palm products? Not when they were the only game in time, so I bought two more Treo’s. But guess what: Palms are not the only choice if you want a smart phone, and obviously I am still not a Palm-fan…
Back to the angioplasty, one way to streamline rebate processing is to make it an all-online process, removing the intentional hurdles. I can’t see why in the 21st century this is such a big deal. Costco sets a positive example, with simple online rebate entry, prompt payment, and online audit available for years.
But the real angioplasty would be to kill the the whole process. Forget rebates, it’s time for true transparency: call it what it is, $299 or $199, if you want to promote your product, provide a temporary discount, but forget rebates, which are just a Big Fat Lie.
(Cross-posted from CloudAve. To stay abreast of news, analysis and just plain opinion on Cloud Computing, SaaS, Business grab the CloudAve Feed here.)
Tags: angioplasty, business process, customer disservice, Customer Service, deception, handsrping, palm, palm pre, process angioplasty, rebate, rebates, retail, smartphones, treo
Spirit (-less) Airlines Charges Flight 1549 Survivors Cancellation Fee
Customer Service January 19th, 2009
Ouch, this airline badly needs Customer Service training.
Spirit Airlines is trying to charge passengers extra fees after canceling a flight, which forced the passengers to be on the plane that landed in the river Thursday.
Rob and Jeff Kolodjay were scheduled to fly on Spirit Airlines to a golf vacation with four other friends on Thursday out of LaGuardia in New York City. Their flight got cancelled, and they were rebooked on to US Airways flight 1549.
While the Kolodjay’s have good things to say about US Airways, they are less pleased about the policies of their original carrier. When they tried to cancel the return tickets on Spirit they could not use because they never made it to Myrtle Beach, the company representative insisted on charging them a cancellation fee.
Source: Fox61, Consumerist, and soon all media outlets. I doubt Spirit has even a clue about the magnitude of the PR Nighmare they are getting into…
Update: The story is making the rounds. Her’s an interesting reaction:
You know, in some cultures the response to this would be to lock the customer service representative in a room with a gun and expect him to do the honorable thing. I’m not saying that this is the right solution – but it’s probably the one that Spirit Airlines might end up wishing that it could pursue…
(Photo Credit: CrunchGear)
Update: Somebody who thinks woke up @ Spirit, reversing the earlier decision:
Spirit Airlines has given the Kolodjay family a full refund and have issued credits to their credit cards. They will not be charged anything by Spirit Airlines.. We applaud everyone involved in bringing these passengers to safety wish the family the best.
Tags: airline charges, airline crash, Customer Service, flight 1549, hudson river crash, pr, PR fiasco, pr nightmare, spirit airlines, us airways
Is Tivo Selling Out Their Customers?
Customer Service, Marketing / PR December 10th, 2008
Zat’s Not Funny reports that Tivo is getting ready to push advertisements whenever you hit Pause on your remote.
Using the TiVo Pause Menu, advertisers can, for the first time, reach audiences with targeted product messages displayed within the pause screen of a Live or Timeshifted program. The feature provides an original solution for advertisers seeking to capture the fast-forwarding viewer. It’s another example of how TiVo offers unique and different solutions for advertisers looking to get viewers to watch advertisements.
Another example of offering solutions to whom? Certainly not their customers.
Tags: ads, advertising, business model, Customer Focus, dvr, marketing, television, tivo, tv
Belgian Chocolate Online: Chocolaty Sweet Tale of How Poor Service Really Hurts Business
Blogging, Customer Service July 14th, 2008
Perhaps it all started with Jeff Jarvis’s Dell Hell. Simple story: famous blogger gets poor service > blogs about it > company faces media backlash > company wakes up to social media, turns around > eventually Jarvis praises them as a Cluetrain business.
Then there’s Comcast: everyone’s love-to-hate cable company that now actively monitors Twitter for customer complaints in an effort to improve both their image and customer service. These companies know something that many others still ignore:
Times have changed. Using blogs, Twitter, social networks one single unhappy customer can make a business look really bad. Poor service is bad PR, which is very costly to undo. Good Customer Service is great marketing.
Now here’s my story of an online retailer that’s about to learn these rules.
My Dad has diabetes, and he likes chocolate – not a good combo.
There’s hardly any choice in sugar-free chocolate, what’s available locally tastes like **** and is overpriced. Eventually I found two (only !) online sources that sell Milka, his favorite brand. I ended up ordering from Belgian Chocolate Online, (www.chocolat.com, www.chocolatesimports.com) owned buy CandyWorld, USA. The site claims they ship the day after the order is placed, yet mine was only sent 9 days later, after I inquired. The delay was actually reasonable, due to a heat-wave, but shouldn’t they notify customers?
But the real surprise came a week later, when I received a large box of almost-expired chocolate. True, it had a few weeks left, but given the economics of shipping, I bought 40 bars, i.e. 4 kilos, or close to 9 lbs. I don’t know about you, but my Dad certainly does not eat that much in 4 weeks…
Two of my email complaints were left unanswered, so a week later, by the third email I was a bit antsy:
Dear Customer Service,
I don’t get it. Is your solution to Customer Service issues to not respond at all? I’d like to know if you intend to replace the old product with fresh one, or send refund. This is my last request, if you continue to ignore me, I will pursue this on my own.
Finally they answered (emphasis mine):
Dear Customer:
We are not ignoring any emails. We are helping customers placing their orders or who really need customer’s service. We can’t help you in an expiration date problem that you do not like and which isn’t a problem.
The chocolates you bought are still not expired and we do not see why to replace or to refund. The expiration date is not the date for consumption, but a date to sell. We do NOT sell any chocolates with an expired date.
Ouch! Who really need customer service… I’ve just spent $130 on old product and I don’t qualify for attention. Expiration date is not a problem… although this obviously sounded baloney, I wanted confirmation, so I contacted Kraft Foods, Milka’s parent company, who responded within a day:
The product should be consumed by this date. We cannot assure freshness after that date because the taste and texture may have deteriorated.
(Side comment: talk about the power of brands … yes, Milka is a popular brand in Europe, and Milka is owned by Kraft, by can you imagine asking for Kraft Chocolate?
)
Anyway, I am confirmed to be right about the expiry date, and Belgian Chocolate Online’s attempt to explain the problem was a lie . They were right in one point though: technically, they did not sell expired chocolate. Not until one day before expiry … then good luck trying to eat it all quickly. It is common practice by groceries to deep-discount perishable goods a few weeks/months before expiry, and one can even find Milka chocolate on eBay at a fraction of the original price – but eBay sellers disclose the shortened shelf-life, for fear of eBay ruling against them in a dispute. I guess there is no such policing on the Wild, Wild Web.
Except… now every consumer has the means to get “noisy” about their problems. I am no Jeff Jarvis, but CandyWorld USA is no Dell, either: I wouldn’t be surprised to see this post on the first page of several relevant Google searches (see update), and believe me, that will cost them a lot more than it would have cost to keep me happy. Of course not everyone has a moderately well-read blog, but just about anyone can make noise on Twitter, and Get Satisfaction is another great resource to vent and get service.
In fact a combination of Twitter and Get Satisfaction was what brought me Comcast help a few months ago. The attention I received from Comcast Executives from Philadelphia and here in California was quite amazing. Comcast is becoming a hero for listening to customers on Twitter, and others follow. Southwest Airlines now even has a Chief Twitter Officer.
Are these examples PR acts or real customers service? The individual complaints are resolved, for the customers involved, it’s real service. But Twitter or not, the “loud” unhappy customers are still just a fraction for now – which is why companies can afford to go out of their way to satisfy them.
I trust that simple market mechanisms will force companies -large and small- to improve service in the long run. The economics are simple:
- The PR damage (and potential loss of sales) caused by “noisy” individuals far exceeds the cost of helping them, so companies pull resources to put out these fires.
- Yet firefighting is costly, may work with dozens, hundreds of customers, but not all.
- Companies will reach a tipping point, where all the after-the-fact firefighting will become so costly, that it will actually be cheaper to train their support personnel and provide better service in the first place, thus the Twitter-heroism will decline.
We’ll all be better off after #3. 
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- How to give Feedback to brands using Social Software
- This Time, a Chocolate Retailer Demonstrates Why You Cannot Botch Service in the Age of Social Media
Update: Just as exptected: a few hours later this post is on the first page if you search for Belgian Chocolate Online, and comes up first, before the vendor if you search for sugar-free Milka, which is how I found them in the first place.
Update (9/16): Following the trail from my blog referrer log I’ve just discovered this post is now #1 on Google for the “milka chocolate marketing” search. Oops… that can’t be good – for Milka.
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Tags: belgian chocolate, candyworld, chocolat.com, chocolate, chocolatesimports.com, comcast, customer disservice, Customer Service, diabetic chocolate, diabetic milka, getsatisfaction.com, kraft foods, marketing, milka, online candy, online chocolate, southwest airlines, sugar-free chocolate, sugar-free milka, swiss chocolate, Twitter, word-of-mouth
UPS: Tracking and Customer Service Failure
Customer Service July 7th, 2008
Image via WikipediaRecently I ranted about UPS’s delays and customer service level – oh, boy, little did I know then just how bad UPS Customer Service can really get.
Four out of five packages I dropped off at the same UPS store a 2 weeks ago still showed “Billing Information Received” status a week later. In UPS lingo this means the shipping label was created, but the package was never received by the company. There’s nothing to track, as far as UPS is concerned, the package really doesn’t exist. This was what the Customer Service agent repeatedly told me anyway, further explaining that the only way this could have happened if I either did not send the packages at all, or did not properly attach the labels.
Of course she did not have an explanation on how the fifth package safely arrived in the meantime – after all, I did not dropped them off at UPS according to her theory. If it’s not in the system, it doesn’t exist. Only when I asked her if she was accusing me of lying did she change tone, and recommended we put a tracer on the lost packages. Since these were returns to ShoeBuy using their return labels, they were considered the shipper, not me, so they had to initiate the trace.
ShoeBuy is a company with amazingly good Customer Service – since Zappos is often referred to as to epitome of Customer Service, let’s just say ShoeBuy is like Zappos, often with lower prices. They picked up my email immediately, and they probably carry some weight with UPS, since the non-existent packages were found in no time. The tracking information below tells the whole story:
The packages never entered UPS’s tracking system, there’s no sign whatsoever that I ever sent them from California, yet they miraculously showed up at the destination, ready for delivery upon ShoeBuy’s inquiry. So much for the rock-solid tracking system…I understand the first step, i.e a UPS store clerk forgetting to scan the received packages, which then got loaded on the truck anyway, but how were 4 packages then able to bypass all further stages of scanning?
But let’s finish this post on a positive note: it’s a story of good Customer Service, after all – just not by UPS. ShoeBuy, upon finding what happened, immediately refunded my money, before they even received the packages from UPS. Wow! They know something about keeping customers happy.
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Tags: customer disservice, Customer Service, shoebuy, tracking, UPS, upssucks, zappos
Virtualinvoice: Time To Fight Back
Customer Service, Humor, Misc July 1st, 2008
There are two types of computer users:
- The problem-solving techno-geeks who build hardware, hack software and enjoy every challenge, even bugs to dug themselves get deeper an deeper in… most of us have probably been there, done that, then grew up.
- Those who simply want to use their systems for work, fun or whatever they damn please, and hate when they are forced to spend hours investigating problems that should not occur in the first place, and then they should be documented… I suspect that’s the majority of us. A few hours here, half a day there, always in the worst possible time. We feel it’s unfair that we are forced to work instead of [insert your favorite lousy company here]. After all, wear not on their payroll.
Enough is enough. Let’s fight back! If you’re a freelancer, or are in any profession where you bill your hourly, you know exactly what your rate is. Even if not, chances are you have a realistic estimate of your time’s worth. Next time you feel you got robbed of a few valuable hours, just bill it! Chances are, you won’t get paid, but you’ll feel better. I certainly do, having just billed Microsoft, Mozilla and HP.
Remember to tag your invoice / blog post.. whatever as virtualinvoice: I will keep tab of the totals, and periodically publish them.
Viva La Revolucion! 
Update: It looks like Bob Warfield is should send a Virtual Invoice about now …
Tags: customet support, technical support, virtualinvoice, zoho invoice
UPS: Delays and Customer Service
Business, Customer Service June 30th, 2008
I’m expecting a package that was due for delivery today. Here’s the UPS tracking info:
Let me get this straight: the package was here in California, 42 miles from my home yesterday at 8am. Apparently the train was late, but who cares, it was here yesterday morning, will sure make to my place today? Nope, a day later it’s still in San Pablo and it’s being rescheduled for delivery tomorrow.
Today it will make it all the way to the UPS center in San Ramon, a 30-mile trip, and just 12 miles from my house. Then tomorrow afternoon it will finally get here – 42 miles in 3 days.
Now, I can already hear the arguments about logistics optimization. My package may just have missed the early morning pick-up and that was the last one for the day. But isn’t timely delivery, and consequently customer satisfaction worth scheduling an additional pick-up in case a train is late?
It gets worse. In this case UPS simply did not go the extra mile to make up for the train delay. But I’ve seen cases when the package arrived to San Ramon a day earlier than scheduled, yet it did not make it on the truck the next morning. UPS would rather store it an extra day at their facility than deliver a day early. Forget customer satisfaction, this is all about market segmentation and protection. They will have to make sure a 7-day delivery is indeed 7 days and not any faster, otherwise they might just reduce their customers’ inclination to pay for faster delivery methods.
Update (7/1): Oh, boy, when I wrote this, I had no clue just how bad UPS Customer Service can really get…
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Tags: customer satisfaction, Customer Service, package delivery, UPS
I don’t know why I haven’t killed HP Total Care Advisor yet, but today I accidentally clicked on it:
Wow. I’ve seen crapware .. but never before have I seen a vendor with the audacity to place their shopping program under Critical Alerts. Shame, shame, absolute shame, HP. 
Tags: Customer support, hewlett-packard, HP, hp total care, technical support
Windows Live FolderShare No Longer Strictly P2P?
Customer Service, Personal Productivity, SaaS June 16th, 2008
Foldershare is a life-saver: a peer-to-peer file synchronization product that does its magic in discreetly in the background, with the user barely noticing it even exists. While it needs to log in to the MS servers, it does NOT sync / upload actual data, all synchronization is strictly P2P. In fact one of the setup options is to define whether you allow remote P2P sync to occur through the Net, or strictly on your LAN, behind the firewall.
I’ve been using it for years now, as part of my data sync and backup strategy: I let FolderShare synchronize data between two laptops and a desktop, then I use the desktop as the “master” which will back up data online to Mozy, the other life-saver.
Of course using two products for somewhat similar purposes is redundant, and I have previously speculated that Microsoft should tie Foldershare and Skydrive (Live Mesh, Live Drive – pick your favorite buzzword) offering both PC sync and Web backup. I wonder if it’s about to happen.
I noticed this weekend that my computers could sync without them being online at the same time – which is (used to be? ) a primary requirement for FolderShare to work. Now I could repeatedly test turning off all but one computer, update files on the one with FolderShare running, then shut down FolderShare, start another machine, and voila! – my changes got synchronized. How was that possible when it had nowhere to get the information from, other than the Microsoft servers? (unless the closed program left behind a process running, other than Foldershare.exe)
If this means FolderShare is no longer strictly a P2P product, I actually welcome that change – except for the fact that it happened unannounced. Leaving users in the belief they are only sync-ing data between their own computers when in fact it’ stored on Microsoft’s servers would be a serious violation of their privacy.
Interesting coincidence (is it?): FolderShare will have a planned outage of 48-72 hours this week. 72 hours (3 days!) is a lot of time, it should be enough for major changes. In fact more than enough – such outage would be unacceptable from any service provider – except apparently from Microsoft. (Yes, I know, we get what we pay for, and this is a free service – it’s still a ridiculous outage.)
Update: Further testing reveals that the actual data files are not transferred between offline computers, only the *.p2p placeholder files. Sigh of relief: your data files are not stored on Microsoft’s servers. BUT …. BUT: the index is indeed stored centrally. This did not appear to be the case with the original FolderShare by ByteTaxi, prior to the MS acquisition. I don’t know when it changed, and I don’t recall being warned about it. The former FolderShare user agreement page disappeared and I haven’t found any updated information on FolderShare’s site.
Update (6/24):
Ouch! C’mon guys, this is so simple, even I could fix it.
Tags: cloud computing, foldershare, live mesh, microsoft, On-Demand, SaaS, windows live
Airline Special Calendar
Customer Service, Misc June 6th, 2008
When I lived on the East Coast and flew US Airways (back than just USAir) a lot, we just called it Useless Air. Today I received an email from Useless Air trying to get me buy back the miles I lost:
Our records indicated that 19,560 miles were forfeited on 12-01-2007 because your last activity date 05-19-2006 was more than 24 months ago.
May 2006 to December 2007 is more than 24 months on Useless Air’s calendar. Thank God I am not aging according to their schedule.
Tags: air miles, customer disservice, frequent flyer, us airways, usair, useless air
Zoli Erdos
