Consumer Watch - Richard J. Dalton Jr.

Norma Freedman received notification in May that a movie from the Columbia House mail-order DVD company would be sent, but she didn’t receive the usual code used to cancel the order. So she did what many people would do: She called the company.

And, like many consumers calling a customer-service number, she reached an automated service that couldn’t resolve her problem and wouldn’t provide a agent.

That inability to reach a live representative is one of the top complaints of consumers calling customer-service centers, according to experts and surveys of the customer-service industry.

And the problem is becoming increasingly common as companies try to divert callers to their Web sites or provide more services via voice-response systems to save money, experts said.

“Making it hard to talk to an agent really hurts companies in their satisfaction ratings,” said Peter Leppik, co-founder and chief executive of Vocal Laboratories, a Minneapolis company that surveys people after customers place a service call. “But the reason why they do it is that talking to an agent is expensive and using automation is cheap.”

While touch-tone services, which prompt customers to press a button on a phone, can provide only a limited menu of services, companies are increasingly adding voice-response systems, which allow callers to respond verbally.

A recent study by Forrester Research, a market research company in Cambridge, Mass., found that 28 percent of companies have voice-response systems or are rolling them out, and 22 percent are evaluating such systems.

But customer-service calls to cellular phone companies handled by a computerized automated phone system receive significantly lower ratings than those handled by a live representative, according to a recent survey by J.D. Power and Associates, a Westlake Village, Calif., company that conducts market research and measures customer satisfaction.

Experts said good automated systems that have simple menus and allow customers to reach an agent receive good ratings from customers. But many systems have complicated menus, use industry jargon and require customers to enter information multiple times, only to repeat the information if they do reach a live agent, Leppik said.

So while voice-response systems can handle a large variety of queries, such as a change-of-address request, companies should still allow callers to reach a human, said Jonathan Brookner, director of certification programs for J.D. Power.

“It can be a devil or an angel, depending on how it’s used,” he said, adding that companies shouldn’t let customers “get trapped in a voice-response system that they can’t get out of.”

In June, Columbia House, part of Direct Group North America based in Manhattan, changed its policy, allowing those with an account number to reach a live representative, spokeswoman Paula Batson said.

“Columbia House is always seeking ways to improve communication with our customers,” she said.

Freedman, who said Columbia House resolved the problems with her DVD order, said she is pleased she’ll be able to speak to an agent in future calls.

St. Albans resident Elizabeth Gittens, 43, said automated services work fine for simple requests, such as checking a bank account balance. But after a truck recently knocked down telephone lines in front of her home, she said, Verizon’s automated system for phone repair didn’t provide assistance.

Heather Wilner, a spokeswoman for Verizon, said the automated system had recorded a repair request when Gittens initially called. Gittens said she wasn’t aware that the system actually processed her request. And after she reached a representative three days following the incident, Verizon fixed the service within two hours.

Michael Skudin, 63, a handyman in Levittown, said some companies make it especially difficult for customers to cancel a service via their automated service.

When he called to cancel Sprint Nextel cellular service within the 30-day cancellation period, he said, the automated service disconnected his call. Incredulous, Skudin tried twice more — and said he was disconnected both times.

“They have wonderful ways of not letting you get through to cancel their service,” Skudin said. “They’re very quick to say, ‘We’ll give you a contract and you have 30 days to change your mind,’ but they make it so aggravating \[to cancel\], some of these people will just say, ‘I’ll keep it. It’s not worth the effort.’”

Sprint spokesman Richard Pesce said, “We are continually working to improve customer service, so that we can quickly and effectively answer their questions, resolve issues and increase the value customers receive.”

Some Web sites have come to the rescue of frustrated consumers. One new service is 321calllog.com, which records conversations with customer-service representatives.

Carol Kelty, 56, an administrative assistant at Chimes Real Estate in Flushing, said she’d appreciate such a service. After she canceled DirecTV within the 30-day cancellation period, the company said she hadn’t done so, she said.

But Kelty had saved a copy of her e-mail request. When she faxed a printout of it, the company agreed to refund about $100 in fees, she said.

“I think it would probably be very useful for people who are in a jam,” she said of 321calllog.com. “If you don’t have proof that you canceled it or tried to cancel it, it’s your word against theirs.”

Another site, gethuman.com, indicates how callers can reach live representatives: by listing the digits to enter on a touch-tone phone, or the phrases the customer can say.

Some companies don’t make it easy. To reach a live representative at Humana’s pharmacy, gethuman.com instructs callers to provide an identification number that turns out to be invalid.

To get an agent at Northwest Airlines WorldPerks, callers must say “WorldPerks,” “agent,” “yes,” “agent” and another “yes,” according to gethuman.com. Some voice-response systems might not grant a request for an “operator” because the computer expects the caller to say “agent,” but customers might not know that’s the word they must use, said Elizabeth Herrell, an analyst at Forrester Research.

“I know one tricky company that, in order to get to an operator, you have to know to say ‘representative’ three times in a row,” she said. “Companies want to force you to use the automated service, but if the automated service cannot accommodate your specific needs, you should get an avenue out of there.”

Ask an Expert: Word travels fast, so handle complaints quickly - Steve Strauss, Special for USA TODAY

Q: Normally I take customer complaints in stride, but I recently received a complaint that I thought was fairly ridiculous and basically told the customer so. Boy is this a different era! Instead of telling one or two people that he thought I was a jerk, he posted it online and now people are blogging negatively about me and my business. How can I avoid this in the future without always rolling over? — Steve

A: You make a really good point, and I feel your pain, brother! The fact is, for all of us, in this era of increased transparency and viral networking, the stakes have been raised. Today, between personal websites, the so-called blogosphere, chat boards, instant polls, insta-feedback, and so on, ideas travel seemingly at the speed of light. This is especially true when it comes to problems with, and complaints about, your business. Acting like an analogue player in this digital world is a mistake that can kill your business. It is indeed true that in the PI era (pre-Internet), reputations and brands were created far more slowly, and unless yours was a national business or product that got national coverage, it was far more difficult to change people’s impressions of you one way or the other (tainted Tylenol for example). Today if you blow it, it’s not a handful of people who will hear about it, but one or two hundred, or thousand, or. .. . Yep, the stakes have been raised. But the reason to handle customer complaints well goes far beyond being slammed in someone’s blog. Consider just the financial impact of a single complaint. I have heard many times that for every one complaint about your business, there are six other customers who are equally unhappy, but who did not complain. So that is seven unhappy people in total. And, according to a study by Technical Assistance Research Programs (TARP), customers with negative experiences of your business likely tell twice as many people than those with positive experiences. It is estimated that the average disappointed customer tells 9 or 10 people about their bad experience (Note: This represents actual, real-world “gossiping”, not online postings). Seven unhappy campers times 9 told friend equals 63 people who will have a negative impression of your business. How many of those 63 will not patronize your business? A conservative estimate is at least 25%, but probably much more. If your product costs, say, $100, then that single complaint equals at least $1,500 in lost revenue. What does that number equal if the complaint is spread online? Your guess is as good as mine, but it isn’t pretty. The good news here is that plenty can be done to fend-off the real and virtual geometric unhappiness:

•Deal with it. It is also said that of those who do lodge a complaint, fully 70% will do business with you again if you resolve the complaint satisfactorily, and that number jumps to 95% if the happy resolution is prompt.

•Make the customer happy. No, I am not a believer in “the customer is always right” school, because they are not. However, when it comes to complaints, I’m all about extreme customer service. To the extent you can, resolve the matter in the way the customer wants. Not only is this often the right thing to do (after all, people do not normally complain without reason), but it will also prevent the viral negative chain reaction from igniting.

•Have a “no tolerance” policy. Employees who give poor customer service should be gone, period.

•Make sure it is not systemic. The same complaint again and again is a warning sign that you have something amiss. Finally, one way to avoid complaints altogether is to get customer feedback as often as possible. Honest critiques from people who like your business are invaluable.

Today’s tip: Someone once told me that the best piece of business advice he ever received was, “ask them what they want, then give them what they want.” In this time when virtual complaints have such potential power, that may be the best policy of them all. Remember: 95% of unhappy customers will do business with you again if their problems are solved quickly and satisfactorily. The best way to do that is ask them what they want, and then give them what they want.

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Your company is nothing without customers. Make sure you play nice by following these steps.

Entrepreneur Magazine - Guy Kawasaki

1. Start at the top. Your attitude toward customer service is the primary determinant of the quality of your company’s service. If you think customers are a pain and always want something for nothing, that attitude will permeate your company, and service will be lousy.

2. Put the customer in control. The best kind of customer service happens when management enables employees to put the customer in control. This requires two leaps of faith: trusting customers not to take advantage, and trusting employees. If you make these leaps, your customer service quality will skyrocket. If not, you’ll soon learn the hard way that nothing’s more frustrating to customers than companies claiming something is “against company policy.”

3. Take responsibility for your shortcomings. A company that does so will likely provide great customer service for two reasons: First, it’s acknowledged that problems are the company’s responsibility to fix. Second, customers won’t have to go through the aggravating process of getting you to accept blame.

4. Don’t point the finger. As computer owners, we all know that when programs don’t work, vendors often point the finger: “It’s Apple’s system software.” A great company figures out what the solution is regardless of whose fault the problem is. As my mother said, “You’re either part of the problem or part of the solution.”

5. Don’t finger the pointer. Great customer service companies don’t shoot the messenger. Whether a customer, employee, vendor or consultant is doing the pointing, don’t silence the messenger–just fix the problem.

6. Don’t be paranoid. A common justification for antiservice is “What if every customer did this?” To cite the often-told story of a customer returning a tire to Nordstrom, what if everyone started returning tires to Nordstrom? Don’t assume the worst case will become the common case. There will be abusers, yes, but generally, people are reasonable.

7. Hire the right people. Customer service isn’t a job for everyone. The ideal candidate derives great satisfaction from helping people and solving problems. When you hire folks without a service orientation, it can be a bad experience for the employee and the customer.

8. Underpromise and overdeliver. The goal is to delight a customer. For example, the signs at Disneyland estimating how long you’ll have to wait in line are purposely overstated. That way, when you get to the ride quicker than expected, you’re delighted. If the signs were understated, you’d be angry because Disneyland lied to you.

9. Integrate customer service into the mainstream. Sales makes the big bucks. Marketing does the fun stuff. Accounting cuts the paychecks. Customer support does the dirty work of talking to pissed-off customers. Customer service has as much to do with a company’s reputation as any other department–so integrate customer service into your company’s mainstream instead of considering it a profit-sucking necessary evil.

10. Put it all together. Suppose a part breaks in a gizmo you sold. First, take responsibility: “I’m sorry it broke.” Second, don’t point the finger–don’t say, “We buy that part from a supplier.” Third, put the customer in control: “When would you like the replacement by?” Fourth, underpromise and overdeliver: Send it at no additional charge via a faster shipping method than necessary. That’s how you create legendary customer service.

“Empower entrepreneurs” is Guy Kawasaki’s mantra. He is co-founder of Truemors.com and VC firm Garage Technology Ventures, and is author of eight books.

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Bad Customer Service Negates the Best Marketing Plans - Susan Gunelius

The best laid marketing plans can be destroyed with the smallest customer service mistakes.  The power of the internet continues to grow and that means customer service issues are publicized for the world to see and learn from.Antonio Cangiano’s recent negative experience at his local Best Buy (NYSE: BBY) provides a perfect example of the backlash companies feel when poor customer service situations become top stories in the blogosphere and beyond.  Even Consumerist.com published a post about Antonio’s nightmare of trying to return merchandise at Best Buy whose return policy is unclear and apparently full of loopholes.

Return policies are a prime source of customer complaints lately.  Stores like Target (NYSE: TGT) and Toys ‘R Us are not shy about their new return policies that leave much to be desired from the customer’s point-of-view and have many customers (like me) shopping at competitors’ stores.

Will retailers see the light and revamp their return policies and customer service?  You’d think customer service would be a top priority, but sadly, it falls to the wayside these days.  Great customer service is not the norm anymore, but it does make a great differentiator and keeps customers coming back.

What do you think?  Read Antonio’s story here.  Do you think Best Buy could handle this situation better?  Do you think they’ll react differently now that Antonio’s story is crossing the web? (Comments encouraged!)

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Measuredup.com is a leading site where consumers rate and review the customer service they experience from any business, large or small, anywhere, at anytime. The site is fun, free and easy to use and read by thousands every day.

To read reviews you can either browse by Category Links or use the Measuredup Search Box found on every page of the site. You can also click the “Read Reviews” box or the “Recent Reviews” link.

To write a review click the “Write a Review” box and follow the instructions. It takes about 2 minutes to write a review. Writing a review is quick and easy. You can be anonymous and post a picture. The data we ask for in this area is so we can index your review for other interested people to find. If you are really paranoid about your identity you can put a fake name and email in the boxes. Submitted and approved reviews are available on Measuredup and may also be picked up by search engines or blogs.

Companies that care about and value Customer Service love MeasuredUp. Companies that treat the customer like dirt or place little value on customer service probably hate us. We are here to be a resource to consumers so they have a platform to complain or to praise.

Companies that advertise or sponsor categories on MeasuredUp, or take the MeasuredUp Pledge, show that they care about Customer Service. They may not always be perfect, but by advertising on MeasuredUp they are making the statement that they are trying to listen to customers and improve customer service. Occasionally a review that is not so great might be written about a company that is pretty great. We encourage people to be fair when writing a review and remember that anyone can have a bad day or a misunderstanding.

We invite you to browse the site and post consumer feedback (good or bad) about your own personal experiences with customer service.