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Customer Service: Actions Speak Louder Than Words

Customer Service: Actions Speak Louder Than Words

For the longest time, the wireless phone market in the US has been dominated by two players – AT&T and Verizon. It makes perfect sense that these two would dominate this marketplace, because they were the top players in the older and ubiquitous land-line business, too. It was a natural progression for these carries to move into the new and rapidly expanding wireless segment because that’s what big corporations do.

They have a clear pulse of what their customers want, so they create a pipeline of products incorporating the latest technologies to capitalize on that demand. In addition to being the first parties at the table, these companies also enjoyed the luxury of having deep pockets because the telephone industry, be it land-line or wireless, is a capital intensive business, so the barriers to entry for a new player are steep. Therefore, it is safe to say these companies enjoy an oligopoly in this space.

The reason I use the word “oligopoly” is because they behave as such. Although, each pursed different paths, their actions ensured that their customer base suffered. AT&T using its clout, signed a deal with the most popular phone maker, Apple, to offer the iphone exclusively on their network. Similarly, Verizon adapted the CDMA standard making it impossible for their customers to port their phones to other competitive carriers. Both the carriers signed their customers to long-term contracts and made it expensive for them to break those contracts.

In addition to charging their customers ridiculously high monthly fees, any time a customer went over their allotted monthly limits, they would slam them with overage charges that were nothing short of extortion. Add to this, all the hidden charges that were tagged on to customers’ monthly bill, combined with atrocious customer service.  It is no wonder then, that their customers were extremely upset with these carriers.

Disgruntled customers from these carriers were looking for a better option. And into this landscape there entered a new upstart that would disrupt the status quo and in the process break the stranglehold of these two companies. That company was T-Mobile. As its brash CEO John Legere proclaims in one of his podcasts: “…The dumb and dumber will not change unless they are forced to change…” And that is exactly what he did in short order – force change at these two big carries.

He pioneered the “Wireless customer Bill of Rights.” “Which includes: No service contracts and no overage penalties, the ability to replace your phone when you want, keep the data you paid for, stream music and video without using all your data, roam without spending too much for international service, coverage without limits, and no-haggle business pricing.”

These ground breaking features offered by T-Mobile to its customers has been nothing short of spectacular. And the customers of the rival carriers (AT&T and Verizon) rewarded T-Mobile in kind by signing up with them in droves, while their existing customers stayed put. The following numbers bear out those facts.

According to the latest figures compiled by Consumer Intelligence Research Partners (CIRP), a market research firm in the wireless industry, “the third-largest mobile carrier posted by far the highest growth rate (42%, compared to Verizon’s 14% and AT&T’s 10%) for new phone activations among customers transferring from a competitor, for the quarter ending March 31st 2016.” According to Josh Lowitz, partner and co-founder at CIRP, the gains posted by T-Mobile were “astonishing.”He went on to say that “… T-Mobile attracted the most new subscribers in the industry over the past two years, while retaining its current ones…”

The report also found that T-Mobile’s losses of 18% - of its base of existing customers that was at risk of leaving to other carriers - where on par with losses at Verizon (17%) and AT&T (16%). The report went on to say, “adding up all the transfers and also taking into account new, first time mobile customers, T-Mobile lapped the field with a net 31% growth rate among new activation customers in the first quarter of 2016. AT&T posted a net gain of only 3% and Verizon increased just 1%, all other carriers had a net loss of 13%.”

Time and again, I mention in my posts, the only way businesses can sustain and grow is by treating their customers fairly. They should make a commitment to earn their customers’ business every day. Without that commitment, though, any razzle-dazzle advertising, token support for social causes and phony fluff pieces by their PR machine about their “commitment to great customer service” will not help them in retaining their existing or attracting new customers; because, at the end of the day, actions speak louder than words.

We at housspros.com humbly feel like we’re cut out of the same cloth as T-Mobile. Home Advisor (formerly, Service Magic) and Angie’s List – the two dominant companies in the online home-repair-referral space – have been riding roughshod over their customers for a while now. So we want to follow T-Mobile blueprint to disrupt this space. We promise to never hold back on, or nickel and dime, on any features that will help the businesses and the customers of our website connect with each other in an environment grounded in transparency, integrity and fairness.  

Image Source: adweek.com



Last Updated: 2017-10-26 19:52:11

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