By B.L. Ochman
These are the first What’s Next Blog’s annual Pissoffy Awards to clueless corporations.
For their callous and clueless behavior in 2011, the honors go to Netflix, Bank of America, GoDaddy and Verizon.
Each company paid the same price for pissing off their customers – a precipitous hit to the bottom line and a huge loss of business.
The lesson learned by each was the same: if you don’t listen to your customers, they will get angry enough to leave you and they won’t come back.
Social media amplified customer dissatisfaction in real-time, while the companies took anywhere from one day to two months to reverse their unpopular policies. In each case, the company said it was changing its mind in response to customer feedback. And in all cases, the reversal — too little, too late — couldn’t undo damage to reputation and sales.
Why Netflix, Bank of America, Verizon and GoDaddy won What’s Next’s first annual Pissoffy Awards
1- Social media spreads news, good and bad, in real-time and allows people to instantly amplify their point of view through their extended networks.
It’s a big hassle to switch banks or phone companies, but people will leave if you refuse to consider their needs and desires. Once they’ve left, customers won’t give companies a second chance. Each of these companies made people mad enough to bother to move.
2- Responding has to happen in real time.
These companies took an entire day, and in one case, three months, to reverse a bad decision that could and would do potentially irreparable damage to the bottom line.
Within two hours, a company has to acknowledge that it is aware of, and looking into an issue. The announcement has to be made in the medium where the issue arises. If that’s on Twitter, a Tweeted response is necessary. And then the company quickly has to explain how and when the issue will be resolved.
3- If your customer service sucks, nothing else matters.
Nobody had warm, fuzzy feelings about any of the Pissoffy Winners. It doesn’t matter what you sell, or how great it is, if you don’t consider and respond to the needs and desires of your customers. If you have an ongoing relationship with your customers, created by listening and working to satisfy their concerns via social media, they may cut you a break when you make a mistake. The key is to respond quickly and openly. Admit mistakes and move forward. Turn a deaf ear, and you’ll pay the price.
A review of Pissoffy winners’ biggest and most avoidable customer service disasters:
July: Netflix announced that it was splitting its DVD and unlimited streaming services into separate plans, doubling its prices, and changing its name to Quikster.
They took back the plan 23 days later, but it was too late. The company lost roughly 1.5 million customers and stock prices dropped precipitously, from $300 a share, to less than $150.
Oct: Bank of America announced a $5 a month fee for US debit card users to use their debit card for purchases. Amidst huge customer outrage, the bank backed down — two months later.
Twitter, Facebook and blogs fueled the fire, and one customer, Molly Katchpole, a 22 year-old woman from Washington, collected more than 300,000 signatures on a petition circulated via Change.org. This led to a grass roots effort calling for “Bank Transfer Day” when tens of thousands moved their accounts to local banks and credit unions. BOA Stock prices are below $5 a share for the first time since 2009.
“We have listened to our customers very closely over the last few weeks and recognize their concern with our proposed debit usage fee,” David Darnell, co-chief operating officer at Bank of America, said in a statement. Doh!
Oct: GoDaddy announced support of controversial Stop Online Privacy Act (SOPA). The announcement got picked up on Reddit on Dec. 22, 2011 and went viral.
Within a few days, more than 72,000 customers moved their domains from GoDaddy’s hosting service. Protestors included Wikipedia founder Jimmy Wales, Ashton Kucher, and Cheezburger’s Ben Huh. (as in I Can Has Cheeseburger, FAIL Blog) @benhuh Tweeted “We’ll move our 1,000 domains off @godaddy unless you drop support of SOPA. We love you guys but #SOPA-is-cancer to the Free Web.”
Dec: Verizon. A leaked internal Verizon memo announced that, beginning Jan 15, 2012, Verizon would follow in Sprint’s footsteps and charge customers $2 “single payment fee” if they opted to pay their wireless bill online or over the phone. The only way to avoid the fee would be to pay by electronic check or sign up for AutoPay to take the money directly from your bank account or credit card.
Within hours, 95,000 people had signed an online petition protesting the charge. The reversal, just one day after announcing the fee, also came after the industry regulator, the Federal Communications Commission, told The New York Times it would investigate the matter “on behalf of American consumers.”
Verizon reversed the announcement, saying “The company made the decision in response to customer feedback about the plan, which was designed to improve the efficiency of those transactions.”
Perhaps they should get a prize for fastest reversal of the year.
“The line it is drawn
The curse it is cast
The slow one now
Will later be fast
As the present now
Will later be past
And the first one now will later be last
Cause the times they are a changin’”