Declining Customer Service

In today's Post, Howard Kurtz takes on lousy customer service, particularly atrocious telephone support. He provides a tale, which reminded me that this is not a particularly new phenomenon:

A while back I canceled a 30-day trial on a cell phone that had terrible reception and was told I had to wait for the company to send a mailing label so I could return the phone and get the promised refund. The label never came. I called back and was again told the label would be sent out. I'm still waiting. This came after I had called another cell phone company to cancel a contract that had expired after two years. The firm kept billing me. When I called to complain, an agent said there was no record of the cancellation call.

Many years ago, if you're old enough to recall, a certain monopoly company controlled our nation's telephone lines - and owned all of the telephones hooked up to those lines. After deregulation permitted consumers to buy their own telephones, this company benefited from the fact that many customers didn't pay much attention to their bills and continued to lease equipment. I was managing a small business and, when I inquired about the possibility of upgrading the phones, I was told that they were leased. I asked how much the business was paying - $150 per month ($50 per phone). I pointed out that for not much more than the monthly rental price we could get three far superior phones with no recurring fee. This struck the business owner as a good idea, so I called the monopoly to cancel the contract. I was told that somebody would come by to pick up the old phone system.

A month or two later, I received a call from my boss who, after thanking me for saving him thousands of dollars per month across his various locations (having now cancelled all of his leases) told me that he had been billed for the leased phones at my location. I called the monopoly and was told that the lease had never been cancelled. I protested that I had spoken to a representative, had cancelled the lease, and had been told that the cancellation was effective. The reply acknowledged that I had in fact done so, but "That person didn't have the authority to cancel your lease." (When I pointed out that the woman's actual authority had no relevance to a situation where she had exercised apparent authority, the monopoly relented. They knew the law - they were simply trying to give a long-term customer one last screwing.)

If you look at the aspects of a business which are most important to consumers, they boil down to price, quality, and customer service. If you encounter a business which is the best in its field for all three, you are most likely dealing with a monopoly. If the business is not a monopoly and the competition does not respond, it will likely grind its competitors into the dust. But in most fields, a business can only strive to be a leader in one or two of those areas. (For example, if a business chooses to surpass the competition in quality and customer service, it will almost inevitably also be more expensive.)

We can get better customer service - but we have to be willing to pay for it. Businesses have figured out that, for the most part, the quality of customer service is not critical to making the initial sale. Thus, they focus instead on price (and ideally also on quality), and customer service becomes an afterthought.