Service Rant: Sprint Wireless

Some service companies are exceptional at making customers productive resources (Southwest) and some are not. I generally place wireless companies into the latter category.

So when I activated my wife’s new smartphone this week, I was disappointed - though not surprised - at the experience.

My intuitive first act to activate the phone was to turn it on and dial “0”, assuming that the network would recognize that the phone wasn’t active and connect me with an automated service that would help set me up.

As so often happens when I assume an intuitive service interface, I was wrong. The network recognized that my phone wasn’t activated, but rather than taking me through an activation process as I had expected, it pleasantly informed me that to activate the phone, I would need to call Sprint customer service. Of course, while I was told to contact customer service, the prompt didn’t give me the customer service phone number. I hung up, perplexed. Luckily, just before hopping online to find the customer service number, I notices a small message on the smartphone screen informing me that customer service is “*2”. Thinking I had the answer to my problem, I input *2, only to be met by my familiar autoservice voice. This time, however, it informed me that I couldn’t activate my new phone from that phone.

Bewildered at the unnecessary complexity, I called Sprint wireless from my landline, and spent the next 26 minutes with a live agent activating my phone.

It was completely inefficient interaction, needing 3 calls on my part, requiring me to have a different phone to activate the one I wanted to use, and taking almost ½ hour of live customer service time that could have been completely avoided with technology enabling the right engagement process.

Wireless companies are amongst the most criticized service experiences. As businesses, they routinely struggle to retain customers and maintain profitability. In a single interaction, there were several opportunities for the customer to serve themselves and increase success and satisfaction while decreasing cost. And that was just the first interaction.

Service Rant: January at the Gym

January at the gym – the month where “resolutioners” – those people who make the promise to get back in shape, commit to a healthier lifestyle, eat better, etc. for the coming year – come to the gym in droves on newly purchased or gift memberships.

It happens every year, and it makes January is a capacity disaster at the gym.

Lines are stacked 3-deep at many machines with people waiting for a turn. Personal trainers and nursery slots are booked weeks in advance, and you have to palm the cleaning staff a fiver to find an open treadmill. The gym becomes a mixture of expert and novice users, with the former waiting while the latter read machine instructions for proper technique.

Because it happens every year, the gym’s annual unpreparedness is inexcusable.

I’m not saying the temporary increased interest in fitness is a negative. If more people made the commitment and stuck with it, our country would be healthier, lives would be saved, healthcare costs would decrease, and all manner of positive societal benefits would ensue. But the truth is, that most of the resolutioners will be gone by the time the calendar turns to February, and the gym has to shoulder some of the blame for it.

If they wanted to keep the new clientele, they’d make it more attractive for them to stay. Dedicate capacity to the new users to show them how hassle-free gym services are the other 11 months of the year. Deploy more instructors to shepherd new clients through their first few trips. If permanent staff is fully allocated, they could get creative and use a compatibility service to assign a current power user customer to a guide the “newbie” on how best to use the services. They wouldn’t act as a trainer, but someone who can give helpful tips on when to go, how to use the extended services, general etiquette, and so forth. It could be a reinforcing relationship for each party, and at the least would make someone new find what can be an elitist environment more comfortable. If the current user needs motivation for their time, offer something – training sessions, tanning sessions, free protein shakes for a month – for their troubles.

At the same time, create capacity to serve all clientele. Consider taking loyal customers out of the gym – arrange for an alternate facility, or better, a loyalty experience such as a series of hosted events – a hike or climb, ski trip, a members’ triathlon, an adventure race – something that rewards the most loyal clients for their loyalty and gets them offsite in January. For those that stay and put up with the wait on machines, reward them with free training sessions (AKA a free service trial for a potential future stream of revenue) in December or February as a thank you for their patience.

My gym – and most I’ve ever used - manages the annual January capacity shortage awfully, and deteriorates relationships universally, frustrating loyal customers while alienating new ones. It all sorts itself out when most of the new customers cease using gym services, and a few of the frustrated loyal customers change gyms, and capacity turns to normal. But it doesn’t have to. The gym could use the capacity shortfall creatively to reward loyal customers, welcome new clients with positive first experiences and customer-to-customer interactions. Of course, customer retention would create an ongoing capacity problem, and then the gym would have to deal with more revenue, profits, need for expansion, and other such successful business headaches.

Service Rant: Ticketmaster

The music industry has seen an unbelievable amount of change in the last decade, mostly brought about by the advent of file sharing. First, music was tied into expensive bundles on hard media distributed through tightly held channels. Then it was free and distributed by anyone with a T1 line. Now it costs money again, may be as expensive as before, but since the bundled offerings (CD’s / LP’s) have been pulled apart to allow consumers greater choice over what they purchase, overall value has risen dramatically.

Personally, I love it.

It moves an experience (what else is music but an experience) from a product-based environment to a service-based environment.

But it has also changed other elements of the business model. The profit comes less from record sales and much more from live entertainment. Today’s most successful acts are those with the largest live audiences / followings. Because the new success formula requires a heavy touring schedule, audiences are treated to more of their favorite artists on a regular basis. More touring bands increases the available supply of live music options, keeping ticket prices very reasonable through a period of growth.

The problem that exists in the new model is similar to what it was in the previous one – the distribution channel using its relative power to extract margin from a consumer base with few short-run alternatives. It’s an extremely shortsighted strategy, given that it recently led to the downfall of the media product-based business model of the recording industry.

A recent example: Floor tickets to a recent arena show cost $45.25 apiece, which I would say is fair for the experience. Add to that a convenience charge of $10.05 each and an order processing charge of $2.60. That’s 28% in add-on fees!

Surely something as well-named as a “convenience charge” has tangible value tied to it, right? Actually, the convenience charge covers Ticketmaster’s costs of providing tickets at local ticket outlet locations, staffing call centers and ongoing maintenance of its website. So I’m essentially being charged for Ticketmaster’s costs to hang their shingle in public.

The processing fee? Covers Ticketmaster’s costs for taking the order, arranging for shipping or coordinating with the box office will call – essentially the cost elements of fulfillment, less the cost of shipping, which will cost extra, even if your tickets are emailed to you – the marginal cost of which has to be approaching $0. (In all fairness, standard mail is free, so at least Ticketmaster is willing to front you a 1st class stamp, if you’re not in a hurry)

Cost-plus pricing models seldom work in manufacturing industries, and far less in service industries. That Ticketmaster hasn’t found another way to extract margin or consumer surplus shows them as unimaginative.

Their defense is that they have the right to seek fair return on their investment and efforts, which to me sounds a lot like the point-of-view that the RIAA members had before their business model was made obsolete and they started suing their customers for leaving rather than improving their service / product mix.

Service Rant: Amazon.com

I’m disappointed in Amazon.com.

In their 1st twitter foray, they’ve abandoned the thing that I appreciate most about their retail experience – their ability to take my page view and purchase history, construct a startlingly close customer profile and use that for timely product purchase suggestions.

Instead, their twitter presence (amazondeals) behaves like a social media Kmart blue-light special, marketing products to me without regard for appropriate interest. It takes the unbelievably solid permission-based model they’ve developed over years to become the most trusted name in online retailing and moved the brand experience closer to spam.

I understand that social media is very rapidly becoming table stakes for all global brands, and that Amazon may have felt that they needed to "claim their territory", and could settle for getting a viable model into operation and then come back later to improve the experience to look, feel, and interact with customers like the retail site.

They should have taken more time to construct a twitter experience consistent with their flagship online retail experience. It likely wouldn’t have taken much to add a few fields / questions to the Amazon customer profile, request that customers update profiles with their social media personae, and then use the existing retail customer preference profiles to deliver timely, personalized, relevant and permission-based marketing to Amazon users via their facebook / myspace / twitter accounts.

Even if this task would have taken awhile, I have to think it would have been worth it. Their first try is brand deteriorating rather than brand-building.

Service Rant: Another Reason to Skip the Gym

As a way to deal with the economic downturn and an ubercompetitive local market, my gym has reduced staff. Fewer trainers, smaller cleaning crew, fewer caregivers in the nursery. Not a surprise. Staff reductions are the easy fix to aligning costs with a reduced amount of revenue.

Here’s the problem:

To cope with a reduced nursery staff, my gym implemented a policy requiring parents with infants to make an advance reservation for nursery care.

When I discovered that Saturday mornings were booked solid until my 4-month-old is a university sophomore, I expressed my displeasure with the new policy.

A little irritated, I adjusted, switching from a prime weekend morning workout to a less-crowded weekend afternoon slot.

Next, I was turned away from the gym altogether when there was inadequate staff to deliver on the promise of the care for the time slot I had pre-arranged.

Now, I’m looking for a new gym.

I’m generally tolerant. I understand that service operations are tough in the current environment, where companies have downsized and are faced with demand for their services that has both diminished and gotten much more variable.

The first strike was diminishing the service value by implementing a reservation system that made it more difficult to use their services, regimenting when I would be able to access use the facility and made me pre-arrange my weekend schedule.

The second was not realizing that Saturday & Sunday morning are prime workout times for working parents and staffing to an adequate level for that 4-hour block to accommodate everyone.

The third was not having adequate capacity to deliver on the promise of care when I needed it.

They’re not out yet, but they soon will be. Then they can try to cover their costs with even less revenue.