Bad service hurts businesses in many intangible ways – company’s reputations suffer, customers spread bad news via negative word of mouth and potential new customers avoid maligned and disparaged companies. But it turns out there can be tangible costs too!
TWC must pay $229,500 for robocalling woman 153 times. Let this be a warning to companies that choose to ignore customer service (and good common sense).
Which common (non)sense do you think is worse?
- The company didn’t fix the problem after the customer raised the issue OR
- The company denied it knew the customer found the robocalls offensive.
Here’s what the judge had to say. Time Warner Cable “harassed plaintiff with robocalls until she had to resort to a lawsuit to make the calls stop, and even then TWC could not be bothered to update the information in its IVR system.”
I have NO IDEA what the actual costs to TWC will be in this case… but here’s a list of possible things that will likely afflict them. Actually paying the $229K PLUS…
- The technical cost to fix the system to prevent such calls to other customers
- The customer service cost to create a work-around until the technical fix is made
- Legal fees
- Public relations (i.e. bad word of mouth WOM) costs
- Low employee morale (and productivity) to be associated with such a fiasco
- Likely costs of copycat (real or fake) complaints
Companies that choose to ignore their customers do so at their own peril. I know many good people at TWC who are smart enough to see this as a problem and correct it but still can’t understand what kind of corporate culture allowed it in the first place. Instead, TWC could have reacted differently to salvage the relationship and prevent the media storm.
The pivot point is that your customer interactions (or lack thereof) have distinct costs and benefits. Make sure your company invests now to ensure those interactions make money and don’t get splashed over mass media. More here in “Word of Mouth – Taxes and Dividends”