This post could be entitled Disasterous Customer Service Experiences Part X, Y and Z. The ultimate worst example of sheer lunacy, moronic and near sadistic customer treatment, by Sprint Nextel.
(CORRECTION 6 hours later - A Boston Globe article had Sprint Nextel representative state the minimum level was 40 calls. A reputable web source had said 25 calls which I first quoted)
CNN has just a few moment ago reported that Sprint Nextel, in its infinite wisdom, has sent 1,000 of its customers a letter informing them that because they have placed too many calls to the calling center asking for help or complaining about the Sprint/Nextel services, they are terminating the customer relationship.
Note - these are fully paid up, loyal customers, not delinquent customers.
Yes, Sprint/Nextel has now set the bar for the most abusive customer relationship management decision ever. Not so much as setting the bar, they have risen it miles above what anyone in any industry before has deemed reasonable. This is so beyond arrogance and conceit. I have no word for it.
Oh how many is too many? 25 40 calls per month. Less Little more than one per day. If you have a problem that your operator has promised to fix, but for some reason it isn't fixed in the time promised - ie the problem continues, wouldn't you be tempted to call them every day until it was fixed? Like say, network coverage problems? We've all been there at some point in our phone service, messed up call center, wrong promises (or misunderstandings), not expedited complaints, return calls, etc. And then yes, I know of many friends who've been in a situation to have to call back to the operator on many consecutive days to try to get promised fixes until they were accomplished. 25 40 calls? Sprint Nextel cannot accept one call per day from - legitimately upset or curious (or slow learner) customers totalling 1,000 - out of what, 55 million customers for whom they provide calling center support? This must be the biggest black eye, biggest own goal, biggest fumble in marketing ever.
For Non-American readers, please know that Sprint and Nextel have merged recently. I am sure there are reasons some customers have had reason to call about issues with that. Note that cellular networks are hideously BAD QUALITY in coverage in America (being the backwaters of mobile telecoms, the cave man region of the world, even Eastern Europe is ahead of America and several individual Latin American countries are ahead of the USA). There is honest real reason to complain just by those matters, anyone who has driven in the USA attempting to call on any cellular network knows there are serious problems.
But what people outside of telecoms don't know, is that also the wireless telecoms industry is habitually hemorraging money, with "revenue leakage" globally on a 10% level - meaning mostly they forget to bill us the right amount, but also that often they overbill us - many large corporations will measure traffic and compare to bills and then threaten to sue carriers/operators for overbilling. All carriers/operators have revenue leakage, good ones have diminished it to about half that number, nobody reports zero revenue leakage, and the global giant accounting firms, the Deloittes, KPMGs etc do revenue leakage audits regularly for the carriers/operators. So it is TOTALLY commonplace that some customers have wrongly billed items on their phone bills. These are all valid REASONS to call and complain.
And then our industry is under enormous change. Going from 2G to 3G, going from voice services to data services, selling picture messaging, video calling, music downloading, mobile internet, wireless TV, cellphone gaming etc. And the operators are notoriously poor at informing customers what are the true costs of given services, eg an MP3 song costs x but the data traffic will be "additional" without a specific commitment. A video game costs y, but the data transmission costs are extra. Does my package allow me to download this. What if I do that, how much will it cost. There is EVEN MORE reason to call and complain.
And yes, "those who complain the most" - first of all who complains the least? The person who is LEAST likely to adopt any of our new services where the future of Sprint/Nextel would be. It does not follow that those complaining most automatically use all the new services, but if you only use voice, you have very little reason to worry about gaming or picture messaging or music service enabling (one call), problem in first time use (second call), question about interconnect with rival network where my best friend is on (third call), question about strange item on phone bill (fourth call), question about rival network offering with a feature not obvious in our service (fifth call), problem enabling the old service onto my newer phone after upgrade (sixth call)... So if I'm a new user of just one of the newer data services, I suddely "average" six more calls to the calling center than the old grandma who never calls on her phone, uses it only in the car as safety phone..
Now imagine a young, hungry, IT savvy heavy user. Who is heavily into the internet and social networking, and very much wants to explore the mobile internet. Flickr uploads, MySpace profiles, music, ringing tones, games, coupons, payments, on and on. Then assume its a young user, with plenty of honest real concerns about managing a budget, wants to be clear what things cost - and yes, bear in mind, this industry is hideously bad at reporting all costs clearly and accurately. If you get heavy users, there are VERY MANY instances when you might be inclined to call the calling center. And if the calls to the calling center are free, it does make sense to call, perhaps to check on how much of a balance you've run up this month already - or how much is left on your prepaid account.
And there are the handsets. The average cellphone user replaces the phone every 18 months. 28% of all mobile phone owners have two or more subscriptions, usually on different networks and often with second phones. So it is very possible to want to call the calling center when you get a new phone - on your network or a rival - the more you replace phones the more reason to call. How do I move my numbers, why is this service not like it was. What happened to my voicemail or what is my messaging center or where do I get WAP settings etc. The person who replaces phones more often - heavy users - have more reason to call. And even the exact same model Nokia or Motorola may behave differently on a rival network - reason to call.
And for our non-American readers, it is surprising to find out that American mobile operators (carriers) often "cripple" features from phones such as removing WiFi etc. Yes, some other operators have done that outside America too, but in the USA this is most prevalent. So a given feature of a phone, that is perhaps in the user's manual or talked about on the web, is not actually available on the phone you just brought home. So again more reasons to call.
And the iPhone !!! I'm sure many heavy users would have reason to call Sprint Nextel over the last few months, when the iPhone hype was growing, to ask if Sprint Nextel would offer the iPhone (and why not). Perhaps to call back if some rumor emerged, etc. Or perhaps to call again, to voice a strong desire for that iPhone, etc.
Part of those calls are legitimate calls for help - to USE services and get MORE usage of services the customer is having problems with. Its not like turning on the electricity in the home by hitting a light switch, etc. New services for cellphones can be very complex and confusing.
And part of those calls are legitimate COMPLAINTS when Sprint/Nextel has disappointed its customers. Not just the one who calls to complain !! Behind these callers are hundreds more who haven't called perhaps noticed the problem yet, or are not as inclined to take action, or are for example more accommodating to let some problems slide or will wait to see if a given problem disappears over a few days before considering calling to complain. The early complainer ALLOWS FOR BETTER SERVICE by identifying legitimate problems.
If it was not for complaining customers, there would be no development of our services and products. Bill Gates likes to say "Your most unhappy customers are your greatest source of learning."
Any intelligent, modern customer-focused organization will teach calling center staff to deal with complaints professionally - and to treasure the inputs from complaints.
But Sprint/Nextel is behaving like the carricature telephone lady that comedienne Lily Tomlin used to play, when she would say in her comedy bits "We don't care. We don't have to. We're the phone company."
But that was funny in a time when AT&T was a monopoly. Today Sprint Nextel is living in a modern, competitive market. And in this decade, Sprint Nextel is also subject to the new rules of Digital Community. It is not an accident of spelling, that our bestselling book is entitled Communities Dominate Brands.
Also let me be very clear about this. There is nothing wrong with a company seeking out which customers it does not want to renew and take actions to de-incentivize those customers. For example, nothing wrong, in finding 1,000 customers that Sprint Nextel does not want to serve, nothing wrong at all in principle. How to do it? Offer incentives for the good customers to stay such as price discounts and handset subsidies and only apply those to "preferred customers". Name the remaining 54 million and 999 thousand customers as preferred (with one criterion being reasonable level of use of calling center) and leave these targetted 1,000 customers without that benefit. Some will eventually get the message. Let them churn with normal churn rates.
Or if you want to be more pro-active about ridding them now, then do it with some dignity and fairness. Like in your letter you say you feel you are unable to satisfy the customer, fine, then tell the customer you offer them the chance to leave the network with no penalties and covering their number portabilty costs. Not by a unilateral edict but by giving the customer the choice.
Don't kick them ruthlessly out like this with no say in the matter. This is barbaric. This is Soviet Union era concepts of customer service (during Soviet times the Russian airline Aeroflot actually had a guideline for staff that they were not allowed to smile.)
We have a couple of times invited our readers to join in blogosphere revolt against a company. The results of the wrath of the blogosphere are swift and brutal as history can show from the prototypical case of Kryptonite. This step by Sprint Nextel is sheer punishment of paid-up loyal customers.
We at Communities Dominate blogsite will not stand by this. We immediately ask all fellow bloggers to report on this story and condemn Sprint Nextel. Even for an industry with a reputation for arrogance, this is the pinnacle of conceit.
So you, dear reader, if you are also a blogger (or reporter), we ask you to immediately join and report on this deplorable unilateral attack by an American giant against good customer practise.
Sprint Nextel must immediately apologize and invite all cancelled customers to return. We cannot allow ANY business to arbitrarily punish customers who call the calling center "too much above the average"
Shame on you Sprint Nextel ! This will go down as the most moronic marketing move by any company ever, worse than New Coke. The Marketing Management at Sprint Nextel better offer their resignations and the CEO better accept them. This is shameful for the whole profession of marketing, not just wireless telecoms.
We will monitor this story and report on its developments. I will dig up Sprint Nextel's CMO name etc next. But all of you, please join us, blog about this now and condemn this abusive action. No company can get away with this. Not in this new age when Communities Dominate.
FIRST UPDATE - the story gets worse (what else is new concerning Sprint?). Apparently also customers who "roam too much" are being kicked out. For example long-term Sprint customer who is with the army, was sent to 2 month posting to another USA State for training. That region was part of Sprint's network map coverage - ended up not working well, and the phone roamed to other American networks. Now Sprint Nextel tells this customer that their long customer relationship is terminated, get a local contract. A local contract there? In a temporary location, in a State he will only live in for 2 months of his life, never again, but where the soldier must serve (and where logically he has only his mobile phone for practical communications). What is the bizarre logic in this. The soldier's original posting reported now in many sources but original posted at Sprint Users Forum
SECOND UPDATE - I've written an Open Letter to Sprint Nextel urging them to reconsider and fix the matter now
THIRD UPDATE - I've now posted a follow-up piece. The story is far worse than I reported. Please read this Follow-up and you'll see.
UPDATE July 13 2007 - Even more revellations about America's worst company including independent verification that a common problem can lead to 40 calls, Sprint calling centers themselves giving wrong info and consumer protection agencies now mobilized; plus a funny joke, in "Sprint 1,000 story expanding."
UPDATE Oct 10 2007 - Sprint Nextel CEO Gary Forsee forced to quit as Sprint Nextel's customer growth stalls and company experiences severe customer defections as the stock price tumbles. We report about it in "Follow up on Sprint 1,000 - CEO Gary Forsee quits"
UPDATE Jan 21 2008 - Sprint Nextel exodus of customers gathers pace, stock price crashes to under half what it was before the Sprint 1,000 and the company fires thousands of employees and closes over a hundred stores as we report in "Nightmare Continues for America's Worst Company."
UPDATE Jan 24 2008 - The new CEO has fired Chief Marketing Officer Tim Kelly effective immediately. I've blogged about it at "Poetic Justice at Sprint Nextel"
This is so sad it's funny. It's very hard to imagine any company would do such braindead things, but apparently anything's possible.
Though the same end result can be achieved in other ways also, like Elisa is trying to do in Finland - screwing up your billing system and then having no one to answer the phones when people complain is a pretty surefire way of getting rid of some customers, too.
And then operators have the audacity to wonder why they're at the bottom of all customers satisfaction surveys!
Posted by: Sami | July 11, 2007 at 08:56 AM
Sprint Nextel could have saved themselves a lot of time and trouble by cutting to the chase - and sending every customer a letter saying: "We don't care what you think. If that bothers you f**k off now."
Other end of the telescope? If Sprint Nextel regarded itself of part of the community of Sprint Nextel users, what would it have done?
There is an argument that if these particular 1000 customers were having a disruptive and damaging influence on the community as a whole there should be some form of sanction - and ultimately exclusion.
But we're told these are good customers, fully paid up etc. So what if you have an issue with Sprint Nextel? Are you meant to consider carefully whether or not you should share that with them?
"I'm sorry to trouble you, master, but is there any chance you could take your foot off my head?"
It's the best way I can think of to prevent two-way flow. No dialogue. No debate.
No customer relationship = no customers.
More on this on my blog (glad to oblige!) http://fasterfuture.blogspot.com
Posted by: David Cushman | July 11, 2007 at 09:38 AM
I've never been a fan of the "customer service" of any of the carriers in the US. That said, I actually applaud this move by Sprint. Anyone who's ever run a business knows that "the customer is always right" is really just hot air -- often, almost all the time, the customer is usually wrong. Sprint realized that these customers were a drain on their system, and decided to do something about it. Sprint knew exactly what they were doing, and realized that the bad press and the lost revenue still wouldn't equal the drain of resources by these customers. A good business will always refuse business from time to time -- it makes sense and is good business if the business you are refusing would represent a strain of resources, hurt overall quality of the product, etc. These customers were a drain, and it's good to see a company stepping up to do something about it.
Barbaric? Ridiculous! You are dealing with constant complainers -- throwing them anything would result in more complaining -- best to just toss them without anything. Harsh? maybe, but last I checked the Constitution didn't guarantee that your cellphone carrier needed to be nice to you.
As for high data users -- again, it's a business decision -- and Verizon already did it a year ago -- http://www.consumeraffairs.com/news04/2006/07/verizon_unlimited.html
Posted by: Brian C | July 11, 2007 at 02:56 PM
Sprint is the worst company ever, and overpriced. If I needed to call them they put me on hold for hours (I'd leave it on speakerphone) usually I'd get disconnected before they answered my call. The only way I could reach customer service was by calling them late, late at night.
Posted by: PJ Brunet | July 11, 2007 at 03:24 PM
I blame Number Portability!
For years now, people used this as a weapon to show their operator the door.
Now, the operator is doing the same!
;-)
Werner
Posted by: Werner Egipsy Souza | July 11, 2007 at 03:30 PM
Hi Sami, David, Brian and PJ
Thanks for writing.
Sami - yes, me too, have had some bewilderingly bad customer service experiences with my operators in Finland and then the UK but nothing even remotely like this. What makes me sad is that many marketing people have been quoted on it - saw one on CNN a moment ago - who deplore this as a new low in customer treatment - and wouldn't it have to be, that we, the mobile telecoms industry - have to bear that historic "achievement". For an industry so despised this is just tossing more fuel to the flames..
David - thanks for blogging about it - great blog by the way, good point I hadn't even noticed before you wrote it, that this is of course dis-engaging the customer. This is in a very literal sense the evil anti-thesis of what our blog tries to teach. We try to get companies to engage. And Sprint Nextel will disengage. No disagreement equals no discussion equals no engagement. How very sad.
Brian - I hear you, its a valid point. And one made by quite many around this topic, that these customers "deserved to go" and thus Sprint Nextel's actions were actually a "healthy" thing for the company as a business enterprise.
Notice Brian, that I already wrote about that in my blog originally. I said companies have a full right to fire customers if they feel there is some reason. And lets agree that these 1,000 customers are actually inherently unrecoverably un-profitable, and should go.
But then - like I wrote - this is the absolute wrong way to do it. They could achieve the same result by totally non-intrusive non-offensive non-arrogant ways. They could simply not give future incentives to them (other customers get newer better prices or discounts or bigger bundles, why? Because they qualify for our "preferred customer" benefits...) which at the anniversary renewal of their contracts - no new handset for free this time - is quite a shock and should kick most of them away. With no backlash, no revolt at all. Some customers qualify for the subsidised customers, our preferred customers do, you, sir, are not a preferred customer. Sorry. No new phone...
These would churn away at the normal cycles of their contract anniversaries.
Or the really easy way - in this hideous letter, make it an offer at the option of the nasty customer. Offer him/her the "freedom" to leave the network with no departure penalty, paying for the transfer to another network. Many of the 1,000 would jump at it. The ones not willing to go, put to Plan A above...
Again, no hostility in the action and no wasted management effort now dealing with angry callers and customers and major investors and press and analysts etc.
What brainiac thought of this, really deserves to be fired, when the gentle totally non-threatening ways were always there to use.
PJ - Thanks. And ha-ha good comment on late nite to reach the customer service, I've done that at some times deliberately when there was particular congestion in my past too, but I don't think I ever did it for telecoms ha-ha..
Thank you all for writing. I'll be monitoring the story and reporting more on it as it develops. The blogosphere is convinced we are witnessing another Kryptonite or Dell Hell and its already called the Sprint Nextel 1000.
Tomi Ahonen :-)
Posted by: Tomi T Ahonen | July 11, 2007 at 03:45 PM
This is great news. Now, if I want to get out of my Sprint contract so that I can get an iPhone, all I have to do is call Sprint twice a day for 3 weeks. After that I am sure to be such a pain in the ass that they will gladly let me leave without paying an early termination fee.
Speaking of Sprint idiocy, the Blackberry data plan is $40 per month. An Power Vision Unlimited Data Plan for the Treo is costing me $10/month. Sure, they are technically the same service but the package has a different name. Can I buy a Blackberry and keep my plan? Nope.
Posted by: Jackson | July 11, 2007 at 04:39 PM
Sorry Tomi, but I've got my own customer service crusade at the moment. Trying to figure out what to do with the bad check I just got from Google Adsense. You want to see an example of bizzare customer service? How does a gazillionaire company like Google send out insufficient funds checks? tsk, tsk
Try this one. http://mobilejones.com/2007/07/11/adsense-nonsense-20-google-writes-a-bad-check/
The Sprint story is a good one, but mine is personal. With 1200 of those folks available, some US attorney will sue Sprint for sure. Me? I'm tiny lone publisher, although my holding a bad check from Google is an powerful message about their lack of customer service.
Posted by: mobilejones | July 11, 2007 at 05:59 PM
Ah, Tomi, never let the facts get in the way of yet another one of your tiresome anti-American rants. You'll take any excuse to jump off on it, won't you?
http://consumerist.com/consumer/exclusives/sprint-customers-terminated-for-complaining-too-much-were-scamming-sprint-for-free-service-277026.php
Posted by: flamebait | July 11, 2007 at 08:56 PM
Hi Jackson, mobilejones and flamebait
Thanks for writing.
Jackson, good points, ha-ha, yes this is now the way to get out of Sprint Nextel "jail" and onto an iPhone on AT&T. And yes, bizarre pricing plan. What else is new (I wrote a follow up piece, this story is so much more convoluted and utterly despicable, it makes me cry)
mobilejones - what? The do no evil Google (again? Their definition of do no evil sounds ever more bizarre by the day). That is miserable news. We'll support you of course, I'll blog about it. Google of course should know better. Shame on them.
But hey, thanks for stopping by. I think this story has enough steam in the blogosphere and mainstream press that it might survive without the mobilejones final touch ha-ha... Nice to hear from you. I'll blog about your Google thing.
flamebait (you sound like a regular reader?) - hey, first, are you seriously suggesting to DEFEND this company? Sprint Nextel that finished dead last in customer satisfaction in MSN Money's survey this May, not among telecoms providers, but by all American companies? Do you really mean I am off base on this story?
But then, on the specifics of the story you refer to. That has found no independent support anywhere. The person quoted is anonymous (might it have been you?) and the story now goes against the official position of Sprint Nextel yesterday quoted in the Boston Globe when they explained this matter more fully. No, I think that story you referred to is totally unfounded - obviously unless some proof emerges - and if would have been in Sprint Nextel's interest to tell that story if it had been true, in the statements to Boston Globe yesterday. No, I don't believe it is true those customers were somehow cheating Sprint Nextel's billing system and skimming money.
But flamebait, lets imagine for just a moment that it was true? Sprint Nextel is the worst company in America for customer service. If that was happening, it is a technology error in billing or a marketing error in pricing (or both). Any sane company would fix its error. Sprint Nextel prefers to fire its customers. No, even if that was true - this is totally the wrong way to fix it by Sprint Nextel.
Thanks for writing
Tomi Ahonen :-)
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Posted by: jackie113 | July 17, 2007 at 10:20 AM
quote
This is great news. Now, if I want to get out of my Sprint contract so that I can get an iPhone, all I have to do is call Sprint twice a day for 3 weeks. After that I am sure to be such a pain in the ass that they will gladly let me leave without paying an early termination fee.
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Posted by: David | July 30, 2007 at 07:49 AM
In July of this year (2007) I upgraded my Sprint Nextel phone. I went to Georgia last week and the temps got into the 40’s at night. I left my sprint Nextel phone in my truck with the windows closed. Following that, the phone works, however, the display, although lighting up, will not display anything. No background, contacts, nothing. I took the phone to the Sprint store in University Mall where it was purchased. They said they could see that it was not water damage, and referred me to the Sprint store on Dale Mabry where there was a techinician who could look at the phone. I went to that store, and the first person I spoke with said that the technician would try to repair the phone, and if it could not be repaired, that I could purchase an identical phone for $55.00. She said come back in an hour. I returned and spoke to another person who claims that the phone had water damage, and therefore, I would have to purchase a used phone for approximately $200.00 and that the $55.00 replacement did not apply. I explained that there was not water damage, that the cold weather was responsible. I was basically told that I was a liar. I could pay $200.00 for a used phone or pay $150.00 to end my contract. I was told that since I upgraded in July that I could not pay to upgrade my phone as they only allow one upgrade per year. This is an absolute outrageous rip off and a racket. The phone did not have water damage. Maybe it has damage from the dampness caused by the cold weather, but not water damage. The phones should work in the cold. I plan to turn this over to the Attorney General’s Office for investigation. Sprint Nextel does not care about their customers, particularly the management of the North Dale Mabry office in Tampa, FL.
Posted by: D. Johnson | November 14, 2007 at 12:08 PM
Sprint Nextel stock plunges, customers who complain of too high a bill terminated, those who use too much free time billed for time, and so on.
There is a pattern here of malicious deceit to make more money to cover lost revenue. It's called Class Action Lawsuit. Forget loyalty.
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