Tag Archives: customer loyalty

I BEGGED to be cancelled, and failed. Where did I go wrong?

Lots of people are getting cancelled these days. For most of them, it wasn’t something they wanted.

Cancel guy

I, on the other hand, wanted desperately to be cancelled, and my best efforts yielded exactly no results.  It left me somewhere in between ticked off and sad; call it pissappointedMy story is below, in blue.

We are referring, of course, to subscription auto-renewals (aka ‘evergreen clause’ or ‘negative option clause’, or in the words of one congressman, ‘zombie contracts’).

Auto-renewal practices are a critical way of sustaining revenue, but if done too aggressively, there are potential huge costs in losing customer goodwill and provoking litigation.

https://www.pewtrusts.org/en/research-and-analysis/blogs/stateline/2017/02/27/didnt-see-that-renewal-notice-some-states-are-trying-to-help

auto-renew cycle

One survey found that 59% of consumers had been auto-renewed in one way or another without their informed consent, at an average cost of $186https://www.nclnet.org/ftc_autorenew

This is often related to free trials with a commitment buried in the fine print, but it’s not always the case, as I experienced.

section-free-trial-mobile

Auto-renew allows companies to lock in revenue, often without the consumer even noticing. And they rely heavily on this practice; you will have to pry a company’s cold, dead hands off your money (usually with a lawyer’s help) before you get anything back.

Turns out I’m not the only one who’s been disappointed.

As a result, a lot of states are working on legislation to control abuse of the auto-renew, led by California’s Auto-Renewal Law (ARL), which took effect July 1, 2018 and prohibits automatic renewal of subscription or service fees without first presenting consumers with certain terms, and obtaining their affirmative consent.

The questions here:

  • What is the moral obligation to inform customers before they are going to be charged?
  • Is the retention of some proportion of ticked-off customers worth the blowback when they tell their friends/colleagues about it?
  • What actions can you take as a marketer or as a consumer, to avoid the need for litigation?

My story:

  • April 2018 – signed up for one year of online survey company’s premium package to support consulting work.  Not aware of any auto-renew commitment.
  • April 2019 – found out my credit card was automatically charged for another year.  Still used the service so no big deal; still, irritating to get neither a heads-up nor a confirmation that a charge was made.
  • March 2020 – didn’t need service anymore.  Through my account portal, cancelled and switched off auto-renew a month before renewal (on advice of the company).
  • May 2020 – surprised to find that I’d been auto-billed again, despite cancelling.   No email notice.
    • Emailed company: ‘must have been a mistake; don’t need it anymore, please reverse charges, thank you’.
    • Company responds that a) their records show that auto-renew was reinstated on my account (which it definitely wasn’t!)  b) you are ineligible for an exception because it renewed over a month ago  c) we cannot give full or partial refund.  d) you should know this; it was in our T&C when you signed up (you noob).
    • Increasingly animated emails from me met with consistently anodyne ‘geez, we’re real sorry, you messed up, we can’t do anything about it’ responses.
    • Stopped payment on credit card; company now has cover and responds with: “Although our system showed that you re-instated your subscription, from your words, I know this was a mistake and clearly a human error.  Even if I could make an exception for you, because a dispute has been filed with the card issuer or bank, we can’t take any action on the account.”
    • Thankfully, the charge was ultimately reversed. 

But it was LOTS of effort, and let’s just say it won’t help their Net Promoter Score if I am asked for my opinion.

online-reviews

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This is a big, popular, generally well-regarded company and they’re clearly taking all steps possible to maximize revenue retention.  How many other companies are using the same tactics?

Disable auto-renew

Well, in the last few years, over 100 companies have been sued for deceptive auto-renewals, including those shown below (spawning a cottage industry of how to disable auto-renew):

Screen Shot 2020-08-23 at 8.25.16 PM

Sirius XM

Noom

Angie’s List

Dropbox

Spotify

Hulu auto-renew

 

 

 

 

Hulu

SeaWorld

Birchbox

LifeLock

AAA

Blizzard Entertainment (World of Warcraft)

Gunthy-Renker (Proactiv skin products)

Apple-Music-Auto-Renewal1

Apple

eHarmony.com

Tinder

Blue Apron

Cancel-McAfee-Subscription

 

 

 

 

 

McAfee

Ancestry.com

New York Times

Consumer Reports

WalMart’s Beauty Box

It is no secret that a renewal is way more profitable than acquiring a new customer, and the fight for customers is fierce, so the focus on retention is understandable.

Retention-844x422

But at some point the negative impact of heavy-handed tactics, in terms of brand goodwill and image (not to mention litigation costs), could overwhelm the benefit.

My advice:

IF YOU’RE A MARKETER OF SUBSCRIPTION PRODUCTS OR SERVICES:

  • Become familiar with, and follow, California’s ARL; it looks to be the standard going forward
  • Offer in-between solutions that give the customer relief, but keeps them in the fold and positive.  (Example: when I tried to cancel my Audible subscription when my commute was drastically shortened, they offered a deal of $10/year to retain the books I already had, rather than losing everything.  That was a good solution for me.)

ec4fd5905c6732f9-800x386

IF YOU’RE A CONSUMER:

  • Read the fine print on everything you sign up for, and keep careful records
  • If you want to downgrade your level, challenge the company to provide a better option.  Frequently they’ll do anything possible to keep you.
  • Certain apps like TRIM https://www.asktrim.com/ automatically detect recurring charges on your credit cards; they can help identify needless renewals and help with cancellations

Loyal customers

IF YOU’VE READ THIS FAR:

  • Thanks for your patience and loyalty. You have automatically been renewed to follow The Armchair MBA for another 5 years.  You have no opt-out before that time.

Is This Any Way to Treat a High Value Customer? Ask My Mother.

Posted on

Do You Know Your Most Valuable Customers?  Do they know that you love them?

ecommercecrm

It’s 10 times harder to get a new customer than to keep an existing one.  Loyal customers are more profitable and have the highest Lifetime Customer Value. They love your company already.  They have already been acquired, qualified and taken through the funnel – – you have them where you want them!

So why, with today’s sophisticated customer management systems, are loyal repeat customers too often just an afterthought?  Or missed entirely?

In today’s post we will try to demonstrate that marketers must make extra effort to identify and appreciate these great customers.

Customer Relationship Management (CRM) data-based systems have given marketers the illusion that they not only know everything about their customers, but that their email outreach perfectly motivates everyone.  This is not always the case.  They don’t always get it right.  Customer targeting algorithms written too narrowly can miss the bigger picture.

Case in point: my very own Mom.

  • Mom’s primary indulgence is periodically taking her 5 kids and their families (20-25 people total) to an all-inclusive resort. Club Med has been the most frequent (but not exclusive) beneficiary. (Yes, I chose my mother extremely well). Her aggregate investment is well into 6 figures over the past 20+ years she’s been doing this.

ClubMed1

In the case of Club Med, the algorithm failed.  They were focused on the last 3 years only.  And they completely missed the fact that she’s a long-time customer who brings a group. Mom turns out to be a mere Turquoise!  A rookie in their eyes!

ClubMed2

ClubMed3

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ClubMed6

  • Mom selects the location, makes the reservations and all expenses go through her. She has 99% of the decision-making power on where we go. She should be a Big Kahuna to Club Med. They should make sure she’s happy, show their appreciation, and make every effort to acknowledge her loyalty.

ClubMed5

————-

ClubMed4

  • Yet Club Med scores loyalty on a per-person visit basis over the last 3 years. So despite influencing a lot of spending, Mom is classified as entry-level Turquoise, with the same status as a 10-year old who goes along with her parents. There is no acknowledgement at the corporate level, and none at the local Club level – – no one has told them who this is. No bottle of wine or fruit in the room. No upgrade. No ‘thank you for your continued loyalty’. Nothing.

ClubMed7

  • Small victory!  But it took a lot of effort.  Shouldn’t have to.
  • What defines your best customers? Longevity? Frequency? Cumulative $ spent?  Early adopters of new products?  This is really important to figure out.

Club Med of course doesn’t want to ignore their best customers. It’s just that their system isn’t set up to recognize them all the time.  To their credit, they handled my email rant with grace – – and came through in the end.

ClubMed8


ClubMed9

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So figure out who your best customers are and take care of them!

Right after you take care of your mother.

 

Comcast Hacks its Own Email Service! On Purpose! Really!

UPDATE TO THIS POST – – SOLUTION FOUND!  and not from Comcast.

A helpful reader sent me the following recommendation, pasted below in its poetic entirety.

go here: http://xfinity.comcast.net/adinformation/
sign-in
Opt Out
Turn Off

Done and done! So easy…stop bitchin’!

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He was right – – it did work, very quickly.  Why couldn’t Comcast send this solution?

Original post  (below):

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How does Comcast spell customer?        Apparently, ‘H-O-S-T-A-G-E’.

In a bizarre marketing gambit to generate revenue through its Xfinity email service, Comcast has not only demonstrated that it values advertisers over customers, it has shown that it has mistaken customer captivity for loyalty.

When you have customers in a market where there are available alternatives, you need to do 2 things: a) keep them happy with superior service; and b) try to avoid giving them a reason to switch.

Here’s what I recently experienced:

SmallXfinityAdLargeXfinityAd

  • Without warning, a square advertising banner appeared on the upper left of my screen, covering key email commands (select, delete, refresh, etc). Comcast thus made it impossible to use its own email.  This ad never went away.
  • A mouse-over converted this box into a larger, even more annoying video ad, in effect acting as a palace guard, to ensure that customers couldn’t even try to get to the controls and read their emails.   Footprint of ads shown below.

XfinityOverlap

  • Disabling this ‘feature’ required an email to Comcast, and resulted in a 6-step, byzantine preferences-changing process that ‘may take up to 30 days to take effect’ (see below). What? Complicated process + 30 days to opt out?  Do you want me to switch?

comcast note

 

– Comcast calls this program ‘Segmented Advertising’, and provides an explanation that it tailors ads to based on customers’ preferences. (Not exactly a new concept, but what if our preference is to just get our email?)

ComcastSegmented

The upside-down-ness of this program is hard to believe, and is proof that at Comcast there is some kind of crazy monkey at the steering wheel.

A hacker working for a competitor would be hard-pressed to create a more annoying disruption for Comcast users – and they’ve done it for themselves.

Let’s break this down:

  • The ONLY reason anyone visits an email page is to use email
  • Disrupting email utility therefore eliminates the reason to use Xfinity email
  • An opt-out approach FORCES ALL CUSTOMERS through the exercise of disabling (creating ill will), and forces customers to immediately try out an alternative (Apple Mail and gmail for me).
  • Taking up to 30 days to take effect provides a great trial period for competitive email services
  • And to complete the cycle, fewer users of Xfinity email of course reduces reach and effectiveness of the offending ads

I’ve blacklisted the companies whose ads continuously and annoyingly popped up. For the record, they are:

  • Blain’s Farm & Fleet
  • Walter E Smithe Furniture
  • Howard Jewelry and Loan – The Pawn that Pays
  • Grossinger Auto Dealers
  • McGrath Audi of Glenview/McGrath Acura of Morton Grove
  • Golf Mill Ford
  • Evanston Subaru in Skokie
  • Highland Park Ford Lincoln Superstore
  • Peter Francis Geraci – bankruptcy attorneys
  • Luna Carpets
  • Ambiance Window Fashions

Since I’m not in the market for a car, home furnishings, farm equipment, bankruptcy help or pawn services, I will survive.

Finally, I’m writing this post/rant to share my experience (I was perfectly happy a week ago, mind you) and hope you share it with someone you love.  Especially if they work for Xfinity.

Again, the lesson, said a little differently:  in a world with ready options, don’t piss off your customers.

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For those who are interested, below are screen shots of the process required to eliminate these ads (which hasn’t taken effect for me yet).

OptOut1 2 OptOut3 4 OptOut5 OptOut6