The cost of a dissatisfied customer – part 2

apple logoSince writing the original post, I’ve been inundated with stories from friends and colleagues who have been on the receiving end of short sighted decisions related to customer service. Decisions that have adversely impacted loyalty to brands and companies and have deprived these organisations of future sales and related profit, in addition to a heap of negative word of mouth. One particularly good example came in a friend’s experience with Apple and I personally don’t tend to hear much negative press around their customer experience. I think however the brand creates a bipolar effect with customers – like marmite – you either love it or hate it. Anyway the story goes like this..

The screen on a new iphone belonging to my friend cracked, allegedly in a pocket of a jacket and not as the result of being dropped or mistreated. So the phone and owner went to an Apple store to request replacement screen, hopefully free of charge given the ‘accidental’ nature of the break. Clearly, the store staff were having none of it, and stated that ‘screens don’t crack on their own’ – which interestingly one could argue implies my friend was lying and behaving in a deceitful manner to defraud Apple! They of course offered to repair the iphone screen though at a cost of £60.

After much protest, she left without the screen being replaced (or part compensation offer from Apple) and got the screen replaced elsewhere.

Now to see it from Apple’s perspective, it could be argued that if they gave a free repair to one person, then they would have to give it to everyone and that would cost them a significant amount of money and so products would be more expensive etc etc. Another argument to not giving things away for free is that a small minority of customers are, in reality out to take advantage, especially of large organisations (insurance companies are good evidence of this) but I think companies sometimes use this as a convenient excuse.

Alternatively they could offer everyone, one free repair but all other repairs are paid for. However on this occasion they chose to do nothing. Now here’s the impact of the £60 decision.

My friend, unbeknownst to Apple, was also in the market for two Macs and a tablet over the following weeks which equated to about £1,900. Can you guess what she did? Exactly right – the money was spent elsewhere first off and not on Apple products. Then she started telling friends and family about the whole incident (including me) and you know how the rest goes. I’m not saying Apple were wrong, but there’s always more than one area that’s impacted by a decision like this. There’s bottom line finance, future opportunity profit, service experience and brand reputation and it’s all these elements that should be taken into account when decisions are made.

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