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    325 points jemmyw | 11 comments | | HN request time: 1.03s | source | bottom
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    FateOfNations ◴[] No.45767064[source]
    At some point customer service died. Businesses of seem to no longer be interested in dealing with customers. Good customers come in all shapes and sizes, and often don't exactly fit a cookie cutter. It's frustrating to see businesses just cut and run the moment something becomes a problem that needs more than a series of pre-scripted responses to be resolved.
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    1. atmavatar ◴[] No.45767196[source]
    There was a time when the general consensus was that treating customers well would result in greater retention, which, in turn, would ultimately prove to be net positive profit-wise over time.

    It seems like that changed somewhere around the turn of the century, whereby businesses started to decide that it was better to cut down on customer service, and in some cases, go so far as to ban customers. The first cases of this I recall reading about had to do with Best Buy, and specifically their policy of banning people from their stores who made a lot of returns.

    I'm not really sure how it ultimately maths out - i.e., whether it's long-term optimal to drop troublesome customers or merely short-term optimal, and this was primarily taken from the perspective of retail.

    As such, I'm sure the math changes a little for subscription services. However, I also recall my prior employer's support activity followed a power law distribution across its clients, so it wouldn't surprise me if a policy to drop particularly noisy clients is a net savings there as well.

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    2. Normal_gaussian ◴[] No.45767756[source]
    For brick and mortar retail that isn't fast fashion or supermarkets, dropping troublesome customers is generally extremely sensible.

    Profit on most goods is low - single digit % typically - and a single return can eliminate the profit margins on a dozen sales. Sometimes cost can be reclaimed from goods providers - i.e. genuinely defective or manufacturer refurbishment programs - and sometimes they can resell the item as new. But if the item has been used, broken by the customer, etc. the loss is significant. It turns out that some people are more honest than others, and some people are directly trying to scam companies.

    When one 'dodgy' customer can eliminate the value of 10 'real' sales with every return the maths say to ban people quickly.

    A little anecdote - I have a distant relative who, circa 2005, would buy a vacuum cleaner use it, and then return it. He rotated stores (hardware stores, supermarkets, electronic stores) until he gradually got banned from them all. Once that happened he moved house. Not only had he almost certainly spent more in time and fuel than a reasonable vacuum would have cost him (which I will note he could afford); but the cost and waste he has incurred on both individual companies and society at large through that and similar schemes is staggering. I don't know if he's still at it - or alive - but the people he was surrounding himself with all saw such behaviour as reasonable.

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    3. chii ◴[] No.45767801[source]
    > treating customers well would result in greater retention, which, in turn, would ultimately prove to be net positive profit-wise over time.

    may be true in the past, but a business cannot scale up good customer service - it's at best a linear scaling, where each new customer costs the same fixed amount due to needing high touch/people to manage that customer.

    With the internet, businesses have found scaling to work better by ensuring your fixed costs stay fixed even if you scaled up customer count - this includes support/call centers etc. Without doing this, the business cannot scale up exponentially.

    4. csomar ◴[] No.45768904[source]
    It did "math out" because these industries heavily lobbied and regulated that starting an alternative is close to impossible. Think about Wise: How many companies out there have the same service? The closest are Revolut and Airwallex. So in a world of 8 billion people and millions of businesses, there are only 3 companies that do the same thing that Wise do. In comparison, there are thousands of banks around the world.
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    5. tdeck ◴[] No.45769066[source]
    > It seems like that changed somewhere around the turn of the century, whereby businesses started to decide that it was better to cut down on customer service, and in some cases, go so far as to ban customers.

    You missed the first step, which is to burn though tons of cash offering your services below cost, driving all competitors out of business. Then once you've done that, where else are they going to go?

    6. cjs_ac ◴[] No.45769782[source]
    Wise's USP is a consequence of the way the US banking industry works (possibly as a result of US regulation). Free and instantaneous interbank transfers are ubiquitous in other banking systems, as are low-fee international transfers.
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    7. graemep ◴[] No.45770688[source]
    > net positive profit-wise over time.

    There are definitely many customers you should drop, but business are not even that interested in retaining profitable customers. The problem is with the "over time".

    Management are rewarded with bonuses and options that focus on the next few years so they are not really interested in how profitable a customer will be over the next ten years, only over the next one or two. Small businesses and family owned businesses are different, but for a big, widely held, professionally managed business the incentives are all short term.

    8. graemep ◴[] No.45770703{3}[source]
    Wise is a British company with lots of customers around the world, the article is by someone in New Zealand.

    It is cheaper than British banks for international transfers. Its business accounts are both easier to open and cheaper to run than those of the banks.

    You are right that transfers from personal bank accounts in the UK are usually free and rapid (usually immediate, guaranteed to be within two hours), and similar or better in many other places, but Wise still has an offering beyond that.

    9. jimmydddd ◴[] No.45771369[source]
    A family member helped start up a call center for UPS back in the 90's, for their shipping software. The problem she was working on was that the average time for a call to be answered was 60 seconds, and they were trying to get it to 45 seconds. They also had formal tiers of agents that could quickly escalate a call to a technical expert if needed. The golden age of call centers I guess.
    10. lmz ◴[] No.45778620{3}[source]
    Low fee international transfers are not ubiquitous unless you're talking about SEPA.
    11. jlaternman ◴[] No.45779162[source]
    All true, I have no doubt, but this experience has weighted your judgement here IMO. That isn't the force at play in modern customer service policies.