They fail to give their advertised discount (Part 2)
On August 30, 2004, I bought the computer from Alienware for $5460.21. They charged me $129 for shipping, even though they had advertised free shipping.
So, on August 30, 2004, I sent them a letter asking them to fix it.
Here's how they responded:
Response (Alienware Support Team)
08/31/2004 04:12 PM
Thank you for corresponding with us here at Alienware Sales.
In order to process a price reduction for the ‘Free Shipping’ promotion in a more expedited manner, please get in touch with any of our sales representatives in our Sales Department at 1-800-494-3382.
We would like to take this opportunity to reassure you that Alienware welcomes all of your input as feedback that can help us improve the quality of our support.
Should you need further information, or if you have any questions, or perhaps any concerns, please do not hesitate to contact Alienware’s Sales Department at 1-800-494-3382. Our office hours are from 9am to 9pm (Eastern) on weekdays and from 10am to 6pm on Saturdays.
Thank you for corresponding with us and for choosing ALIENWARE,
Electronic Support - Sales Department
Hey, I ordered this on the web. It was a promotion for online orders. I have to call them to get the discount?
My note to Alienware included the full confirmation, with the order number and all system details. They didn't need any further information from me to fix their error.
This raised a red flag about their integrity.
Let me state the flag baldly, then give you some background to help you assess the credibility of my judgment.
The problem is that American consumers are predictable. We walk away from business disputes as soon as they become a hassle. When cheated by a business for $100 or less, fewer than half of Americans will make a complaint phone call or demand a refund--unless the business has done something to make the dispute "personal." The number of Americans who will make a second call, then a third, then a fourth--drops off dramatically.
The simplest and most effective way to cheat Americans is to smile, be polite, and put little task (send another email, make another phone call, find another receipt) after little task in their way. A few will demand their due, so you pay them. The rest walk away and you keep their money.
This note from Alienware looks like a completely unnecessary hoop to jump through. That might merely indicate a poorly designed customer support process. Or it might indicate a well-designed process--well designed to reduce the number of people who will actually collect their advertised discount.
It's impossible to accurately interpret a single incident. A legal investigation would check the refund statistics across several promotions, looking for the pattern. Alternatively, one can interpret a course of conduct over time. In my case, I have the course of their conduct with me from August 2004 to July 2005 (so far). In my opinion, it has been shameful.
Based on the rest of their conduct with me, I am willing to believe that Alienware would intentionally advertise discounts that they don't intend to honor. I'm not accusing them of that--to know whether this was true, I would need appropriate statistical data (or a smoking gun memo). But what looked like an unlikely interpretation when this happened, in August 2004, now looks more possible.
My next step (stay tuned to tomorrow's blog entry) was to call them.
But today, I'll close with some background information to help you assess credibilility,
- about me and how I know how to interpret "red flags"
- about predictable customer response patterns and how to take advantage of them
Here's some background about me, and my knowledge
I started working in the software industry in 1983. I worked in Silicon Valley as a tester, programmer, tech writer, software development manager, product development director, and independent software development consultant. I managed the development of several products, including a few best sellers. I also wrote what became the best selling book on software testing, Testing Computer Software.
Along with the technical issues, I was deeply interested in the "playing field" -- the social context in which we develop and sell software. I worked for two years (part time, volunteer) investigating and mediating consumer complaints in the Santa Clara, California Department of Consumer Affairs. Then I went to law school, with a primary interest in the law of software quality. When I graduated, I got my trial experience by working as a full-time volunteer Deputy District Attorney, going to court to put criminals in jail. After that, as an attorney, I counselled independent consultants, technical book writers, and independent test labs on contract and intellectual property issues, and I did legislative work as a consumer protection advocate. In 1999, I was elected to the American Law Institute, which is a big deal for lawyers, especially for a lawyer who had been in practice for only 5 years.
From 1993 to 1997, David Pels and I researched and wrote another book, Bad Software: What To Do When Software Fails. David was a seasoned tech support manager. Our primary objective was to help people who had bought a defective computer program, with advice on troubleshooting their own problems, interacting with technical support, reporting problems to consumer protection agencies, bringing a lawsuit in Small Claims Court, and if necessary, hiring a lawyer to bring a formal lawsuit.
I had a history of close work with technical support groups. In fact, when I was test manager of Electronic Arts' Creativity Division, the company gave me its Award of Achievement for building bridges between the engineering and support groups. At another company, David Pels and I did research together on satisfaction and supportability of the customers who were buying the products my staff were developing.
Working on the book with David, I got a deeper, insider's perspective. We went to technical support conferences, interviewed software and hardware company technical support managers, interviewed executives who managed the departments that tech support reported to, and ran an experimental study of our own on different companies' technical support practices.
Background about predictable customer response patterns and how to take advantage of them
One of the consistent findings discussed at tech support conferences in the late 1990's was that American customers were unlikely to demand refunds or complain about defective products. We saw slide after slide summarizing data that as many as half of buyers would choose not to complain over a worthless product (or an overcharge) of $100 or less. The percentage dropped much further if they had to follow up with more than one call.
The problem isn't that American customers are lazy. Rather, as a culture, most of us are too busy, most of us have been raised to have disdain for complainers, and many of us have had enough bad experiences when we do complain to vendors that we've learned it is a waste of time.
The technicial support conferences looked at this from two angles, customer loyalty and call avoidance.
- Customer loyalty. Many businesses thrive on repeat customers. The question was, how do you keep the customers you have, and make them want to come back to you again and again? We saw varying statistics (they differed, for example, across industries) but as a rough indicator, a person who gets a defective product might be 20% less likely to shop from that company or that manufacturer again. A person who gets a second defective product is less likely still. Interestingly, a person who gets one defect, does call for support and gets supported well, is statistically significantly more likely to shop at that company again than if they had never had a problem.
- Call avoidance. I didn't make up this phrase, and I repeatedly counselled people to rename it call cost avoidance, but the phrase is still in common use. The idea is to reduce the cost of supporting customers who have problems. There are customer-friendly ways to do this--improve the user documentation, make a good support website, make better products. And there are customer-unfriendly ways--long waits on hold, blaming the customer for the problem and making them call back again and again and again.
The first thing that dishonest companies can count on is that most customers will put the product on the shelf rather than complain or return it. (That's where the word shelfware comes from--a product that you can't use, that you can't or don't return to the vendor. So it just sits useless on your shelf). I actually worked with a company whose marketing staff told me, flat out, "We make shelfware. That's our business." Many of these people will blame themselves for not being able to understand the product or not having the time to make it work, or they'll blame something else they have (maybe their computer is incompatible) instead of blaming their product. I had a personal introduction to this phenomenon when I became development manager for a new version of a product that had good historical sales. I commissioned a study of existing customers to get insight into their needs for the next version, and was shocked to discover that almost none of them were still using the product. They hadn't complained to us; they just paid their money, tried to use the product, failed, gave up and put the product on their shelf.
The next thing an unethical company can capitalize on is that most of the people who will call once will not call back. The conference presentations that gave statistics on this discussed their data in terms of potentially lost customers. ("They call you once, and if you don't take care of them that time, they aren't going to call back.") But the coffee-table discussions at the conferences, at the sites of a few of my clients, and in several of the interviews for Bad Software, people talked about using this to discourage complaining customers.
A practice that was intentional at some companies--I know it was intentional because it was described to me as intentional by people who did it, or managed the doing of it--is to tell the customer that the problem is with their video card (that was a favorite for years) or some other component of their system. Tell the customer to update their driver, or just find their current driver version, or reformat their hard drive, or do something--it doesn't matter what--anything that will get the customer off the phone and given them a task they have to perform before calling back. Few will call back. Most of the rest will blame themselves for not doing that next task, never realizing that the task was irrelevant to their problem, just a way to get them off the phone.
Sometimes added troubleshooting of your system's components is relevant. Sometimes, it is entirely the right thing to suggest to you that you reformat your hard disk, update your drivers, change the settings of your firewall, and so on.
I'm not saying that being told to do some troubleshooting means you are being given a runaround. I'm saying that a remarkable number of people have bragged to me that they were able to use troubleshooting tasks that were not necessary to get rid of unwelcome callers, because so few people who are assigned a task will ever call back with it done.
Even creating a simple callback requirement—the person you need is not here, you have to call back—will eliminate many complaints, and avoid many requests for refunds.
So, when someone puts an unnecessary hoop in front of you, think about what it means. It might mean that they are disorganized or bureaucratic. Or it might mean that they know exactly what they are doing, and are putting this in front of you to discourage you from going forward.