Technology Service Providers Could Learn Something from Retailers

Discussion
Jun 16, 2006
Avatar

Commentary by Bill Bittner, President, BWH Consulting

I have worked with retailers throughout my professional career. Retailers understand
customer service. They understand the need to identify customers “wants and
needs” and then to develop a service structure that satisfies them. Retailers
understand that the same products are available at a competitor’s store and,
if they cannot meet the consumer’s requirements, their competitor will.

Technology companies, such as phone and cable providers, have completely missed
the point. Instead of viewing their business as a consumer service, they view
it as a way to “monetize their capital investment.” The goal is not to provide
the best possible features for the least cost, but rather to maximize revenues
from their sunk investment in the network infrastructure. This leads to the
bundling of services and artificial limitations on performance to create a tiered
pricing structure so that additional charges can be assessed. Internet service
providers, such as the cable companies, also enjoy political support as recent
legislation has reinforced their right to decide who can have access to the
network.

The classic example of the technology companies’ attitudes was the cell phone
number system. For years, it was “Impossible” to transfer your number to another
provider. This technical hurdle was finally surmounted, not by an electrical
engineer working hard into the night to discover a new switching algorithm,
but by a legislature that finally had so many complaints from individual constituents.
The legislature had to ignore the huge political contributions from the service
providers in order to pass legislation that required them to develop the capability
(which probably always existed, but maybe not).

Moderator’s Comment: What do you think? Is there something
that phone companies and cable companies can learn from retailers? What have
been your experiences?

I really believe there has to be an effort to put more competition
into the internet service environment or, at the other extreme, monopolize it
and control it as a public utility. “Net Neutrality” is the buzz word right now
regarding tiered pricing on the internet. The debate is whether cable and phone
companies should be able to charge “content providers,” those folks who maintain
websites such as Google, Yahoo, and your favorite garage band’s server, different
prices for internet access or even refuse access if they don’t like the content.
The Internet Service Providers (ISPs) want to be able to charge different amounts
because it is another source of revenue for their sunk infrastructure investment.
I wonder how the legislature will vote?

If you have a broadband connection, here is a good video
explanation of the debate:
Net
Neutrality – YouTube.com


Bill Bittner – Moderator

Please practice The RetailWire Golden Rule when submitting your comments.

Join the Discussion!

7 Comments on "Technology Service Providers Could Learn Something from Retailers"


Sort by:   newest | oldest | most voted
Kenneth A. Grady
Guest
Kenneth A. Grady
14 years 8 months ago

It seems like the discussion is drifting between customer service and product offering. Retailers (brick and mortar) provide customer service typically through direct interaction in the store environment. The product offering (non-food retail) is fixed, but the experience can be improved through the quality and depth of customer service during the interaction. This is an area where, as Race points out, retailers would like to think they excel but for the most part do not.

Our complaints about cable and phone companies typically fall into both the product offering and customer service categories. These companies don’t feel compelled to offer more attractive bundled or unbundled products because they don’t feel a competitive need to (others offer similar bundles). The customer service disappointment comes when you want to get something they do offer (installation, change in plan) and you get bogged down.

Cable and phone companies need to feel competitive heat before they will change their product selections.

Mark Burr
Guest
14 years 8 months ago
I think there is a huge difference between execution or offering and “customer service.” Let me explain. I have had multiple experiences with my provider, Comcast. Each and every time I have dealt with them (and it was many times during my conversation to high-speed at home) was absolutely terrific, and I mean fantastic! So what’s the problem? If you differentiate “customer service” from “execution” or “offering,” there lies the problem. The problem wasn’t that I wasn’t treated wonderfully both in their local office, on the phone and on-line. (And, there really were literally dozens of contacts for one single service) The problem was that these wonderfully nice, very prompt, very professional folks couldn’t deliver a thing. It was literally uncanny! I would have thought it was just maybe one or two along the way. No! It was every single one, every time. I really have come to believe that the only reason that my cable internet connection even works is by some divine intervention. So, is customer service all inclusive? Is it also the… Read more »
Mark Lilien
Guest
14 years 8 months ago

Cable and telephone providers’ roots: local monopolies and shared oligopolies. Customer service isn’t a priority when profits are available via monopoly pricing and oligopoly price collusion. Often retailers have lousy customer service because they feel that their margins are so poor that they can’t afford anything better. Many retailers are certainly not positive role models for customer service. The best way to improve telecom service: encourage disruptive new entrants. The best way to encourage great retailer customer service: you’re voting at the cash register.

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
14 years 8 months ago

When the only tool you have is a hammer, every problem becomes a nail. And when the only widget you have to sell is connectivity, then every problem becomes connectedness.

Retailers typically sell lots of widgets that solve lots of problems. Their holy grail is selection. How can sellers of just one product learn from sellers of thousands of products? That’s right, they can’t.

Odonna Mathews
Guest
Odonna Mathews
14 years 8 months ago

Phone companies and cable companies can learn a lot from retailers if they focus on the future. The importance of long term customer loyalty built over many years of consistency in service, great product selection and overall value is key. Advertising campaigns are only “real” in the eyes of the customer. Focusing on the customer while still focusing on the bottom line is essential.

Bernie Slome
Guest
Bernie Slome
14 years 8 months ago
Retailers have a good handle because they do the market research, the focus groups, the exit interviews the IVR and the mystery shopping. In other words retailers learn what the customer wants, they measure the delivery to the customer and then they modify behaviors to improve the service that they are delivering. Cable companies and phone companies don’t a) consider themselves retailers and b) learn, measure and modify behaviors. Cable companies and phone companies see themselves as service providers. If they offered better customer service they might even see some additional return on their infrastructure costs. Why? Because without significant customer service improvements, a consumer shops on price and price alone. Therefore there is limited, if any at all, loyalty to a provider. That’s why many cell phone users switch carriers whenever a better price becomes available and their contract allows them to jump ship. Yes, they can learn many things from the retailers. The question is, when will the cable and phone companies realize that customer service is important to implement and not just… Read more »
Race Cowgill
Guest
Race Cowgill
14 years 8 months ago

Wonderful points, Bill. From our firm’s view, if you go one layer deeper, retailers and cell/cable companies actually have the same problem. Over 90% of retailers report that their customer service is good or excellent, but as we have said here many times, and our data confirms, actual service levels in retail are quite low. Our study of all the major cell and cable companies reveals the same: every major cell and cable company reports that their customer service levels are very high, but the levels are actually very low.

Each cell and cable company is controlled, as is every organization in the world, by its Master System. This System prevents a cell and cable company from knowing the importance of customer service, from knowing the cost of poor service, from knowing what their actual levels of service are, and from being able to do anything about it. Most important of all, each Master System prevents the company from knowing that a Master System exists and that it controls the company.

wpDiscuz

Take Our Instant Poll

Should phone, cable and internet providers be held to the same customer service standards of retailers in a competitive market?

View Results

Loading ... Loading ...