Punishing Customers

How we deal with children has changed dramatically since my youth, and if you were to believe the stories of our parents, even more so since their day.  The paddles hanging behind my teachers’ desks had one-inch holes drilled across the surface, and when asked why, we were told so that the paddle moved more swiftly, more painfully, with less air resistance.

Punishment is a strange notion, with deep roots in our culture.  While we may not emblazon scarlet letter A’s on anyone’s frock, or humiliate anyone in the town square shackles, it is central to our entire justice system.  Still, it is odd to encounter companies punishing their own customers – the people who have just reached into their wallets for their credit cards, and allowed the company to take some of their hard-earned lucre.

Medieval torture rack used to punish customers

In medieval times, torture devices were used in punishment.

I experienced an example of being punished by a company this very morning, when I purchased a copy of speech recognition and transcription software.  I had two choices: order the CD for $150, or get the digital version and download, also for $150.  Wanting it immediately, I made the digital purchase, doing my part to save the environment from landfills overflowing with discarded CDs – not to mention avoiding the extra costs of shipping.

If my computer crashes in a couple of months, though, I’d need to reinstall the software – but in order to download after that time period, I either need to pony up an extra $9.99 for a backup CD, or purchase an extended download for a little less. As maintaining the digital download on the part of Nuance has no cost to them, this is simply punitive and mean-spirited; a horrible way to start a relationship.

Spirit Air is another company that has built a sense of punishment in their offerings.  If you get to the gate without having checked in your second carry-on, you get charged $100, more than double the charge if you book the carryon when purchasing your ticket.  It’s no wonder that Spirit Air has been referred to as the American Ryanair, whose CEO famously called customers “stupid” for not printing out their boarding passes (thus incurring an extra fee).

Lest this post simply come across as a rant against another instance of horrible customer service, let’s consider what this might mean for our own businesses. What charges or processes do we have that punish customers?  Can we institute an annual review – seek out those punishing elements, and get rid of them as fast as possible? After all, if we learn from horrible customer service when we encounter it we can actually receive value from the experience – and if nothing else, at least the punishment will be a little less brutal.



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6 comments on “Punishing Customers

Paul Rakov

There are so many examples of companies doing customer service, it’s hard to think of examples of how people do it right.

But I also know from working for big box retailers and in the hospitality industry that a lot of these “punishments” arise from consumers gaming the system. For example, while at Circuit City, I learned that we charged a “restocking fee” of $100 or more for big screen TVs that got returned. When asked why, I was informed that those fees came about because people would buy a TV just before a big event, like the Super Bowl or the Olympics, and then return it within the 30-day return window. Now the company had an “open box” item it couldn’t sell as new and the consumer got to use the product for free. It’s also why you couldn’t return CDs (consumers would copy them and return them), there was a short return window and restocking fee on laptops (people would take them on a trip and then return them) and a similar situation with video cameras (people would record a special event like a wedding and then return the camera).

One example from the hospitality industry was with weddings. Believe it or not, there used to be no deposits required to reserve a space for a wedding. But that all changed once people started reserving several locations, giving themselves time to make up their minds. They would then cancel all the other venues somewhat late in the game, leaving the hotel/resorts with an open weekend to fill.

It is too bad that a few bad apples spoil the bunch in a lot of aspect’s of life. But as long as they keep doing it, companies will have to implement policies to protect themselves.

All that being said…shame on Nuance and SpiritAir!

    Ric Dragon

    Excellent thoughts, Paul – and you could say the same of companies that are in the show business – yet Zappos has created competitive advantage from their free returns policy. It’s possible that even the losses associated with those tv sets at BestBuy may have been offset by other purchases and customer loyalty. Just possible…
    And then, in the case of SpiritAir (or Ryanair) – they are adhering to a notion of brand polarity – really only wanting those customers that cherish them for their non-customer-care aspects – and by helping polarize those brand advocates even more.

      Paul Rakov (@PaulRakov)

      Man…who cherishes a company for their “non-customer-care-aspects?” I guess it takes all kinds of people to make the world go around!

Ric Dragon

This post at Dennis Yu’s blog is a great example of a company (in his case, Southwest Airlines) punishing a dedicated customer. http://www.dennis-yu.com/how-to-lose-293-60-on-southwest-airlines/

I’ve used the word “punish” recently in reference to YouTube. I often watch very long YouTube videos — of 20 minutes to an hour or more in length. I don’t always have the time to watch the entire video, and tend to watch them in increments. However, whenever I switch from full-screen mode to normal mode, YouTube resets its ad allocation, and feeds me an ad. When i return to watch the video later, YouTube has reset its ad feed again, forcing me to watch up to three ads in what sometimes turns out to be less than 5 minutes of video. Essentially, they’re punishing me for not watching the video in its entirety by making me watch a large volume of additional advertisements.

Additionally, they repeatedly punish me for using their (still available) option to use YouTube anonymously. At least seven times, I’ve been asked by the ‘Tube if I would like to switch to using my real name (because I was forced to link it to a gmail account), and when I (again) say “No, I wouldn’t”, they often force me to explain why I wouldn’t. I know _they’d_ prefer me to use my real name, but sometimes I’d prefer not to make my entire YouTube history public knowledge. They make that preference an option, but they punish me for choosing it. What’s the deal?

In my opinion, and from the perspective of a digital marketer, punishment doesn’t necessarily need to be financial; it can be as intangible as an inferior user experience.

    You bring up some really good points, Jacques. Those ad streams are even more bothersome when it loops through the same ads again and again. As for the anonymous youtube browsing, I’ve found that Google walks a fine line between incentivizing broader adoption, and then outright forcing you into it. It’s the reason I have two google plus accounts; I simply wanted to use hangouts with my work email and that was my only option. Very frustrating.