Published in Energy/Utilities

The Cost of a Bad Customer Experience for an ISP

Telecom Dream Becomes Nightmare But Has Happy Ending

Recently, I needed to have a hard-wired internet line installed at my house to be better able to work remotely. We already had service with this Internet Service Provider (ISP) but my wife had been involved with the original installation of the service. This time around, it was my turn to experience dealing with the ISP.

I was pleasantly surprised and extremely optimistic when I made the initial call to set up the service. I called on a Saturday and the customer service rep, Faye, could not have been more helpful.  For the first visit, Jake the technician showed up early. How bad could this be?

Short answer: pretty bad. It turned out that the information Faye provided to the technician was inaccurate. Jake thought he was going to install a telephone line, not a hard-wired Internet line, and he didn’t have the right equipment to install such a line. Jake told me this was pretty typical and a normal part of his job. Back to the phones, I spent an hour explaining what I needed, but the representative’s system crashed, and so I had to start over a couple days later. Rob the technician (on time, by the way), claimed he had no information about what he was supposed to do. He said there were absolutely no notes in the file. Rob said this was pretty typical. I asked him how frequently his company trained employees on new technology. He replied: “I had a little training over twenty years ago. Then, they blasted me with meat juice and threw me to the wolves.”

Telecom Story from a Customer Experience Perspective

For me, the two flash points in this situation were employee training and internal communication. I was really frustrated, but I couldn’t blame Faye or Jake or Rob. They were all doing the best they could with the training they had been given, and with the information they received. And, darn it, they were so nice.

At MaritzCX, we see situations like this as a clear sign that a company needs to take a look at how it is executing its customer experience. Our MaritzCX Evolution model measures 14 different competencies that are necessary for a company to reach the highest level of customer experience maturity.

My ISP experience alone suggests that for the ISP, some of these competencies are likely to receive low scores. In particular, the organization does not appear to be strong on training and shows inadequacies in developing processes to communicate the information that employees need to provide customers with a positive experience. The company also appears to struggle with integrating all of the information it does have on a customer. In my example, even the information or data on a single transaction was misaligned or lost, thus the disconnect in information sharing. Finally, in talking with the personnel at this ISP, it was clear that they do not share a common vision of who the customer is and what is important to that customer. This means that the customer will be dealing with different people at the ISP, all of whom have different ideas about what the customer wants. This makes it harder on both the personnel and the customer and creates additional confusion.

In short, the organization could do a lot better. And, as a customer, you wonder why they aren’t doing better. In fact, you wonder if they are even trying.

Telecom Story from the ISP’s Perspective

Giving the ISP the benefit of the doubt, the company has to be aware that its customer experience is not going perfectly. You don’t need a degree in economics to look at metrics on call length to resolve issues, number of repeat calls to resolve an issue, number of trips to complete installations, the amount of time spent on each of those trips, and the cost of gasoline to get there. These metrics would tell you that it is taking longer to accomplish what you are trying to accomplish than you’d hope and that this is negatively impacting the bottom line. However, the powers that make financial decisions often feel that the outlay to improve the customer experience will make the balance sheet go even further in the wrong direction and thus avoid making positive changes. But, does this make economic sense?

The Simple Economics of this Story

Let’s go back to my story. The cost for me to get my installation done was $39. When I do the math I think it is fair to assume that spending an hour and a half on the phone, and sending two different installers over 20 miles each way, each of whom spent about 40 minutes at my house, has got to cost more than $39. I estimate that with phone time, and about 3 hours for each of the installers totaling to 7.5 hours. Estimating an hourly cost of $10 for the employee salaries, which is most likely low, you get $75.00. Add in 80 miles at $.50/mile and you get another $40 for a grand total of $115.

Maybe the ISP makes it up in their monthly fees, but still, if I had had one phone call and one installer, the ISP would have gotten to keep a lot more of its money. I’m guessing I’m not the only one who ever had this situation happen to them, and if the ISP had worked on its customer experience, it would have gotten to keep a lot more of its money!

Of individuals who go through a bad customer experience with any company, some will leave, meaning that the company will lose the long-term revenue these customers could have generated. Many customers will probably stay, because they fear the same thing happening with whichever company they decide to purchase service from next. However, their staying may actually increase the long-term customer retention problem for the company. If company leaders become complacent and don’t change policies to fix customer issues, their inaction will propagate a slow bleed of customers, who could have stayed loyal if the company had just fixed the problem when it first arose. MaritzCX’s research over many years suggests that the type of problem I experienced with this ISP is probably not unique to the installation process. So, goodbye to more dollars.

So, does it make financial sense to avoid fixing customer experience problems that are causing companies to lose money? In the short run, the answer may be yes, because large Voice of the Customer experience programs typically involve a significant investment. However, in the long run, the answer should be that a company cannot afford not to make customer experience investments. Failing to do so will result in greater inefficiency, higher employee turnover rate, customer churn, and reduced profitability. And thus the simple economics of the situation suggest that leaving the customer experience to its own devices is a very bad idea.