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ECommerceTimes.com

Squandering Customer Loyalty Is Risky Business

By Jeff Kagan
Mar 22, 2018 5:00 AM PT
customer-loyalty

Customers often make investments in their relationships with the businesses they choose to patronize. There is plenty of competition, so companies must pay attention to this. It's only when a company respects and wants a customer as much as the customer wants the company that things will go well, and a long-term brand relationship will be created.

However, when a company focuses only on itself and hurts its customers, it sets itself up for disaster. Too many companies are damaged by this behavior.

Every company makes mistakes, because policies are created by people. It's what happens after a mistake is made that matters most. Does the company care? Does it want to protect its long-term customer relationship? Some companies do. Surprisingly, many don't -- either through ignorance or by design. That's unfortunate.

Massage Envy Rubs Customers the Wrong Way

When Massage Envy opened near our home more than a decade ago, my wife and I were lured by the low-cost membership. The way it works is that the customer pays a monthly fee and gets one massage per month. Every additional massage has to be paid for. Fair enough. For more than a decade, we have enjoyed the people, the experience and the company.

The problem is that we don't go for a massage every month. Eventually, we reached a point when we had 17 massages stacked up, with another one added every month. I asked the business to suspend my monthly fee while we got caught up.

The staff were very nice, but they could not help. The business is a franchise, and there were no rules to help customers in our situation. They suggested I call Massage Envy's customer service.

I tried. I checked its website and found no customer service number. The only customer service link was to the Web page, which advised calling the location -- but that's where I had started.

Massage Envy had me running in circles, looking for help where none could be found. With my request unanswered, I'm left with no choice other than to use up my services as quickly as possible.

Then I will decide whether to keep our membership or join a competitor. We like the local business, but Massage Envy doesn't take care of its customers. That is especially disappointing, considering that we've been good customers for more than a decade.

LA Fitness Turns Its Back

Another company with customer care problems is LA Fitness, a fast-growing health club. When I joined, it was a good experience, so I signed up my son. He used the club and liked it as well.

However, he stopped using the club several years ago. He told me he had canceled the membership. Yet a check of my credit card statement showed the club continued to bill me for US$75 per month (that was double what I'd signed him up for, which was another issue).

When I contacted the club about both problems, the staff said my son's records showed that he had stopped using the facility years earlier, but there was no record of his cancellation. They said they would cancel the membership going forward, but they refused to offer any refund for the unused membership period, which added up to several thousand dollars.

So, LA Fitness charged me for double the membership fee I'd signed up for and kept doing it for years, even with no use. It offered no help to a loyal customer.

Shouldn't the club have given the member a courtesy call to check in after an extended period of no use? Shouldn't it have asked for permission to double the monthly fee? It would have done both of those things if it respected its members. I guess what their actions illustrate in this case is a company that does not care.

I am no longer an LA Fitness fan or member, and I now tell friends and family about this problem to help them from making the same mistake. Actions have consequences.

Walmart Fails to Tell the Whole Truth

I love shopping at Walmart. It has done a great job of brand building. When Walmart started to compete online with Amazon a few years ago, I thought it was a great idea. In fact, I thought it was more convenient in certain ways, since you could make purchases online and take returns to a store.

It worked great for several purchases, until Walmart burned me. I purchased something online, didn't like it, and tried to return it to the Walmart store. The staff there could not figure out how to handle the return. I went to a different Walmart store. Its employees couldn't do it either. To make matters worse, no one had a clue what the problem was.

Turns out, I didn't make the purchase from Walmart. Instead, I had purchased the item from a small, mail order business that used the Walmart website to reach customers. I did not know about this arrangement when I made my purchase.

The fact that I was dealing with a third-party seller was not explained on the Web page. It wasn't noted on the receipt emailed to me. In fact, there were several emails regarding the transaction, but none mentioned that I was buying from a company other than Walmart. Had I known that Walmart's policies did not extend to that sale, I might not have made the purchase.

I had to return the product to the small company, which took a 15 percent restocking fee -- another surprise! The whole transaction was a disaster. My complaints to Walmart fell on deaf ears. I have heard nothing from the company -- no apology and no resolution.

That's too bad. I used to like Walmart. I used to trust it. After getting burned, I no longer do. This is Walmart's loss -- it shot itself in the foot. However, I don't know if the company even realizes it. Now I no longer buy from the Walmart website, because I know the company can't be counted on to take care of its loyal customers.

Companies That Disregard Customers

Every company shoots itself in the foot now and then. It happens. What happens afterward shows the difference between companies that care about their customers and those that simply don't.

When a company admits to its mistakes and does everything in its power to make up for them, customers will stick around for the long term. Customers don't expect perfection -- they want good relationships.

Companies that don't invest enough into customer care often burn their brand value in the marketplace. That is something you'd think every company would want to avoid. Unfortunately, there are too many companies that don't care.


Jeff Kagan has been an ECT News Network columnist since 2010. His focus is on the wireless and telecom industries. He is an independent analyst, consultant and speaker. Email Jeff.


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Which capabilities in a home robot might induce you to consider buying one?
Help with daily housecleaning chores
Companionship for elderly or disabled family member
Entertaining and educating children
Monitoring security all through the house
Keeping inventory and restocking items when needed
Nothing would persuade me to consider getting a home robot.