AT&T Bombs on Customer Satisfaction, Quibbles Over Grade

AT&T ranks as the lowest-scoring cellphone service provider in a new Consumer Reports survey that asked 58,000 customers to rate their carriers. AT&T was the only one to drop significantly in overall satisfaction from a year earlier.

Consumer Reports gave a preview of the results in a blog post on Monday — the full report will appear in the magazine’s January issue due out Wednesday.

More than half of the of the survey respondents who used AT&T as a carrier owned some version of the iPhone, the Apple smartphone that is exclusive to AT&T. iPhone users indicated much less satisfaction with their carrier than owners of other smartphones.

Popularity May Be the Culprit

“A lot of AT&T’s problems may be because of the popularity of the iPhone. The iPhone uses a lot of data,” Allen Nogee, principal analyst for wireless technology at In-Stat told the E-Commerce Times. “Verizon has great ratings, but we’ll see what happens if they get the iPhone. Their ratings may go down.”

If or when Verizon gets the iPhone, there may be a wave of users switching away from AT&T. “These users went to AT&T just for the iPhone,” Nogee pointed out.

The iPhone’s popularity may have lulled AT&T into being lazy.

“The iPhone has allowed them to live with some network degradation,” Michael Morgan, senior analyst, mobile devices for ABI Research, told the E-Commerce Times. “There is a strong draw with the iPhone, and it drew customers to AT&T and kept them there. So AT&T may have saved on network upgrades. The iPhone kept them from having to compete on network capabilities.”

AT&T Argues for Its Quality

AT&T’s customer growth indicates people are finding something right with its service, the company insists.

“We take this seriously, and we continually look for new ways to improve the customer experience,” AT&T spokesperson Jenny Bridges told the E-Commerce Times.

“The fact is, wireless customers have choices, and a record number of them chose AT&T in the third quarter — significantly more than our competitors,” she said.

AT&T’s own data refutes the findings in the Consumer Reports survey, the company maintains.

“Hard data from independent drive tests confirms AT&T has the nation’s fastest mobile broadband network with our nearest competitor 20 percent slower on average nationwide, and our largest competitor 60 percent slower on average nationwide,” said Bridges. “And, our dropped-call rate is within one tenth of a percent — the equivalent of just one call in a thousand — of the industry leader.”

Is the Network the Problem?

Cellphone carriers use different frequency bands for their networks. Part of AT&T’s problem may lie in its network frequency.

“One interesting part people are forgetting is that the carriers use different bands,” said Nogee.

“AT&T band is high frequency, and that’s more difficult because it doesn’t penetrate buildings well. AT&T has a disadvantage from the start,” he explained.

“Verizon has an advantage because of their band,” Nogee continued. “It’s a great band. It’s easier for Verizon to put a network out. That’s part of why the survey looks the way it does.”

Another factor in play may be how each carrier is building out its network.

“AT&T may be focusing more on coverage first, then bringing the whole network up, while Verizon may be focusing more on quality then moving to more coverage,” said Morgan.

Still, there are factors other than network quality, he noted. “These ratings are not just about coverage — they are also about customer service issues.”

At any rate, the survey is a snapshot it time — perhaps just a momentary bad time for AT&T.

“It breaks down to this: What was their strategy and approach? Wait a bit,” said Morgan. “I won’t be surprised to see AT&T’s quality go up.”

1 Comment

  • You failed to mention that Verizon has no fallback network. If AT&T’s 3G goes down, customers are still able to use EDGE as a fallback in a worst case scenario situation. AT&T continues to invest millions of dollars in their network every day. If the network was really as bad as you are claiming, customers would not continue to come over to AT&T’s service, iPhone or no. Even if Verizon gets the iPhone, their network does not support voice and data simultaneously like AT&T’s, which is going to be detrimental to thier customer satisfaction. I doubt this will be any different with their launch of "4G." This says it all: "The fact is, wireless customers have choices, and a record number of them chose AT&T in the third quarter — significantly more than our competitors."

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Sweetwater’s Well-Tuned Marketing Is Music to Shoppers’ Ears

Sweetwater music store in Fort Wayne, Indiana

The Sweetwater Music Store in Fort Wayne, Ind. (Image Credit: Sweetwater)

Companies like Wayfair, Etsy, eBay, and many others in this troublesome inflationary era, struggle with an e-commerce reset as more consumers return to in-person shopping.

MasterCard has said that in-store shopping increased 10% in April, while e-commerce sales slipped almost 2% from a year ago. Even Amazon seems bruised with a 3% decline in online retail sales in Q1.

Amidst this back-to-store shopping trend, as large companies try to work through e-commerce mishaps, musical instrument and pro-audio retailer Sweetwater has seen an increase in online sales. The company attributes much of its success to top-of-the-line experiences both online and through its unique one-on-one personalized customer service.

The macro-economy is tough right now, and the pandemic created a ripple that will continue to disrupt for some time, according to Mike Clem, Sweetwater’s chief growth officer. Still, he sees plenty of headway for smart retailers who can win on personalization, promotion, and value-add.

Mike Clem
Chief Growth Officer at Sweetwater

Retailers hear that strategy all the time lately. For Sweetwater, however, the approach has proven effective. When Clem started in 2003, Sweetwater’s website did $4 million in sales. Last year the company announced that it surpassed $1.43 billion in sales and facilitated 4 million orders.

“Sweetwater is fortunate to be in an industry that was accelerated by Covid. Many people picked up a musical instrument for the first time, or re-ignited a hobby, or invested in streaming and online performances. Now we are seeing those customers return to upgrade their instruments or buy more accessories. Retention is strong in [this] high-passion category of ours,” he told the E-Commerce Times.

Going Behind the Music

The E-Commerce Times discussed with Clem what other online retailers can learn from Sweetwater’s fine-tuned personalized marketing approach.

E-Commerce Times: Is Sweetwater’s impressive sales growth the result of its music-related product line and/or its e-commerce platform?

Mike Clem: A great deal of digital innovation fuels our growth, but the heart and soul of our company is actually a team of 600 “sales engineers.” They are the most highly-trained advisors in our industry with prestigious music backgrounds and incredible gear knowledge.

They are available to help customers shop online, by phone, SMS, or email. Then they stay engaged after the purchase to provide support and advice. This follow-up is what develops true relationships and helps to propel customers toward their musical goals.

What trends do you see evolving as the pandemic’s impact slows down?

Clem: I think we are seeing most categories beginning to normalize. Depressed categories like apparel are recovering — even surging — and elevated categories like home goods are pulling back from their peak. Many retailers had a surge of new customers during the pandemic and now is the opportunity to re-engage with them and create repeat business.

As more shoppers return to in-store purchases, what is the impact on e-commerce?

Clem: Many of us discovered great new brands as we pivoted to online shopping during the pandemic.

Many of us bought items that we never would have considered buying online previously. Retailers that provided great experiences have an opportunity now to retain those customers and not see everyone retreat back to in-store purchasing.

How are the supply chain interruptions affecting the stability of online shopping?

Clem: Our supply chain continues to be significantly disrupted. We are finding success by focusing our website on items that are confidently available. We use artificial intelligence (AI) and humans to suggest alternatives.

This optimizes our advertising in the most disrupted categories. It increases our communication with vendors about the product demand we are seeing.

What are your most popular products?

Clem: We are the largest dealer for many of our instrument brands; guitars, drums, keyboards etc. But we are best-known for our expertise in recording and live sound technology for musicians, schools, churches, pro studios, home recording, and such.

One exciting category right now is audio equipment for online streaming and content creators, which exploded open during Covid.

Sweetwater Recording Equipment Room

Sweetwater Recording Room (Image Credit: Sweetwater)

Sweetwater has a large physical store in Fort Wayne, Indiana. Do you have any other retail outlets?

Clem: We have one flagship store on our campus in Fort Wayne, Indiana [pictured above]. It is a unique “destination” store because we have so much gear available for you to hear and compare in one location. We have nearly 50,000 items on display and in our warehouse. It’s over-the-top. Customers will drive from many states away for that experience.

Bass Guitar Room at Sweetwater

Bass Guitar Room at Sweetwater (Image Credit: Sweetwater)

What sets apart Sweetwater from music stores with many more physical locations?

Clem: We have worked hard to create the best online shopping experience in our industry with the most professional and knowledgeable experts all in one location, not fractured across many stores.

We win by providing the most value, by “wowing” our customers in every interaction, and by truly getting to know them at a personal level so that we can be a valuable partner on their musical journey.

Musical instruments are a prime example of products that consumers traditionally went to a physical store to try before buying. How has Sweetwater overcome that obstacle to succeed at e-commerce?

Clem: That’s right. It is often an emotional purchase. But it is hard to find good local stores that have a large selection or professional advice, especially for complex technology products.

We bridge the gap by offering great advisors and a ton of rich media to help you research. For example, we photograph most guitars that we receive so that you can examine it in great detail and choose your favorite one.

Sweetwater Guitar Photographer

(Image Credit: Sweetwater)

It also goes through a 55-point inspection process that ensures it is actually better quality than most guitars hanging on the wall at local stores.

Many of your products are quite large and/or heavy. Those must be costly to ship. What challenges and solutions can you share about your fulfillment process that allows you to remain competitive in terms of pricing?

Clem: Free shipping is table stakes these days. So, we are just deeply focused on operational efficiency. That involves things like optimizing our carrier mix, packing materials, intelligent boxing, and combining orders. We are also excited to be expanding into additional distribution centers to be closer to our customers with faster shipping times.

Sweetwater Distribution Center

Sweetwater Distribution Center (Image Credit: Sweetwater)

What does Sweetwater do to help minimize returns?

Clem: We have a very low return rate for three reasons. We provide a tremendous amount of rich online content to help shoppers research; we have experts available to help customers understand complex products and make sure it is right for their specific needs; and we provide free technical support after the sale to make sure everything is working for them.

Sweetwater invests heavily in marketing. How important is that to the company’s success, and which channels perform best for you?

Clem: We focus our marketing on awareness and acquiring new customers. Then we enjoy very strong retention because our team focuses on amazing experiences and nurturing relationships.

We have a sophisticated search engine marketing (SEM) program, and we are also finding great results with influencers and affiliate partners in our high-passion industry. Like many retailers, our current focus is to reduce dependency on SEM as the costs per click (CPC) continue to shoot up.

Your website has many video demonstrations and testimonials from professional musicians. Tell us what goes into that production and maintaining the relationships with vendors and performers.

Clem: We have worked hard to earn our reputation as the “research destination” in our industry. We have a large in-house team of experts and artists who research products and then produce custom descriptions, photos, spin photos, rich media, audio, and videos. Customers know they can find the most in-depth product information on our website.

More E-Commerce Tips From Mike Clem

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

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Sports Betting Platforms Gambling With Substandard CX

Online gambling is at an all-time high in accessibility and popularity. But many betting app developers are rolling the dice blindly without addressing users’ customer experience (CX) concerns.

More states in the U.S. are legalizing sports betting with legislation pending in many others. Major sports leagues such as the NFL and the PGA Tour are adding legitimacy to the organized sports betting space by securing high-profile gambling partners. Sportsbooks like FanDuel, DraftKings, BetMGM, and Caesars are expanding in concert.

With money on the line, literally, with betting apps, these companies have a heightened burden to provide customer support. That could well be a survival requirement since many of their online bettors have never previously gambled on sports, let alone placed bets via mobile apps.

Appeasing Regulators

So far, sports betting platform rollouts in new states have been relatively seamless. Yet some obvious CX issues must be addressed before watchdogs and regulators step in.

Sports betting companies need to tackle four potential stumbling blocks:

  1. The product is still new to many customers. Gambling companies need to clear up confusion on the legal methods of sports betting and drive confidence that bets will be paid out.
  2. Most sports betting companies are pushing mobile apps for daily usage and interaction, leaving a strong need for tech support to help with logins and payment issues.
  3. Geolocation issues are a major factor. If users are near bordering states where sports betting is illegal, their phones might mistake them for being in the wrong location and their bets will not go through.
  4. Seasonality. Major sporting events such as the Super Bowl, March Madness, The Masters, FIFA World Cup, and the World Series amplify betting activity. As a result, gambling companies must have robust CX infrastructures in place to handle increased seasonal demand.

One of the biggest challenges is volume projection and staffing due to the sector’s rapid growth and lack of historical data, according to Chris Crowley, chief commercial officer for CX provider Alorica. A significant and continuous increase in users is coming from existing states, as well as new states legalizing sports betting apps.

“As the user base increases there is an increase in transactions across voice, chat, and email — especially from new users and novice users of sports betting apps. The ability to develop the appropriate staffing models and to train the staff effectively is crucial to delivering an exceptional customer experience,” he told CRM Buyer.

Betting on Digital-First Stability

Another big test for the sportsbooks, noted Crowley, will be finding the bandwidth to handle peak seasons when major sporting events drive a flurry of betting activity.

To withstand scrutiny from regulators and watchdogs, these companies require trained staff who can work with customers across voice, chat, text, and email.

“Like other digital-first companies that are born highly focused on product, sports betting companies may not yet fully appreciate the need for tech support and account management,” he cautioned.

For example, most sportsbooks rely on website FAQs to support their customers. Many of the new customers are gambling on sports for the very first time.

CX is critical to handle these concerns because money is involved. Customers rightly want access to a support person when they spend money to get something in return, such as a bet to win or deposit to get a bonus or free bet.

App Speed Risky Business

Logistically, the speed of the app interface makes betting easier. But it also increases the risk of mistakes, warned Crowley. That is why it is crucial to have knowledgeable and readily-available support offerings from live agents and automated channels.

Fierce competition to develop repeat customers makes CX crucial to this emerging market. Companies such as DraftKings, Caesars, BetMGM, and others are currently spending tremendous amounts of money to rapidly grow their user bases through aggressive marketing.

“To get the necessary return on this investment, they must develop user loyalty as it is so easy for users to jump to another app. One poor service experience can turn a novice bettor off forever,” said Crowley.

Another reason CX is important is sports betting has its own community and lingo. It can be unkind to newcomers who do not have a firm understanding of betting odds and how promotions work.

“A big issue surrounds where ‘free’ does not always mean free. Having a customer service team backed by a real CX strategy gives new users a lifeline to figure out the nuts and bolts of sports betting,” he explained.

Driving Factors

Social acceptance of sports betting is now common. State governments increasingly are becoming supportive of the industry.

Additionally, with the rise of second screens, sports fans have found new online communities that share their love of the game, Crowley noted. Fans today are often on Twitter and Reddit while watching their teams play, reading and reacting to what other people have to say about the game.

This further encourages fan engagement. Online sports betting has benefited from the influence of social media and, to an extent, cord-cutting, which has evolved the way we consume sports, Crowley observed.

“As sports betting gains wider social acceptance and state legalization continues, the industry will rapidly grow. For many, sports betting has become synonymous with watching and attending sports events,” he said.

In a short period of time, this will be an ingrained part of our social norms. The number of American adults betting on sports doubled in the last year alone. It is crucial that companies in this sector invest in a robust CX operation and explore strategic partnerships with vendors that can keep customer engagement impactful, secure, and scalable, urged Crowley.

Morphing World of Rules and Regs

The regulatory environment is rapidly changing in the mobile sports betting industry and online gambling.

Overall, online sports betting platforms are progressing with new functionality at breakneck speeds due to the fast changes in state regulations and requirements. Most of the major sportsbooks and online sites are still in the process of obtaining required licenses in recently-legalized states.

The Supreme Court decision in Murphy v. NCAA gave states the ability to pass their own sports betting legislation. Some 30 states — plus D.C. — have legalized sports betting with 22 legalized for mobile and online sports betting. Twelve states have active or pre-filed legislation on the ballot for 2022.

State laws vary greatly. Regulations range from betting in onsite casinos versus mobile/online to the age of bettors. Restrictions cover the types of bets, such as collegiate sports versus pro contests. Tax rates vary by state also.

Some states allow tribal and commercial casinos. Others like Oregon, New Hampshire, and Rhode Island only allow one or the other, or a state lottery commission runs the betting.

“Like any consumer-facing industry, there are also protections around personally identifiable information,” Crowley said. “As sports betting and mobile/online wagering become more common across different state jurisdictions, the landscape will only continue to evolve.”

On Deck, Real-Time Customer Service

Online sports betting requires unambiguous fairness and transparency. The entire customer journey should be shepherded by a customer support offering that can resolve issues in real time.

The typical response time so far is 24 to 48 hours later for some betting companies, according to Crowley. This process includes accessing relevant information, placing bets, and collecting the winnings.

“The industry would be wise to establish a new CX standard, one that will give confidence in the integrity of this emerging business model,” he recommended.

Plenty of disclosures, FAQs and robust “help” systems with omnichannel functionality will become the norm in the mobile and online sports betting experience, he concluded.

Jack M. Germain has been an ECT News Network reporter since 2003. His main areas of focus are enterprise IT, Linux and open-source technologies. He is an esteemed reviewer of Linux distros and other open-source software. In addition, Jack extensively covers business technology and privacy issues, as well as developments in e-commerce and consumer electronics. Email Jack.

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