Customer Disservice Is the World’s Hot New Business Model
In May, a senior executive at the IATA (that’s the international airline association) told me that the British government had reneged on commitments made to airlines to provide a sufficient number of customs agents to avoid hour-long or longer waits at Heathrow. Not long after, as the summer heated up, the airport’s infernal passport queues were described as being “at a crisis point,” which may explain why Heathrow regularly receives miserable passenger reviews.
But behind every customer service crisis there apparently lurks an opportunity to make money. My IATA colleague had forewarned me that the British government was going to use the crisis at passport control as an opportunity to collect revenue from inconvenienced passengers hoping to avoid the (government-induced) inconvenience.
And it was so.
Not long after my wife and I suffered through long lines even at fast track entrances, we each received an e-mail inviting us to apply for the British governments’ special registered traveler service. For the tidy sum of 70 British pounds (about $93), that program gives you a one-year pass to use machines to jump the customs line if your passport has a chip in it, and the privilege of using the U.K./EU lines and not filling out a landing card if machines aren’t available or your passport is not chip-equipped. After that first year, you can renew by paying 50 pounds more for another 12 months.
Then there are the airlines themselves. Having made the coach travel experience as unpleasant as possible, they now use the flight booking process to bombard you with offers for all the accoutrements—for a fee, of course—that might bring flying back to what it used to be before airlines charged for checking bags and food and put you in seats sized for eight-year-olds. So they sell seat locations with slightly more knee room, and airline-branded credit cards that permit you to check your first bag for “free”—that is, if the cards (which typically charge $95 after the introductory year) can be considered “free.” And, yes, if one of your extra fees brings with it priority boarding, you might find a place for your carry-on bag somewhere near you.
As was nicely detailed in a lament on ever-worsening tech support published in the New York Times earlier this summer— appropriately titled “Why Tech Support Is (Purposely) Unbearable”—92% of customer service managers surveyed knew that their agents could be more effective and 74% could detail precisely how the company prevented the tech support people from providing decent tech support.
There’s a financial reason for this bad customer support too, of course. Customers’ frustrations offer yet another opportunity for companies to make money. While callers wait endlessly on hold, listening to music and the ridiculous mantra of “Your call is very important to us” (which it surely is not, or someone would have answered the call), companies push other products and services—including, of course, the opportunity to purchase “premium” tech support and get out of the endless wait on the phone.
I suppose I can’t object to apps such as FastCustomer, LucyPhone, Hold-Free, and Holdr, companies that are in the business of letting you bypass endless phone wait times by waiting for you and calling you when a human being is actually ready to talk. Or to services like Flight-delayed.co.uk, which, for 25% of funds recovered, fights on your behalf with airlines to recover compensation for flight delays that exceed the regulated maximums (Oh, Europe, where travelers receive actual compensation for flight delays; That policy in the U.S. would put United out of business). These are companies filling a real need created by service providers that don’t provide service.
But when the service providers not providing the service then expect you to pay more to get the service they are not providing, that strikes me as fundamentally unfair. At the end of the day, it’s a question of competition—or lack thereof. As Kate Murphy noted in the New York Times piece, a business model that rewards its own incompetence by charging users to escape the service malfeasance is only possible in sectors where competition has been so eviscerated that people have almost no choice.
Jeffrey Pfeffer is the Thomas D. Dee II Professor of Organizational Behavior at the Graduate School of Business, Stanford University and the author of Leadership BS: Fixing Workplaces and Careers One Truth at a Time.