Subject: [NEXTEL-1] Nextel blows more customer moments of truth...again

From: "marcel_rf1" <[email-masked]>
Date: Thu, 10 Jul 2003 02:55:17 -0000

Tech Update
REALITY CHECK
Nextel blows more customer moments of truth...again
By David Berlind
July 2, 2003

Little more than a year has passed since I last ripped Nextel for 
letting customer moments of truth go awry. My latest experience with 
the wireless carrier makes me wonder whether Nextel took that earlier 
column seriously.

A year ago, my family and I considered Nextel's walkie-talkie-like 
push-to-talk (PTT) a must-have feature. Many people I know rely on
PTT 
for staying in touch with family or for business reasons. For years, 
Nextel has had the PTT market pretty much to itself.  But, by the
time 
2003 is over, the PTT feature will no longer be a unique 
differentiator for the carrier.

Verizon Wireless and SprintPCS have each announced that they'll be 
introducing PTT this year. And this week, PTT turned from feature
into 
controversy when Verizon Wireless sued Nextel for improperly
obtaining 
prototypes of Verizon's PTT-based handsets.

If the allegations are true, Nextel is apparently worried about the 
PTT market becoming commoditized and subsequently losing customers to 
the competition.

But nothing makes a company's customers want to try out the 
competition as much as poor customer service. Here's what happened:
Two of the four telephones in my family's possession experienced the 
same failure after their warranty periods had ended.
(Both phones suddenly stopped accepting a charge, even when supplied 
with new batteries.)

I called Nextel's customer service to find out what I should do next. 
 This was the first customer moment of truth. I expected to receive 
the sort of information that would help me get the phones repaired as 
quickly, conveniently, and inexpensively as possible.

The representative on the phone asked what my zip code was. He 
instructed me to take the malfunctioning phones to a location that
was 
virtually around the corner.

The second moment of truth occurred when I learned, upon my arrival
at 
the specified location, that it wasn't a service center. It was only 
an authorized Nextel retail outlet.

I had two expectations for this second customer moment of the truth.  
First, I expected that any person at an authorized retail outlet for 
anything I buy would have complete and accurate information about
what 
to do when something purchased there breaks. Second, I expected that 
the retail outlet would be able to send it to a service center for me.
Neither expectation was fulfilled. My only option, I was told, was to 
drive to one of two service centers, each of which was about 40 miles 
away.

I called Nextel back from the showroom floor of the retail 
outlet--this would be the third customer moment of truth. The Nextel 
representative identified a service center that was a bit closer 
(about 15 miles away) but failed to offer any other options. At this 
point, I was wishing that fixing a telephone was more like fixing a 
laptop from one of the respectable manufacturers. If you call IBM,
for 
example, someone shows up at your door within 24 hours with a box.  
You stick the computer in the box and, for most repairs, the computer 
is returned to you within two or three days.

Then I remembered driving by a radio service center with Nextel logos 
on the side of its building--and it was a lot closer than 15 miles. I 
stopped in and, sure enough, the owner said he could fix the phones.  
Naturally, with the Nextel signs and collateral materials lying 
around, I assumed that it was an authorized service center. It
wasn't, 
but I didn't know this until later.

The assessment fee per phone was $20, refundable only if I chose to 
repair the phones.  I left the phones behind for assessment. Later 
that day, I received a call telling me that one unit could be fixed 
for $70 and the other phone wasn't fixable at all. Seventy dollars to 
fix a cell phone?

Another customer moment of truth was upon me. Staring at a $70 repair 
bill (and already out $40 for the assessment fees), my family and I 
wondered if it wouldn't be cheaper just to buy some new phones. This 
is when we learned that Nextel treats new customers better than old 
customers. This is a mistake, in my estimation, especially in the
face 
of stiffening competition and diminishing competitive advantage (the 
PTT feature).

The most important asset to any carrier is its existing billing 
relationships. In the case of Nextel, new customers (referred to by 
carriers as "new activations") get special discounts on phones.  
However, those discounts are unavailable to existing customers. New 
phones comparable to the ones that broke would cost more than $70 
each.

Savvy cell phone buyers understand that those discounts are designed 
to lure new customers into a billing relationship. I can understand 
why the discount might not be available to someone who's looking to 
upgrade their phone to a newer model. But, my expectation is that a 
carrier like Nextel would want to give the existing customer with 
broken phone (or phones) a break. At the very least, we should have 
had access to prices that were the same as those to which new 
activations had access. But we didn't.

After that failed customer moment of truth, my family and I engaged
in 
what I'm assuming is a carrier's worst nightmare. We started
reviewing 
offerings from the competition.

Not only were SprintPCS and Verizon Wireless going to have the PTT 
feature, but both were offering phones for under $70 that were
sleeker 
and more stylish than those available from Nextel. In short, it would 
be cheaper for us to start new accounts with a competitor than it 
would be to fix or replace our phones and keep our existing accounts. 
 At this customer moment of truth, Nextel was literally pushing us
out 
the door.

Just before pulling the trigger to switch, I decided, to call Nextel 
public relations-- in my reporter role rather than my customer 
role--and tell them I would be writing a story about this escapade.  
Nextel spokesperson Kelly Mullins agreed that the treatment I had 
received as a customer didn't make sense. She put me in touch with
the 
company's national service and repair program senior director Michael 
Volante.

Volante contacted me and said, "We ran you over in the process and we 
want to make good on that." I explained that I didn't want 
preferential treatment simply because I was a member of the press and 
that if he was going to make good on it for me, the same option would 
have to be available to other Nextel customers in the same situation. 
 As it turns out, on the first call I placed to Nextel, I should have 
been informed that, for $2.50 per month, I could join a maintenance 
program (even though my phones were already broken) that allows me to 
walk into any Nextel service center and get the phones fixed or 
replaced at no charge. As an alternative, one can call Nextel's Care 
Center, which transfers the call to Motorola's service center, which 
in turn sends a shipping box to you; the complete turnaround time on
a 
repaired or replaced phone is 72 to 96 hours, with all shipping costs 
included. In fact, said Volante, I should have been informed of these 
options at every customer moment of truth--the phone calls and the 
visits to two authorized dealers. But I wasn't.

"During your original call to care center," said Volante, "You should 
have had all of the options, including just joining the maintenance 
plan for $2.50 per month, explained to you.

Most of the time, it works. But we are aware that we have an issue 
with the tools that our care representatives have access to, and
we're 
working on it. We expect those problems to be resolved in the coming 
months. You should have escalated your first call."

I asked Volante how I would have known that the call should have been 
escalated.  Volante explained that some customers are aware of all
the 
options because of mailings that go out to them. That's a good reason 
to read those mailings, which I typically overlook. 

 (Who has time to read that stuff?)
Nextel is now refunding the $90 ($70 for the repair, $20 for the 
assessment of the unrepairable phone) and is putting the phones on
the 
$2.50 per month maintenance plan.

Despite the happy ending, my experience highlighted too many blown 
opportunities.  Nextel came dangerously close to losing three 
accounts. When coupled with my previous Nextel experience, it's 
amazing that I'm still a customer. For businesses, this case study 
should serve as a reminder of how important it is to list--and then 
test--all of your customer moments of truth. At the very least, if 
you're in charge of a customer-facing division or a department, you 
should be testing all of your department's moments of truth. Ideally, 
there should be someone with authority whose job it is to inventory 
and test all moments of truth across the entire company, and then to 
fix the system where it's broken. Perhaps it's time for a CCSO--a 
chief customer service officer.

Having one person whose responsibility cuts across the entire 
organization allows for the opportunity to standardize company-wide
on 
documents, values, processes, and CRM systems. To the extent that
your 
CRM systems can offer the same user experience to customers that your 
customer service representatives get (via the Web or phone-based 
interactive voice response), the opportunity to let customer
self-help 
options lower your total cost of customer care exists as well.  
ASP-based CRM provider RightNow Technologies fits squarely in this 
niche and its multi-tenancy framework helps to keep its customers' 
total cost of CRM ownership down.

Have you inventoried, tested, and fixed your customer moments of 
truth? Perhaps now is a good time. Believe it or not, customer
service 
is  a differentiator. In fact, it could be the one that makes or 
breaks your business.

http://techupdate.zdnet.com/techupdate/stories/main/0,14179,2914188,00
.html

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