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I posted yesterday on The new math of customer satisfaction, regarding the power of word of mouth (WOM), but had some further thoughts on a slightly different topic I wanted to continue with today.

To wit: Do all companies need to be equally concerned with customer opinions?  Is the WOM benefit/risk spread like peanut butter, or does it apply more to some firms than to others?

For example, back in Ye Olden Days when Ma Bell monopolized the telephone business, customers could be as ticked as they liked, but the one thing they could not do is go find another phone company. So perhaps the rules don’t apply to monopolies.

In thinking about this, I propose that there is a spectrum of WOM susceptibility, which looks something like this:

Monopoly - Dominant player - Avg player - Weak player - Start-up
(no effect)                            (normal effect)             (maximum effect)

Companies are most vulnerable to bad word of mouth (and will benefit most from good word of mouth) when they are young and just starting up. Why? Because most people are not familiar with the company, and thus haven’t formed an opinion. Once formed, opinions may be near impossible to change. So if the first thing a consumer hears about your company is that ’so-and-so says they are dirty rats’, you are likely forever branded as a rat in their mind.

For this reason, it makes sense to start-ups to pay absurd amounts of attention to customer opinions, and to proactively address every negative issue. On the internet, where you make first impressions daily, and where the user’s first impression will largely be guided by site design and user interface, it makes sense to keep these issues top-of-mind at all times.

I like this spectrum-of-effect idea. It kind of explains why some companies with loads of negative PR (Microsoft? Wal-Mart?) seem to sustain minimal damage, while other companies get the death sentence for one slip-up (Jet Blue, we’re keeping an eye on you!).

In the interest of practicing what I preach… any opinions on the ideas in this post?

I was reading the Sunday New York Times when I came across a letter from a reader referencing the old saw that ‘one dissatisfied customer can cost you 10 new customers’.

I don’t know if there’s been much independent verificaton of the factual veracity of that statement, but if you believe in the power of word of mouth and personal attributions, I think it’s fair enough to give it the benefit of the doubt. 

 It’s worth thinking about how the ‘1 costs you 10′ rule of thumb has changed in the internet age. Has technology changed the applicable ratio? It used to be that only those with a prominent pulpit (a television show, a newspaper column) could have an outsize impact. But today, with everyone potentially a publisher to the masses via blogs, discussion boards, or just through email distributions, just about anyone has the potential to deliver pain to companies which displease them.

Also, maybe this ‘1 costs you 10′ idea is far too crude. Perhaps all customers are not created equal, especially in terms of word-of-mouth potential. Perhaps the customer’s WOM value is directly tied to the size of his or her sphere of influence. A hermit living in a cave without internet might only offer a 1/1 ratio. Your average person might be 1/10. The typical high school kid with a blog and a large social network might be 1/50. Tick off someone with a popular blog, and 1 could cost you 100.

Companies might want to take this into consideration when deciding how much effort to apply to customer satisfaction. Perhaps a standard query before deciding whether to accept a return hassle-free: “Excuse me, but do you blog?”

2 weeks ago I was tragically stuck setting up for a trade show on a Sunday at the same time as my Philadelphia Eagles were playing the NY Giants in the playoff wildcard game. Tragedy! But I was savvy, and with my trusty laptop called up the NFL website and looked up their Field Pass program, which offers a ‘Risk-free 7-day free trial!’

You have to key in your credit card (red flag!), but then just have to cancel within 7 days to avoid a charge.

It turns out the whole Field Pass website is a web design disaster, and as far as I can tell, the game I wanted to hear wasn’t even available. I wound up running off to a sports bar to see the final quarter of the game.

Later than night, I tried to cancel my risk-free account… Search around their website for the cancel button, and eventually find this…

Question: How do I cancel my Fieldpass account?
Answer: To cancel your NFL Field Pass account, please call the NFL Field Pass team at 1-866-212-1346.

Oh, that’s just great. I called the number to learn… “Our business hours are 9-5 EST, please call back at that time.” Wow, this rocks!

The next day, I called, to discover that my call was important to them, but all reps were busy. Expected wait time… 12 minutes. You’ve got to be kidding me. 

At this point, I ask– where do so many companies get the idea that letting Joseph Heller create their cancellation process is the path to success and riches? It happens that this exact same topic is explored in the current issue of PC World magazine. Among other companies, they cover AOL’s notorious cancellation process. I’ve been through that once, and it’s about as much fun as running the gauntlet on a bed of hot coals.

I waited on hold for the Field Pass team to come available, and finally got someone on the line. It turns out the Field Pass team actually works out of India, via IP phone connected to the States via a 28.8 modem. That’s about the sound quality, anyways. At least they let me cancel.

There’s no excuse not to let someone unsubscribe from a service (especially a service where you’ve encouraged free, no-commitment trial) by clicking a button on the website. There’s only one reason for it– the company wants to make it as hard as possible, in the hopes you’ll… give up and just remain a member forever??? This sounds like the same logic behind many rebate programs, which I’ve blogged about previously (see Baited and Rebated).

Give me a break. What’s more likely is that you’ll swear never to do business with them again, and you’ll probably spread the word to a few friends.

Great plan guys. Anyone up for a free trial with AOL?