The Customer Service Hall of Shame

The Customer Service Hall of Shame

Four 'winners' from MSN Money's inaugural list are back -- 3 with
scores even worse than last year's. See the 10 companies Americans love to hate.

By Karen Aho
The economy's in the tank. Corporate profits are down. Business owners
are having just as hard a time getting loans as wannabe homeowners.

So you'd think that businesses would be treating their patrons like
royalty, right? That this would be exactly the right time for
businesses to coddle their customers?

Wrong. When the economic going gets tough, some companies apparently
get tough-minded about customer service, squeezing out the last dime of
profit by cutting back on critical customer-facing positions such as
phone personnel.

"We've seen a fall in customer service as we've gone into a recession,"
said Richard D. Hanks, the president of Mindshare Technologies, a
customer-service consulting company. "As the cost cutting occurs . . .
they start to cut the wrong things."

That reality is borne out in the results of MSN Money's second annual
Customer Service Hall of Shame, a ranking of companies with the worst
customer service, based on a nationwide survey commissioned by MSN
Money and conducted by Zogby International. The scores for our Hall of
Shame companies are, on average, down from a year ago.
And the 'winner' is . . . The company at the bottom of the
customer-service heap is Time Warner's AOL. A remarkable 47% of people
who had an opinion of AOL's customer service said it was "poor."
Analysts said that rating may have something to do with its effort to
transition from an Internet service provider -- where it still has more
than 9.3 million paying subscribers -- to an ad-supported Web portal.


"I don't know what to attribute that to," AOL spokeswoman Dori Salcido
said. "I just do know that we continue to improve customer service."
AOL fits squarely in the category of company that dominates our list:
communications companies and banks that provide complex and at times
highly technical products. Tens of millions of customers rely on those
products almost hourly. And, should something go wrong, those customers
get anxious and demand a fix -- now.

That's still no excuse, analysts say. In their zest for quarterly
profits, these companies tend to favor acquisitions over beefed-up
service staffs. They also lean toward confusing fees over
straightforward price increases -- strategies that don't play well for
the long haul.



"Most of these companies actually aren't thriving," said Michael Shames, the executive director of the Utility Consumers' Action Network,
a California nonprofit that monitors business practices. People don't
look at companies with poor customer-service scores and say, "Here's
where I should invest," he said.


For the survey, conducted online in March, Zogby asked more than 7,000
people across the country to rate their customer experiences with 140
leading companies in 14 industries, including airlines, hotels,
insurance companies and big-box stores such as Wal-Mart. Respondents
could answer "excellent," "good," "fair," "poor," "not familiar" or
"not sure."

The companies in the Hall of Shame were ranked by the percentage of people familiar with a company who answered "poor."

Although AOL didn't get ranked last year, corporate sibling Time Warner
Cable did, and it made the top 10 then and now, receiving a 29% and 31%
"poor" response, respectively. Time Warner Cable was one of four
companies -- along with Comcast, Sprint Nextel and Bank of America --
to make a repeat showing.

The Hall of Shame
1. AOL's response.

2. Comcast's response.

3. Sprint Nextel's response.

4. Abercrombie & Fitch's response.

5. Qwest's response.

6. Capital One's response.

7. Bank of America's response.

8. Time Warner Cable's response.

9. HSBC Finance's response.

10. Cox Communications' response.

Click here to see the full list of companies.


Size often a culprit

The companies' explanations Most of the companies chalked up the
continued "poor" ratings, in part, to their sheer size. Not only are
their products hugely popular, they said, but every year they field
millions of calls from customers, many of whom walk away perfectly
satisfied.

"I think we're the victim of our own success, in the sense that we're
growing so rapidly," Rick Germano, the senior vice president of
national customer operations for Comcast, said of the
telecommunications giant, which ranked second in the MSN Money-Zogby
survey. "People are choosing to get Internet and cable and telephone
with us, and that's where we're playing catch-up on the
customer-service front."

The exception was Sprint Nextel, which took full responsibility for its
well-publicized poor record of customer service in recent years.

The cellular phone company led poor-customer-service surveys, including the 2007 MSN Money-Zogby survey,
and late last year hired a CEO who vowed to make customer service a
priority in an effort to stop customer drain. The company posted a
$29.6 billion loss over the past 12 months.

"We've had higher-than-desired churn," spokeswoman Roni Singleton said.
"We've had to overcome the hurdles, and that's been a challenge for us."

Sprint Nextel was also the only returning company to improve its score,
albeit slightly. The other repeaters received greater percentages of
"poor" responses than in 2007. The overall average "poor" rating for
the top 10 increased from 27% in 2007 to 35% in 2008.
Hanks, the consultant, said that before the current economic woes took
their toll on customer-service opinions, those opinions had been
getting better in recent years.

When talk turns to recession, companies tend to cut where they think it
will hurt the least: in customer service. "Fears of a downturn start to
get into the psyches of senior managers in this country," Hanks said.
High-ranking companies Companies at the other end of the survey, with
few marks for poor service, also came as little surprise to experts. In
particular, Nordstrom, American Express and Marriott were cited as
three that routinely earn high marks.

Companies such as these try to weather the tough times by continuing to
invest in customer service, Hanks said. In the end, they earn lifelong,
loyal customers who tend to cost less and pay more.

By contrast, companies that turn off the charm in search of immediate profits risk long-term success, Hanks said.

It's common for companies criticized for bad customer service to defend
themselves by pointing to their legions of satisfied customers or by
citing averages, Hanks said. But ignoring the unsatisfied customers
catches up with them eventually.


And as research has shown, satisfied customers equate to happy shareholders.
Conversely, unhappy customers may lead to unhappy shareholders. Just
ask Time Warner (the parent company), Comcast and Sprint: Their stocks
are down 26%, 18% and 55%, respectively, over the past year, compared
with an 8% drop for the S&P 500 Index.

1. AOL's response.

2. Comcast's response.

3. Sprint Nextel's response.

4. Abercrombie & Fitch's response.

5. Qwest's response.

6. Capital One's response.

7. Bank of America's response.

8. Time Warner Cable's response.

9. HSBC Finance's response.

10. Cox Communications' response.

Hey-where you get this from

Sprint is the absolute worst and should have been No.1 On the list!

Here is the real reason..This is India . It's where you call when you have a technical problem.

Mrs.JAY wrote:

Hey-where you get this from

MSN....Money central article

Mrs.JAY wrote:

Sprint is the absolute worst and should have been No.1 On the list!

I never had to deal with them before...but I do have friends that do or did. I remember their service was sooo bad a girlfriend of mine had to be still in a certain spot of the apt to talk on her phone...one had to leave her house and go up the street to get a signal.