Consider this for a moment – if you had an opportunity to punish shoppers for leaving your business after they had a bad experience or were tempted to do business with another retailer, would you? For most of us, the answer is simple. We wouldn’t do it. It just does not make sense. If you are unhappy with a good or service, you should have every right to go elsewhere.
Verizon (and the rest of the mobile phone industry) seem to think otherwise. In fact, Verizon just raised their fees to a whopping $300 for customers who wish to terminate their contracts early and move to another carrier. Their argument is simple – we have invested in customers by supplementing the cost of their phones. Great point; however, it just doesn’t pan out. In any other industry, that’s just the cost of doing business.
For instance, look at Zappo’s return policy. They offer free returns for up to 365 days. That’s one year free of charge, no questions asked.
Apparently, the cell phone business is different. But the fault is all theirs. They made the conscious choice to offer prospective customers great deals on phones in order to attract them. It is a pricing strategy gone awry and not they want to shift the costs to unhappy customers. Let me throw out a novel idea.
Instead of punishing customers for leaving when they are unhappy, why not charge a little more for your service and don’t give them the chance to leave by offering the absolute best, most innovative cell phones accompanied by the absolute best service in the world (cell coverage as well as customer service).
The formula is pretty simple. If you want to increase loyalty, you must connect emotionally with your prospective customers while offering them a service and/or product that is a great value. Zappos gets it; cell phone carriers don’t.