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When consumers have the opportunity to exit

September 17, 2004

The demise of AT&T Wireless, one of the biggest brands in the country, started when customers were given the opportunity to leave. Number portability, which had been challenged by the wireless industry for so long, allows consumers to vote with their feet, and AT&T customers left the company in droves.

The case proves that consumers will only put up with sub-standard service for so long and if they have an opportunity to take their business elsewhere, they will. In the 1970s and early 1980s, ‘the customer is king’ was the mantra of American business. But in recent years it has been widely recognized that standards have slipped, as evidenced in the declining ratings for customer satisfaction in the ACSI run by the the University of Michigan.

However, there might be a change happening. Those companies that are having trouble achieving growth are understanding that keeping customers is essential for profitability and many of these companies are developing measures to keep their customers happy. One such trend is the application of “Self-Service” technologies like the Internet and touch-tone phone services which allow consumers greater control in getting information and conducting transactions.

In a recent article, The Economist argues that companies are tempted by these technologies primarily because they lower costs. The article warns that bad design of these services can simply exacerbate the problem and lead to greater customer frustration. It’s inevitable that more brands will start to use these services, but to achieve success, it’s imperative that they are recognized as touch points of the brand experience and are not only planned, but also measured for their contribution to the brand.

ACSI
Seattle PI Article
Economist Article

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