The recent debacles experienced by Netflix, Bank of America, and Verizon all make it apparent that the old adage ”buyer beware” is beginning to give way to “seller take care.” Each of these companies very publicly reversed course in 2011 after announcing decisions that displeased their customers.
Technology-fueled people power, years in the making, has come of age.
Netflix’s July decision to dramatically raise prices and its September announcement of a (short-lived) plan to split its DVD and streaming packages into separate services were both unmitigated disasters for the company, resulting in a 75% decline in its stock price and a loss of over 800,000 subscribers. Although “the social media cries were nearly deafening,” it doesn’t seem that there was any organized effort to punish Netflix for its less-than-stellar efforts to “improve” its customers’ experience.
The same cannot be said, however, for Bank of America and Verizon. Take for example, this email message from Molly Katchpole at Change.org:
Molly again, with huge news:
Verizon just announced that it’s not going to charge customers a fee to pay our bills online.
Two nights ago, I started a petition on Change.org telling Verizon that it can’t nickel and dime customers like me with new fees. Within hours, more than 130,000 of us signed the petition. (Thanks, by the way — you’re amazing!)
It took months of hard work to get Bank of America to drop its $5 debit card fee, but Verizon backed down in less than 24 hours. Turns out people like you and me are getting more powerful by the day.
Congrats, and happy New Year!
P.S. The Change.org team asked me to remind you that it’s super easy to change something in your community. You can start your own petition in about 2 minutes – just click here. (Seriously, you should do it. Do it!)
As I was saying, seller take care.
Recent media coverage of the financial woes of companies like Bank of America and Goldman Sachs (see, for example, coverage from the Wall Street Journal and New York Times) often misses an important point – almost certainly part of their current troubles can be traced to their “less than worthy” behavior in the past.
- Bank of America’s undistinguished record as an employer, seller and steward – we assigned it a “C” on the Good Company Index® – has done little to earn the loyalty of its customers.
- Goldman Sachs well-documented (and penalized) money-making-schemes – that put its own interests ahead of its client – is also not a formula for earning customer support in tough times.
These firms’ focus on being big and dominant – some might call it “greed” – has caused them to lose focus on their fundamental reason for being, which is to create value for customers and society.
They are now paying the price for losing sight of that.