Friday, June 17, 2011

Final lessons on how not to treat your customers from Virgin Mobile: Part 2 - How to prevent this happening in your organisation

This is a follow up to yesterday's post describing my experiences as a former customer for Virgin Mobile.

Virgin Mobile is owned by Optus who license the use of the Virgin name. In one way Optus's behaviour is not a bad move, they're using Virgin's brand to screw consumer's for every dollar they can. If customers revolt against the brand, they can just cease licensing it and find a new one to license. Virgin clearly don't police how their brand is used and I no longer place the extra trust I used to in products sold under the Virgin brand, they could be good like the airline Virgin Australia, they could be total rubbish like Virgin Mobile. In fact my initial reaction to Virgin branded products is now probably slightly negative as I'm reminded of my frustrating Virgin Mobile experiences.

These practices must negatively affect Optus in other ways though. I couldn't be happy working at a company who treats their customers in this way, and many times during my experiences I felt sorry for the Virgin Mobile staff I was dealing with who would personally empathise with my plight, but weren't empowered to do anything about it. That must make for a terrible work environment and staff retention rates.

I'm fascinated by what must be happening internally at Optus for them to act in this way. I've never worked there or spoken in detail to anyone who works there, but here's my guess (and if anyone works or has worked there, I'd love if you could shed some light.):

1. Staff at the customer facing level aren't empowered to do anything, so despite the fact they can see these issues they can't do anything about it. This is compounded by the fact that most customer facing staff are working in overseas call centre where they're probably happy to have a job and don't want to rock the boat and risk their employment by passing this feedback up the line. Culturally they might not be used to questioning their superiors in the way we are in the West, and Optus are unlikely to be doing anything to encourage an open internal culture across their call centres.

2. Upper management spend no time with customers. A closed internal culture, compounded by customer facing activities happening in overseas call centres means they have no idea the impact their decisions have at the customer level. Driven by their board, they set aggressive targets for their business to achieve.

3. Middle management, as their name suggests, are stuck in the middle. They can see some of the impact their decisions have on customers, but they also need to meet the aggressive targets set by upper management. Internally lip service is given to treating customers well, but the reality is this is put well and truly last behind meeting targets. So middle management make what is a reasonably logical choice in these circumstances, they set up processes that work in the short term but are unethical and damaging to the business in the long term.

This is one of the many cultural challenges that happens in a large organisation, particularly one that operates in an industry with few competitors so they can at least partially get away with treating customers poorly because customers have few other options. This is one of the things that impressed me most about working with Google. Motto's like 'don't be evil' really were put into practice and the internal culture was to operate with a view to the long term rather than short term gain. A great example of this is separating sponsored links from organic search results and having them clearly labelled as such for the consumer. Compare this with some magazines we've been dealing with who actively make it clear that to get editorial coverage, you need to be running paid advertisements. I still don't understand why governments in some countries have questioned Google about sponsored links being confused with organic search results when their time would be much better spent following up with other media companies.

Our approach at Shoes of Prey

We aim to be at the extreme other end of the spectrum in how we treat our customers at Shoes of Prey, in line with Zappos rather than Optus. I hope we can provide our customers with many of the top 10 positive customer experiences they've ever received from a company, and right now I think we do a great job of this but we'll need to ensure we don't lose our way as we grow. There are two simple ways we can do this:

1. Involve all key staff in customer service. Everyone on our team including Mike, Jodie and I will always spend time answering customer emails and speaking with customers directly so we can understand the Shoes of Prey experience as they see it. We're already doing this, Ken who we recently hired to manage our operations in China just spent 2 weeks with us in Sydney where most of his time was spent on customer service training and emailing directly with customers. Jodie and I take care of customer service on public holidays and will often help Susie and Jonaye when they're busy.

2. Ensure the culture of our organisation is focused around the customer. Point 1 above goes a long way to achieving this, but we need to ensure that customers come first and targets come second. Customer service should and I think is viewed as a key role within our company. In the future, if we're to set targets around metrics like lowering refund rates, we need to ensure that doesn't mean we reach the target by screwing the customer. We'll need to ensure we're measuring customer happiness and not allowing that to drop, while we focus on improving the customer experience so they're happy and not requesting a refund.

I'd love to hear your thoughts. Any other insights into why Optus/Virgin Mobile treat their customers so poorly? Does your organisation take a Zappos or Optus approach to dealing with customers?

Update: A creative and hilarious complaint letter re: Virgin Atlantic. via @inspiredworlds

Update 2: About 6 hours after this post going live I received a call from a very apologetic customer service manager from Virgin Mobile. She explained that they're across a number of these customer issues and know they need to improve as these sorts of experiences are not what their company is about. She's personally responsible for a project to fix these issues. It was nice to receive the call and I wished her all the best!


  1. Guess it depends if you feel Greed is still good...

    I think the Owner / Founder playing a role in the company plays a big part of what you're talking about (also what kind of person they are). While most people think of Google as a big multi-national (which of course they are)... I still think of the geeks in their garage who started it.

    Jobs is as big a part of Apple as the products are.

    I think it gets back to whose driving the company direction, how empowered they are to influence culture. Isn't Telstra going through a "customer service" upheaval at the moment... yet I recently heard a first hand account of a store employee being "throttled" by a frustrated business customer.

    I'm not clued up on the complete Zappos story but having someone like Tony Hsieh on board from the very beginning would make it easier to foster a culture where customer satisfaction is paramount.

    My personal experiences with Optus have been relatively good, but I don't have high expectations either when dealing with these companies. Personally I find the banks worse.

  2. Fully understand your gripes with Virgin/Optus. I reckon if you wrote a customer complaint letter that mirrored this one, you'd get coverage like you wouldn't believe...(although you may not want to do it from a Shoes of Prey branding perspective)