Friday May 16 2008
All times are London time

Search Quotes in the FT.com site
FT Logo

March 27th, 2008

Three customer service snippets

Bill Price, the former vice-president of global customer services at Amazon, has co-authored a book that sounds like it could be useful, judging from the review in today’s FT. The argument of The Best Service Is No Service is that customers mainly call when something goes wrong or to find out basic ”where can I get?” or ”how do I?” information. It suggests that resources can be freed up for the handling of profitable sales enquiries if operational errors are avoided and the flow of information improved. You can read the first 28 pages here.

It was also interesting to hear Luke Johnson declare earlier this week that he used to read all complaint letters in the days when he chaired PizzaExpress, the British restaurant chain; he says employing people who enjoy their work is crucial to ensuring good service, more so than providing them with the best training. (The introduction of thinner, crispier bases at PizzaExpress has ensured that there will be no complaint letters to the current boss from me).

Finally, the airline sector in Japan looks to be a customer service case study in the making. This analysis piece in today’s FT details the friction between the low-cost airline model and the lavish customer service that is normal in Japan.

February 15th, 2008

In defence of the low rollers

Banks, airlines and other big companies often use software to find out, among other things, which of their customers contribute little to their bottom line. Those marked down as low rollers might have to wait longer to have their call answered, or miss out on special offers. Some companies might even be tempted to sever ties with their least remunerative clients, reasoning that they can never be made profitable.

But firing your worst customers might not be a good idea, according to research by Upender Subramanian, Jagmohan Raju and Z. John Zhang of the Wharton business school at the University of Pennsylvania.

For one thing, the customer relationship management (CRM) software might not be very accurate in the way it segments people, creating a risk that the company might fire some profitable clients by accident. Secondly, the authors claim that jettisoning the less valuable customers would also send a signal to competitors that the remaining clients were of high quality. The competitors might then poach these high rollers.

I find the first threat to be more plausible than the second. Having just moved back from Paris to London – with all the address changes and other administrative hassles that entails - I have been struck by how bad many companies are at maintaining and updating basic personal details (a certain UK bank shall remain nameless). My faith in their ability to keep a running tally of my profitability to them is limited. But it is useful to be reminded that customer service decisions do not happen in a competitive vacuum.


More FT Blogs and Forums

  • Economists' Forum Leading economists and the FT's chief economics commentator, Martin Wolf, debate the big issues

  • Clive Crook's blog The FT's chief Washington commentator blogs about intersection of politics and economics

  • Gideon Rachman's blog The FT's chief foreign affairs commentator on world issues and his travels

  • The Undercover Economist Tim Harford's blog on economics in everyday life

  • Willem Buiter's Maverecon The LSE professor blogs on 'economics, politics, ethics, religion, culture, free and open source software (FOSS), and whatever'

  • John Gapper's blog FT chief business commentator talks about business, finance, media and technology

  • Dear Lucy Columnist Lucy Kellaway and readers solve your workplace woes

  • FT Alphaville Instant market news and commentary for finance professionals

  • Brussels Blog By our Brussels writers

  • Westminster Blog By our UK Parliament writers

  • FT Tech Blog Our San Francisco and world correspondents look at the intersection of technology and business