The Customer Service Survey

Does $50M in Marketing Overcome Bad Customer Service?

by Peter Leppik on Tue, 2013-01-22 17:32

Ira Kalb reports today in BusinessInsider (via Consumerist) that Time Warner Cable is spending $50 million on a marketing campaign to try to win back customers who have left the company over the past few years. Kalb thinks a big part of the reason why Time Warner was losing customers in the first place is because the company has garnered such a terrible reputation for bad customer service.

I don't know if this is true or not, but it certainly seems plausible to me. At Vocalabs we pulled the plug on Comcast for Internet service last year, and customer service was a big part of the reason. We're actually spending a couple bucks more each month to work with a different ISP, a local company lacking Comcast's poor reputation.

I've often said that the most cost-effective marketing dollar is usually spent on improving customer service, but it rarely gets demonstrated in such stark terms. $50M is a lot of money to spend winning back customers (if it even works), but Time Warner has been losing a lot of customers. Perhaps if they had spent some of that money a few years ago to improve their service, the story would be different today. 

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