Are companies getting meaner?
Filed under: Recession
While I don't have any scientific proof (just a growing pile of anecdotal evidence), it does appear as though an increasing number of companies are taking classes at the Ebenezer Scrooge school of business and becoming more cheap when it comes to dealing with customers. And in this day and age of thinning wallets, cheap often translates into simply being mean. As my WalletPop colleague Vera Gibbons correctly observes, "The days of 'the customer is always right' are long gone."
I recognize, of course, that many companies have had to cut back in order to stay in business. And they may feel they have much less flexibility than they did in the past when dealing with, say, their financially-strapped customers. But some industries and businesses out there are becoming downright stingy. What do I mean, exactly? Here are a few examples:
Utility companies. Not that I'm proud to admit this, but I was recently behind on my electric bill, enough so that last month, I needed to pay it on the due date or risk being disconnected. As a freelance writer in a dodgy economy, it's a situation I've become used to. Last month, I called my utility company, Duke Energy, to inform it that a magazine I occasionally write for was finally sending me a paycheck on the very day my electricity was scheduled to be disconnected.
I asked if it would mind moving my disconnect time from 8 a.m. on Sept. 20, the earliest point I could be disconnected, to later that afternoon or even the following day to ensure I'd have enough time to get my check, cash it and pay the bill.
Nope, I was told. I asked to speak to the supervisor and once again was told that they couldn't budge. The supervisor conceded that my request wasn't ridiculous and that in the past, they would have given me some wiggle room, but that the policy had recently changed.
As it turned out, my power was still on when my mail -- with the promised check -- was delivered on the afternoon of Sept. 20. I immediately paid my electric bill, and all was well. Still, my experience left me with an unpleasant sense that some companies, just when customers most need flexibility and a little kindness, are taking a tougher stance. And while I'm empathetic to Duke Energy to a point -- power companies have bills to pay, too -- I doubt they're ever worried that their power will be turned off.
Airlines. It's no secret that most airlines are charging travelers for having the temerity to bring baggage with them on their flights. Last year, in fact, airlines raked in $2.7 billion in baggage fees. (Kudos to Southwest Airlines for being one of the few airlines that proudly boasts no baggage fees.)
But the U.S. Department of Transportation recently proposed that airlines return those baggage fees when they lose a customer's suitcase, which seems, well, perfectly reasonable. But the Air Transport Association, a trade group that represents the nation's biggest carriers, vehemently disagreed with that idea. It wants airlines to be able to decide for themselves if they should refund the baggage fee. While it's understandable that they don't want government interference, ultimately, to lose a customer's bag -- even if they find it several hours later -- and not refund the baggage fee...well, it seems downright petty.
Cell phones. Maybe because we're all accustomed to cell phone carriers slamming us with $35 activation fees, $2 to $4 directory assistance charges and locking us into year-long or longer contracts, this category is hardly worth bringing up. But one of the newer sneaky fees on cell phone statements is a regulatory fee, a charge that can range from cents to several dollars that carriers pass on to their customers to help defray the cost incurred when they collect government-mandated taxes and fees related to their service.
In other words, cell phone companies have apparently never heard of the "cost of doing business" concept and are simply passing on this cost to their customers.
Buses. No offense to the good folks at Greyhound, the national bus service, but I think we can all agree that if you're traveling Greyhound, you aren't rich and probably can't afford any extra, "surprise" fees. But as the Los Angeles Times recently reported, if you buy a family member or friend a ticket for a Greyhound bus, you'll be charged an $18 gift ticket fee. Greyhound's spokesperson told the Times that it was an anti-fraud measure and a handling charge since the person being given the ticket has to pick it up at a Greyhound bus depot. But if it's anti-fraud, pointed out the Times, why only charge the someone giving the ticket as a gift and not everyone? (Not that we want to give Greyhound any ideas ... ) Sorry, but this policy is just mean.
Newspapers. I"m kind of sympathetic to the Los Angeles Times and hate to slam it after it did us a favor by sharing the news about Greyhound, but one of our WalletPop editors and writers, Ann Brenoff, who is based out of Los Angeles, pointed out to me that "the TV listings used to be included for free. Then they discontinued them, saying, 'No one really wanted them, they're too expensive to print, you can read them free online.' And now, this week, they reinstated it and said we'd be charged."
And that charge would be $2.99 a month, according to New York Magazine, which quoted a Times vice-president as saying, "Our [elderly] readers tell us they want a weekly TV book that covers around-the-clock programming."
Ah, great. Sticking a fee to elderly readers, many who are likely to be on a fixed income, for TV listings that used to be free? As I said, I'm sympathetic to the newspaper industry, given that they've been hammered by shrinking readership and other forces, but that does seem to fit the definition of mean.
What all these companies may be forgetting, however, is what goes around comes around. In other words, karma could end up hurting at least some of these Scrooge-like businesses.
As Matt Wallaert, a behavioral consumer psychologist at Churnless.com, a consulting company that helps businesses brainstorm, design and build web-based solutions, says: "Companies that are doing things like disconnecting without grace periods and pushing to close difficult accounts to eliminate immediate financial risk -- it's good for their bottom line, but terrible for consumers and for the nation."
"Actions like these will be remembered," warns Wallaert. "We won't be in this economy forever."
Geoff Williams is a frequent contributor to WalletPop. He is also the co-author of the book Living Well with Bad Credit.
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Reader Comments (Page 1 of 1)
10-04-2010 @ 6:03PM
cuscoart04 said...
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Through Christ Our Lord.cusco art
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10-05-2010 @ 2:11PM
Bob said...
After 17 years working for the same mean company I lost my job when they outsourced it. It was the first time in my life that I was unemployed. We have 3 young children and I can't even begin to describe the feeling I had knowing that I had no income and couldn't find a job. A friend of mine told me that he was doing well working full time on an internet based home business. He told me that there were hundreds of thousands of people making a full time living that way. That was all well and good but I didn't much money to invest and I knew I didn't have the skills that would be needed. He sent me this link to this web site ( HttP://cl.lk/onlinebizsuccess ) and told me to check out this system. It wasn't a pyramid scheme or a get rich quick scam. It turned out to be a life changer for me because with virtually no investment I got in the game. Now I'm making much more money than I ever have and, believe it or not, I'm now working less time everyday than I used to spend commuting back and forth to my old job.
10-05-2010 @ 5:21PM
sanbaodian2 said...
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10-04-2010 @ 6:03PM
Bob said...
Corporate Exec to Customer: I don't care about your financial troubles. By being Scrooge I will enhance my company's quarterly bottom line during these times of crisis. That will get me $Millions in bonuses to buy homes and yachts at depressed prices. At the first hint of a customer revolt should we pull out of this stalled economy, I will move on to my next gig. That will come with an immense signing bonus and a nice big golden parachute. Your demise is my success, the more the better! Now have a nice day and thank you for your continued business.
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10-05-2010 @ 10:12AM
Cara said...
How about cable companies COMCAST offers 99.99 for the bundle for new customers but if you are a loyal customer you can't get that rate... their reasoning its so you try our services and see how good we are, wouldn't budge even when i pointed out that in the year I have had them I had to have a tech come to my house 8 TIMES not to mention that my cable has issues nearly everyday... what service I ask you?
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10-05-2010 @ 3:39PM
Dick said...
Did they also tell you you'd be getting 'high' speed internet that's 7 times faster than AT&T, only to find out you really got 'economy' internet access instead? If you call in one day late to cancel your free premium channels, you'll be charged for a month, but if you call them two weeks early and tell them you don't wish to continue getting them after the 90 'free' days, you'll find them discontinued before you hang up the phone, not at the end of 90 days. Also, with the $99 special, ($120 after taxes and fees), you get equipment that's been around since Jesus rode a tricycle. My cable box has 3 ownership labels on it. ( Comcast, AT&T and Adelphia ) It took 4 boxes over a 5 day period to actually begin getting programming. The billing date started at the original installation day, not the day I actually started recieving the programming. And that $20 credit for not showing up for an appointment...what a crock! They claimed that the "installation" partner was responsible and the partner says that they don't give that guarantee as they are not Comcast. Can't wait until my 12 months are up.
By the way, a note to tv advertisers...regardless of how big you are...Comcast will 'step' on your last 4 or 5 seconds of air time to insert their local commercials. Any channel, all day long. Check it out for yourself, in any Comcast market.
10-05-2010 @ 3:30PM
cqdeed said...
Why do I get the feeling the first example is the one that he was really concerned about. Duke Power was not as nice to him as he thought they should be so he wanted to bad-mouth them in an article and put it on the internet. He found three more examples and Wa-La...an article that lets him say bad things about a company that did not want to give him a free ride. As for the cell phone regulatory fee; ALL companies pass on the cost of doing business to their customers, they just don't itemize their bills the same way, they tend to hide their costs.
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10-05-2010 @ 3:57PM
Ellen Carlberg said...
Let's remember about banks. Fifth/Third bank is no that I will never do business with again. I called to get my balance and since the account was in my husbands name they would only talk to him. I told them he wears two hearing aids and doesn't like to talk on the phone but that didn't stop him. After 20 minutes and a supervisor later I finally got the balance. Phone call number two was also to see what the balance was. I called their automated callin and was told we owe $96.00. I knew that this was not true -I had moved our charge to another card. I finally got JUDY who would only talk to my husband and when he couldn't answer a question and I had to help him she told him since I helped him she could not release our credit amount. We finally went to one of their banks, talked to a Customer Service lady and in 5 minutes she had paperwork for a check that would be mailed to us in 5 to 7 days. I will remember how this charge card callin treated us and will tell all of our family and friends about it. I will never use this bank again.
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10-05-2010 @ 4:06PM
Jinja said...
While I can see that some of these fees sound ridiculous, the customer is NOT always right. Why do people think that just because they choose a service they are suddenly entitled to special treatment?
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10-05-2010 @ 4:58PM
mark said...
Nearly every business backs republican candidates and nearly every republican politician backs greedy legislation. In the past they both tried to disguise thier greedyness and mean nature but today there are so many greedy people in our nation they no longer have to disguise to get elected. It's really no wonder why our nation is in the mess it's in now and probably come november you will see congress go back to thier greedy ways.
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10-05-2010 @ 5:52PM
CindyM said...
The airline loses your checked bag AND keeps the money they charged you to check the bag? That's a hoot! Since it's assumed that when you check a bag it will be returned to you at your destination, it would seem that this is charging for services not rendered, i.e. FRAUD.
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