Saturday, August 27, 2005

Not-so-good Customer Retention Strategies: AOL

Tried canceling your AOL subscription but the bills kept coming? Or worse yet, your credit card was still being charged for the service?

Looks like some Customer Service Reps we not canceling subscriptions when requested by customers, because a bonus of "tens of thousands of dollars" was at stake if "save" quotas were not met.

But thanks to New York State Attorney General, Elliot Spitzer, AOL will change their ways, including a $1.25 million dent to AOL's pocket:

  • Eliminate any requirements that its customer service representatives maintain a minimum number of "saves" in order to earn a bonus;
  • Record all service cancellation requests and verify action on the request through a third-party monitor;
  • Provide refunds to all New York consumers who claim harm based on improper cancellation procedures, up to four months worth of service;
  • Pay $1.25 million to the state in penalties and costs.

Quite difficult to disagree with this statement from Mr. Spitzer:

This agreement helps ensure that AOL will strive to keep its customers through quality service, not stealth retention programs.

Who's next? Cell phone or pay TV services? Any bets?