the disloyalty that globe handyphone's loyalty and rewards program creates

marketing 101 says loyalty and rewards programs are very effective tools in keeping subscribers happy with your service and more importantly to stay loyal. that means loyalty and rewards programs are meant to prevent existing subscribers from cutting off their subscription with the company and switch to a competitor.


it is also much more cost effective to keep customers loyal than to look for new subscribers. marketing and acquisition costs for new customers is much higher and much more difficult for companies.

what makes all of these critical is that the mobile phone service industry is probably the most competitive mass consumer market in the country. we know this with the unending and heavy advertising and promotions launched by the top three competing companies – sun, globe and smart.

the three competing companies offer unique plans and a full range of options for the consumers to choose from. many of these are value packed, offering very low cash outlay and monthly fees. when the market already competes on price, you know that the market is reaching maturity and is already near saturation point.

the market is also reaching near-saturation point where a large part of the demographics, in practically all segments already own a cell phone and already subscribe to a mobile service provider.

what this tells you is that a mobile phone service provider’s way to market share and revenue growth is to (1st) keep your current customers loyal; (2nd) increase usage of loyal customers through more value added services and (3rd) gain new users.

what is the point then that globe has kept it’s loyalty and rewards program secret from it’s subscribers?

we have been getting some feedback from a yahoogroup we are a member of. members are saying the loyalty/rewards program of globe has been there for a long time, it’s just that they don’t tell their subscribers about it. you only get to know about it by accident – from friends or when you call their hotline number and accidentally ask about it.

apparently, smart is less secretive about their loyalty/rewards program. smart puts it in fine print on your cell phone bill to let you know about it. it is in fine print but at least you are told about it. globe does not put it anywhere in your bill and they don’t tell you about it when you call them. you get to know about it only when you ask them about it.

for me, keeping the loyalty/rewards program a secret from subscribers indicates insincerity. why would you develop a rewards/loyalty program when you don’t intend to let your customers know about it? keeping it a secret from subscribers is very much equivalent to not having one.

we are familiar with rewards/loyalty programs - the SM group has one, mercury drugstore and national bookstore as well. these stores publicize it with posters and their cashiers ask you if you have one. if you don’t , they will ask you if you want to get one. to these stores, it’s not a secret they actively recruit members to it.

the most obvious negative effect of keeping it a secret from subscribers is that the program is not being used as a tool the way it is intended to be used. not having a lot of subscribers using it also says the program is not achieving it’s objectives.

there is a feedback given in the yahoogroup we are a member of - this subscriber has been with globe for a long time, since year 1 of globe operations in 1996. she accidentally found out about globe’s loyalty/reward program from a friend. she calls the hotline number to inquire about it and globe did not even apologize for not letting her know about its existence. disappointed, she closed her globe account and switched to smart. since she moved over to smart, she has gotten 2 new cell phones as her reward and is very happy with smart.

in that incident, the loyalty/reward program that was kept a secret actually caused disloyalty from a subscriber. it achieved the exact opposite of what it is supposed to achieve.

we know that smart telecoms monitors their churn numbers on a daily basis. churn is the result of subtracting the number of subscribers dropping the service versus the number of new subscribers joining the service. having a positive churn means the total number of subscribers is increasing while a negative churn means the number of subscribers is shrinking. a positive churn means increasing market share of number of users while a negative churn is a decrease in market share.

to smart telecoms, it’s important that they continue to grow in market share. a negative churn turns them into a panic and will immediately launch new programs to entice new users or keep existing ones.

that is the kind of marketing that smart does and it shows as smart continue to be the dominant mobile service provider in the country.

smart has an interesting history. smart actually built their market through very aggressive marketing.

smart was not the market leader when they started in the market. piltel which was still owned by pldt and separate from smart was the market leader. globe entered the market and took leadership away from piltel. through aggressive marketing, smart over took both piltel and globe and since that time, smart has not only sustained it’s leadership, it has achieved dominance.

in case globe is wondering why they are unable to get switchers from smart subscribers, perhaps the answer can be deduced from this incident – smart does not keep their loyalty/rewards program secret from their subscribers, they tell them about it. smart users are loyal subscribers because they are hooked by their loyalty/rewards program.

on the other side, in case globe is wondering why they keep losing their post-paid clients to smart – it is probably because they have kept their loyalty/rewards program a secret from their subscribers.

posted here: http://wawam.wordpress.com/2010/04/19/globe-telecoms-secret-loyalty-and-rewards-program-that-creates-disloyalty/

the globe handyphone experience - when customer service turns into a disservice

we will be starting a series of articles on the customer service and call center experience in the philippines. this is the first one, with globe handyphone, first posted here: http://wawam.wordpress.com/2010/04/18/when-customer-relations-hotline-service-is-not-hot-and-a-disservice/

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there was a time not long ago getting some customer service was very difficult. if something goes wrong with the telephone service you subscribe to, it was not easy to get it resolved. first you might not know what number to call. if you get connected to someone, that might not be the person who can help you. if you talk to somebody, it will take a long time to get it resolved.


a silver bullet called customer relations service was invented. companies have set up these with the thinking it is best from a business standpoint to satisfy an existing customer and prevent that customer from dropping your service or product and move to competition. studies show that it is much more costly and much more difficult for a company to get new users or customers than keeping an existing one. the thinking is that you do your best to prevent your customers from dropping your service to move to other companies. this is much easier to services like a mobile service than products like toothpaste or shampoo. service companies have the luxury of talking directly to their customers, making customer retention an easier task.

modern marketing is also a very competitive one. two to three competing companies are fighting for the same customer. when a current customer is already using your product/service, it will be much easier to convince that customer to stay on since he/she already has experience with your product/service. converting a new customer puts you on stage 1 of the product preference cycle not to mention your competitors are most likely also going after the same customer.

pair the idea of customer relations with another emerging trend called the call center makes it even more potent. with call centers, dispensing customer relations will be much more efficient, makes it standard and more importantly very quick. this pair builds more loyal customers.

or at least so goes the theory.

that is the theory part because in practice, in this case with globe handyphone in particular, that might not be true at all and has the effect of the exact opposite.

we have been experiencing globe handyphone’s customer service hotline in the past weeks and this is where we are:

the first call we made to globe handyphone’s hotline service was on march 20. it has been unresolved as of this writing – now 30 days.

since march 20, to follow-up, we have made a call to the hotline number at least 14 days out of the 30 days for an average of 1 call every other day. since april 1, this was more frequent with calls almost on a daily basis. the average will go much higher if you subtract 4 days from the total because of the holy week period when there was no work.

we have accumulated a total of 6 reference numbers on the same topic and complaint

we have on file the names of at least 16 call center agents and 4 supervisors (with their corresponding ID numbers), in total at least 20 who we have talked to on the phone

we have talked to 3 supervisors who promised me they will call me back within the day to tell me when someone will call me but he/she never did

obviously, the globe handyphone customer service hot line is a failure in my case. i have been calling them for the same problem for 30 days now and it continue to be unresolved. some observations:

i don’t understand why they need to give me a separate reference number every time i call when it is exactly the same topic. towards the end, i refused to accept a new reference number as having a new one gives it a more recent time stamp and just delays the call back time aside from the fact that it is just confusing.

every time i called them, they will tell me someone will call me within 3 to 5 working days.

first, i don’t understand why it will take them 3 to 5 working days. taking a full work week i think is just too long. that is extremely slow service specially when it is to resolove a problem. it will take half a day to stop subscription and move to another mobile company.

saying each time someone will call you in 3 to 5 working days just extends the period. they actually never called back. it has been 12 working days since april 1 and no one has called me back yet. it has been 11 working days since april 2 and no one has called me back either. the list goes on.

the call center agents keep asking me for my number where they can call me back. this question kills me and is most irritating. i am a subscriber to their cell phone service why will they not know how to call me? is my cell phone number not in their record? i have also given them my landline number a long time ago, they did not keep that on file?

that is the same problem with my email address. one of the agents asked for my email address. i gave it to them but 5 days after, talking to another call center agent, she asks me again for my email address. that means the first person who asked me the info did not file it in their system.

what is the point of asking a customers for their contact numbers and email address when they don’t bother to save it in their system?

they also have this habit of asking for the past history of the calls when these are supposed to be recorded in their system. we would be asked when and with whom we have talked to during previous calla.

instead of answering, we asked them – do you have my file open on your monitor? a few would say yes. most will ask for 30 seconds to open my record on their computer. i don’t understand this – why would they not open my record at the start of the call?

then i ask another question – can you not see the history of my calls on your computer screen? the answer is yes sir, it’s here. so we ask – why are you asking that question when you will know the answer just by looking at your computer screen? no reply. then change topic.

customer relations dispensed through call centers is supposed to make customer servicing much more efficient and quicker. my experience so far with globe handyphone is it is mostly inefficient and very much slow. the whole system simply does not work nor is it giving globe the speed and efficiency they were supposed to get in investing in computer systems and hiring or outsourcing call center services.

neither are their customers happier and more satisfied with their service. if at all this customer is angrier and more disappointed at the kind of service they were giving us. we have been a globe handyphone customer for the past 11 years and never missed paying a single monthly bill. this is my first major call to them that is service related. we have made no more than 4 calls within that 11 year period. globe is making a lot of money out of my subscription to their service – monthly bills paid on time for 11 years and with only 5 calls made to their call center. we are not a bother to them and we pay them good money.

the systems they have put in place, the customer service and call center facility is meant to make things easier and faster for customers, our experience with them so far is anything but fats and efficient.

the above customer service experience is just on the first level in resolving the issue we have brought to them. apparently there is another department who is in charge of resolving the issue. unfortunately it is this other department that has been very unresponsive.

all the call center agents and supervisors we have talked to have said they have sent urgent requests to have my issue resolved by that other department. it is also the other department who is supposed to call me about my problem. it looks like the continuing problems i have been encountering with them is being caused by that other department.

the name of the department — the Loyalty Group or the Customer Relations Management.

we think it is the ultimate irony that the department who has been unresponsive to a customer relations complaint is the one in charge of “loyalty” and “customer relations”.

the experience so far, for the past 30 days is one that does not inspire loyalty to globe handyphone on our side nor do we think their non-action and unresponsiveness is good “customer relations”. for sure the mission of the department is to “build loyalty” among current customers and to “ensure good customer relations” among subscribers.

with this performance and the way they have set up their system – what then is the point of putting up a “loyalty group” and a “customer relations group”?

tomorrow will be 31 days of unresolved loyalty and customer relations for us.