Companies and the Customers Who Hate Them Essay Example for Free

Companies and the Customers Who Hate Them EssayHow privy customer dissatisfaction lead to higher shekels for the company? Companies beget found out that ill-informed customers can be beneficial for them in terms of profits. nearly companies have abused their customers intention all toldy, however others unwittingly exploited and took advantage of them. The Slippery slope There be two major airs in which companies make profits by misleading their customers * Offering the customers a broad variety of services or products, which can be very confusing, especially when there is privation of transpargonncy. Moreover, if steady the information is complete for the customers, the companies can engross advantages of consumers difficulties in predicting their needs. * Using fees and penalties for offsetting costs and discouraging unwanted customer behavior. These hostile strategies are common from banking and hotel industries to video stores and car rentals. Here particularly 3 in dustries lead be discussed in details cell bring forward industry, retail- banking industry and health club industry. Cell phone industry When a customer crosss up for a service plan, he chooses a certain set option with different ranges of minutes.These plans can have various restrictions and allowances. However, these varied plans are non a bequeath of customer-centric schema. They are rather ways to take advantage of customers unawareness of which plan to choose, in the result of which customers can be penalized either for using too much time or for not using enough. However, such strategies cannot always guarantee profits for the company. They can increase the dissatisfaction among customers, the proof of which can be thousands of complaints that the U. S. Federal Communications Commission gets annually.These complaints should be worrisome to companies because customers can switch toward a transparent and well-disposed alternative. Retail-banking industry Another sphere in which the company-centric strategy is used is retail-banking industry. For signing up in the checking accounts multitude are offered dozens of alternatives. If the customers cannot precisely predict their needs, they can have losses. Here are some examples of situations when the banks take advantage over the customers ignorance * The customers receive less interest when the consumers balances are above the minimum of the balance pailful and if the alances fall below the minimum level, they have to pay some penalties.* Banks usually debit the consumers checks in the enunciate of size, rather than in a chronological order, for the rest of the checks to bounce and to cause multiple overdrafts, consequently penalties. The company-centric strategy of banks led to the customers dissatisfaction and it became so pervasive that New York congresswoman Carolyn Maloney reintroduced the Consumer Overdraft Protection Fair Practices Act to forbid banks charging overdraft security measures f ees, unless the customers explicitly are informed about the service.Health club industry Health clubs tempt customers to sign long-term contracts, knowing that they will rarely visit the club. They realize that all their customers will not only use the facility and therefore sell to a greater extent memberships than they have the floor space to accommodate. Moreover, an investigation conducted by the New York City Council concluded that 41% of clubs didnt explain their fees in writing, 81% didnt restrain potential members a contract to read at home and 96% didnt inform customers of all the ways they could legally cancel a contract.In New Jersey a lot of complaints have brought litigation against al or so two dozen health clubs that provided fraudulent contracts. Health clubs require to spend more time to attract new customers because their existing ones try to find a way out. Moreover they even encourage ways to retain customers with reward points for members who work out regularl y. The warning signs According to the research most of the executives are acknowledging the negative effects of the functions described above but they mention that those actions do not move an intentional strategy.The executives know that because of these negative practices the companies slid down the slippery slope and have difficulties for purchasing on the way back up thus becoming vulnerable for the competitors. For avoiding this practice the executives should ask themselves the questions mentioned bellow. * Are our most useful customers those who have reasons to be dissatisfied with us? * Do we have rules we want customers to break because doing so generates profits? Do we make it difficult for customers to understand or abide by our rules, and do we actually divine service customers break them? * Do we depend on contracts to prevent customers from defecting? Climbing back into favor Effective CEOs are able to recognize the opportunities and eliminate the negative effects wh ich make the company vulnerable. The company centric strategies can cause loss of the target market and profitability in a long-term period, thus many another(prenominal) companies prefer being economically sustainable.