The True Value of Service Recovery

By Bob Morrell on September 3, 2018

So I watched the web like a hawk for some months, looking for a fridge freezer – right make, features and price. I saw it! Perfect. Ordered it. £1300. This is not a small fridge!

I ordered online and selected a free delivery on  Sunday, so far, so good.

 

On the Sunday I knew that the fridge was coming between 8.15am and 12.15pm. So I was up at 6.45am emptying the old fridge and getting if ready to be taken away. At 9.30 the call came;

‘Sorry our driver has called in sick so no delivery.’

‘Okay, could be worse, I’m assuming it will now arrive tomorrow?’

‘It doesn’t get any better - the earliest we can now deliver it, is Friday.’

‘Are you joking? – this is totally unacceptable.’

‘Right, what you want to do, is when it’s arrived and you’re sure it’s working, then call up and ask for compensation – you might get £25.’

 

On consultation with my wife we called back and cancelled the order. The person who took my cancellation made no attempt whatsoever at service recovery – she just processed the £1300 refund.

 

Incensed as I was I knocked out an indignant email to the CEO of the company. The next day, 2 things happened.

  1. A call from some bright spark to arrange my delivery on Friday. So I had to inform him that we’d cancelled. Total waste of time.
  2. The CEO’s office emailed me apologising offering no real reasoning as to why I was left to wait 5 days more through no fault of my own - and made a 10% discount offer if I would replace the order.  

So let’s look at the statistics here:

 

NPS Score – can’t wait to be sent that survey – that’s a 1. (Detractor, 100%, at least they called me)

I will never order from this company again, not for 10% off the fridge.

I will tell at least 10 people who this was and what was so useless about it – that’s 10 other people who will be less inclined to buy from this brand too.

The logistics have clearly been farmed out with no contingency planned for – so if you are reliant on delivery, then how in the modern economy can you be so lax?

If you’re also a retailer, as this company is, then how can you risk this? How can you allow untrained staff to take refund calls for £1300 a time? How many other people were disappointed that Sunday?

 

I think this little episode has probably cost the brand concerned £50k in lost revenue, both from refunds, bad feeling and lost business elsewhere.

 

We are in a delivery economy – like it or not. We are less inclined to buy from shops because we believe we can save time and money selecting and ordering online, and having it delivered.

So your delivery service levels are crucial,

1)      You must stand a minimum stress test,

2)      You must have a contingency,

3)      You must have fair policies for service recovery.

4)      You must have deals with outsourced partners to test their contingency.

5)      You must train your people to manage and own service issues.