Ever since Alexander Graham Bell invented the telephone, AT&T has been one of America’s crowning achievements. Over time it grew into one of the best-known and strongest brands. Then about twenty-five years ago things started to unravel for Ma Bell. They were dying on the vine and were acquired by SBC, the smallest Baby Bell out of San Antonio Texas. They also acquired BellSouth and Cingular turning them into a telecom giant. However, in recent years they’ve lost their way. They are not only hurting their customers, but themselves in the process.
Don’t get me wrong. I like AT&T. I want them to succeed. They were once an important brand and can be again. That being said, they must both take care of their existing customers and win new ones. And this is where their problems start.
This problem is not just with AT&T. Many other companies in search of the holy grail of growth sacrifice their most vital asset: their valuable customers.
So, let this be a wake-up call to company management and investors. Let me give you two examples of companies doing things right and wrong, and of how even when off track a company can still recover and thrive once again.
Apple is a success story. They connect with the customer on an emotional level. In other words, users love them. This has propelled them to become a leader.
T-Mobile was dying on the vine a decade ago. Then after bringing in a new CEO with fresh ideas, they went from the bottom of the list of competitors to number two behind Verizon.
Strong, emotional customer relationship is key for stability, growth
Developing a strong customer relationship is key to ongoing success and growth for any company.
Companies who put the customer first, develop a very loyal customer base. That’s what they can build their future on. This is as much an emotional connection as a practical one.
Historically, Ma Bell seems to have had a problem with customer relations. You may recall from the 1970’s, the Lily Tomlin comedy skit where she played Ernestine the snooty telephone company Operator on the TV show Rowan and Martin’s Laugh-In. You remember… one ringy dingy, then talk rudely to the customer.
Things got better for a while after they finally had competition. After all, treat your customer badly and they will leave for a competitor.
That being said, they have burned me and many others, more than once, and to make matters worse, they don’t seem to care. They simply move on without concern about the damage they caused and the wreckage they leave behind in their wake.
This was also the problem with the cable TV industry. Companies like Comcast Xfinity, Charter Spectrum, Altice Optimum and all the smaller players never cared about the customer either. Why should they? They never risked losing the customer because they had no competition. So, there was no risk in an unhappy customer.
Once competition was in play, things got better. Today, the cable TV and telephone companies are better than before. They want to keep the customer happy.
Why does AT&T burn loyal, long-term customers
Let me give you a personal example of how AT&T dropped the ball and hurt their customer. I had been their customer for more decades than I can remember. A few years ago, I wanted to simplify the mix of services I used. At home I had three phone lines, high speed Internet, wireless and more. Yep, the whole shebang.
My kids have grown and left the nest so I wanted to simplify my life. All I wanted to do was cancel one phone line, move one to wireless and keep the third, as is.
Simple, right? You would think this request should have been easy. After all, customers move and change services all the time.
Plus, I had been a long-time customer with these phone lines in this house for twenty-years already.
The result was a complete disaster. AT&T went ahead and cancelled my phone lines, period. That started a long and tumultuous process to find and install a fix.
And to make matters worse, they showed no concern for their mistake that impacted their customer.
After the lines were cut, I immediately contacted them to tell them about the mistake they made and simply request they undo the damage they just caused.
Their simple reply was they could not do anything about it. Once the damage was done, it was irreversible.
How AT&T lost their way with customer care in search of growth
This was a red flag in the story of a company that lost its way. Since then, I have learned of so many other similar horror stories from AT&T and in fact many other companies.
Why do some companies do such a lousy job of taking care of their most important assets… their customers.
The example I gave earlier about T-Mobile growing from rags to riches is another great example of how a company can repair itself.
However, to fix things, first the company must realize there is a problem. There is no reason for horror stories like this to ever happy to customers of any company.
Actions like these tarnish the hard won customer relationship that had been built over quite a long time.
Building a strong and lasting customer relationship is key to every business. It takes more than just a clever marketing campaign. It takes time, effort and caring.
AT&T ultimately lost big time after harming loyal customer
In this case, AT&T lost big time. After being a long-term customer for many different services, they lost me. And in fact, as I have learned, they have lost many other users as well. That is the heavy price of focusing primarily on growth and new business and ignoring or harming your actual customer base.
I want AT&T to win. I want them to continue to grow and be successful in the long run. That being said, in order for any company to be successful they must understand the problem.
The lesson AT&T must learn is the same lesson every executive at every company must also learn. You must keep two things in focus at the same time: One, take care of their existing customers and two, win new customers. If they do that well, they will continue to grow like Apple and T-Mobile, and also keep their investors satisfied.
