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The importance of customer loyalty basics

customer services, bell, desk, helpTelstra is a retailer. Not necessarily a traditional retailer, but they retail airtime, they have retail stores and they sell merchandise. Loyalty in this industry is fickle. Subscribers will move to another retailer based on price alone. Despite regular calls from competitors, I personally have consistently remained with Telstra. I have found their service to be pretty good, and when I complete those surveys at the end of a call, I invariably give them 10 out of 10.

Until yesterday, that is. It takes just one monumental stuff-up to put customers off for life and the recent spate of outages is just such a stuff-up. Years of building customer loyalty flushed down the toilet.

I am totally disinterested in the reasons for the outage. I am a customer and I know what I want and I know what I pay for.

During this saga, I spoke to a nice young man who did his best to assist me. He really was very helpful. Inevitably we got to speak ‘modems’. I learnt my lesson many years ago when calling Telstra and being asked what modem I was using. At that time I used to buy modems from Officeworks or Dick Smith, invariably an obscure brand. When I spoke to Telstra in the past with an issue and mentioned the brand, with a hint of glee in their voice, I was told that Telstra didn’t support that brand of modem. It was then that I decided to purchase only Telstra modems, albeit usually at a premium price.

The helpful young man enquired down the line what modem I was using, of course. With glee, this time in my voice, I advised him that I was using a new Telstra Standard Business Gateway Technicolor modem. To my utter surprise – and disdain – I was told that I should borrow a friend’s modem, provided it was not a Telstra modem, and try that. There had been reports that Telstra modems were part of the problem and an obscure brand may just work.

After regaining my composure, I tried to intellectualise what I had just heard in retail terms. I couldn’t. I was eventually offered a Wi-Fi mobile modem free of charge. It did not work, so I phoned Telstra again to be told that the Telstra mobile service was undergoing maintenance and that was the reason the modem would not work. This seems a standard response from Telstra. Our area must be the most well maintained in Australia! I returned to the shop to learn that it had nothing to do with the mobile network. There had been an issue with the SIM card and the activation process. I was finally able to connect, albeit the speed is atrocious. This whole process took four business days.

My internet connection has now been down for a week and I’ve spent around six hours on the phone to Telstra in the Philippines. I’m preparing an invoice for Telstra. They will have 30 days to pay. If not paid within 30 days, they will receive a letter of demand. 30 years of loyalty gone and replaced with an adversarial environment.

So as a retailer, when you are thinking about your loyalty program with all the bells and whistles, be sure not to forget the basics. Loyalty is built on years of well-managed interaction – and one major glitch can render all your efforts null and void.

Stuart Bennie is a retail consultant at Impact Retailing and can be contacted at or 0414 631 702

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