Absent Minded Transactions – The Next Big Challenge?

absent mindedIn our respective industries we are always looking for the next big thing. Sometimes that can turn around to bite us where it hurts.  In the last ten years companies have shifted from an opt in strategy to an opt out strategy which puts the onus on customers to get out of a product or service change that almost always results in incremental costs and/or reduced services.  These efforts, when combined with recurring billing and a lack of transparency creates the perfect storm for customer retaliation and call center overflow.

Why are companies going down this path?  Traditional businesses are following the success of internet companies that make a killing on what I call Absent Minded Transactions (AMTs).  AMTs are monthly or annual recurring charges often connected to free trial offers that are bundled with other products.

In a consumer survey conducted by Ventura Consulting, as many as 70% of respondents indicated that they had AMT transactions that cycled through at least 4 times before they called to stop billing.  Of those 70%, only 20% asked for a refund.  When we asked the 20% whether or not they would do business with the company again, 100% said absolutely not.

These transactions are also catching the attention of regulators. If we are in the business of selling and protecting dreams, we better make sure that they don’t turn into nightmares for our customers.

Some quick areas for focus might include looking at 1) retail marketing and sales practices, 2) call center notes via text analytics for words like refund/cancel/billing, 3) customer attestation and adoption processes and 4) product configurations.  Our customers are our greatest asset so let’s keep them around by doing the right thing.

Categories: Motivational

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