How To Lose a Paying Customer


by Samuel Greengard

Hand some companies an arsenal of digital technologies and they find a way to blow themselves up.

Case in point: for years I carried a United MileagePlus Visa card from Chase Bank. I charged well into the tens of thousands of dollars a year on the card. I made payments on time. It's difficult to imagine that this wasn't a highly profitable arrangement for Chase.

Things began to unravel one Saturday when I went online to make my monthly payment. I authorized the transaction at around 3 p.m. Pacific Time. It turns out the cutoff was 2 p.m. Pacific Time (5 p.m. Eastern Time). And because the next day was Sunday the payment didn't post until Monday, thus exceeding the bank's one-day grace period.

The result was approximately $85 in finance charges on the next statement. Not surprisingly, I called customer support and explained my circumstances, also pointing out that I had made previous payments on time. I was greeted with an unfriendly "can't do."

The conversation went something like this: Me: "Could you please wave the finance charge based on my previous payment history with Chase?"

Agent: "We're unable to waive any finance charges."

Me: "May I speak to a supervisor?"

Agent: "I am unable to connect you to a supervisor."

Me: There's nothing else you can do?"

Agent: "No. I'm afraid you will have to pay the finance charge because you were late with your payment."

Me: I'd like to cancel my credit card immediately."

Agent: "I'd be happy to help you with this."

According to my calculations, Chase has lost at least a couple thousand dollars a year in revenues.

But wait, it actually gets worse.

Since cancelling the card I've received dozens of advertisements by mail and e-mail, promoting the, you guessed it, United MileagePlus card from Chase. Seems they now want me back as a customer and I'm reminded of this fact on a regular basis.

It's incredible that in an era or ultra-sophisticated business analytics tools and powerful customer segmentation software, companies continue to gouge out business by butter knife. Worse, this type of dysfunctional interaction with customers is the norm for a lot of companies. They skate by doing a mediocre or worse job--all while they tell you how much they value your business while you're waiting on hold.

Bank chases tail. Tail wags bank. Customer goes away.