AOL’s PR Is Broken

    July 19, 2006
    WebProNews Staff

Just when it seems things can’t get worse for AOL, it appears they have a mole leaking information to The Consumerist has been on AOL like a boxer pup on a meatloaf since the “cancel my account” snafu, digging up internal memos and employee manuals. The public relations nightmare continues.

AOL's PR Is Broken
Does AOL Need New Spin?

Add the revelations in those internal documents to a bevy of other incidents that includes consumer backlash, a renewed Eliot Spitzer investigation, Geronimo-ing subscribers, pottymouthed Netscape employees, worst-of-the-worst product reviews, and seeds of distrust sown during the Goodmail fiasco, and you have a company whose hot water has reached boiling.

Soon after Vincent Ferrari went national with his recorded phone call to AOL, where he was badgered by a retention consultant ignoring Ferrari’s demand that his account be cancelled, the Member Services team was sent a flurry of memos and policy changes.

According to the memos, EVP of Member Services, Scott Falconer called the aftermath of the incident “severe,” and employees were instructed to assume that any call could be recorded and posted on the Web. Falconer pleads with his staff to be extra helpful to all incoming callers. The Member Services crew also received an update instructing them that they were only to pitch the canceling member two offers before acquiescing if the member declines both.

The new instructions to be nice to customers, even if they’re canceling, does not seem to apply to AOL-owned Netscape employees, especially if they’re dealing with a former customer who caused all this trouble to begin with.

It would appear (though names can be forged in comments sections) Netscape’s Matt Gabels didn’t feel a need to remain anonymous when commenting, nor to visit Ferrari’s blog from outside company walls when he decided to sling profanities at the man. Also via the Consumerist, Gabels calls Ferrari a “poor excuse for a human” and “a laughing stock within AOL.” Another commentator, whose anonymous visit tracked back to within the Netscape camp, uses a colloquialism for a male member to describe him.

Perhaps the nastiness AOL seems desperately trying to correct in the aftermath stems from its own policies. New York Attorney General Eliot Spitzer, who fined the company $1.25 million last year because of the difficulty in canceling subscriptions, said he will investigate to see if AOL has held up to the terms of the settlement.

Under the agreement, AOL would hire a third party to verify the quality of retention calls, a move that Falconer humorously calls “an industry first initiative” as if it were not only AOL’s idea, but AOL’s choice as an industry pioneer. But also the agreement requires AOL to drop its system of bonuses that encouraged employees to maintain a retention level of 49 percent.

The Consumerist says that dropping the pressure of a bonus system morphed into a quota system that requires 60 percent retention, and that is job contingent, raising the pressure to retain that much higher. If so, we may understand why “John” was so desperate to talk Ferrari out of canceling, even if he had to get testy with him.

But also, a leaked retention manual reveals that cancellations were made difficult by design, even after Spitzer had slapped the company for that very reason. In the manual, Member Services employees are equated with sales teams, equipped with a multi-step system for dealing with cancellations. A cancellation request is to be considered “a hot lead.”

From the manual:

    Most other sales jobs require you to create your own leads, but in the Retention Queue the leads come to you!

It is probably widely whispered and reasoned among employees the key difference is that most other sales professionals focus on people who are actually interested in their product and don’t already hate it. Since in the hot seat, as has been mentioned, the process has been expedited.

So once again the PR nightmare comes down on Nicholas Graham, who, really through no fault of his own, enjoys the onus of spinning this particularly onerous series of events. He says what he has to say, even if the company demonstrates otherwise. Consumerist comes down on him as well:

    In a public statement, AOL’s Nicholas Graham claimed that John, “violated our customer service guidelines and practices, and everything that AOL believes to be important in customer care – chief among them being respect for the member, and swiftly honoring their requests.” If this is true, then why is there such a complex system designed to thwart those very requests? Brevity thrives on simplicity.

Yeah well, Graham says a lot of things, and the company has a history of too-little-too-late clean ups. Jon Miller has his work cut out for him too. Hope they have good dancing shoes.


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