Tag Archives: credit cards

App Store, Apple, arrogance, Canada, cluefulness, Clueing, cluetrain, Cluetrain Manifesto, comment-fishing, DRM, experience, Google, iPhone, iPod, iPod touch, iTunes, linkfest, personal, Placeholders, ramblings, rants, responsiveness, shameless plug, Spoofs, wishful thinking

Apps and iTunes Cards in Canada: Follow Up

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Recently blogged about this issue: though information about this appears nowhere on the card or in the terms of service, iTunes Cards (gift cards or certificates) may not be used to purchase applications on the Canadian version of the iTunes Store.

Since I posted that blog entry, a few things have happened. I did receive replies from Apple, which were rather unhelpful. The most useful one was this message:

Hello Alexandre,

I understand and apologize about your situation and i do want to assist you as much as possible . I am going to issue you 10 song credit. Again i apologize and i hope this issue gets resolved. I will also apply feedback about this issue .

Thank you for choosing iTunes Store and have a great day.

Sincerely,

Todd
iTunes Store Customer Support

I had no intention of purchasing tracks on the iTunes Store at this point but I do “appreciate the gesture.” Here’s what I wrote back:

Thanks. I wasn’t planning on downloading songs but I appreciate the gesture.

Not overwhelming gratitude on my part. Simply stating that, though this isn’t appropriate, I can still be polite.

What’s funny is that I received this reply to my simple “thank you” note:

Dear Alexandre,

You’re very welcome. I’m glad to hear that i was able to help some .

Nothing makes Apple happier than to hear that we have pleased our customers. I hope that you continue to enjoy the iTunes Store.

Thank you for choosing iTunes Store and have a great day.

Sincerely,

Todd
iTunes Store Customer Support

From that message, you’d think I had praised the iTunes Store for hours on end.

Just in case it might make a difference, I tried filing another support request. Here’s the reply on that one:

Dear Alexandre,

Welcome to the iTunes Support Site. My name is Staci and I am here to assist you.

Thank you for contacting Apple about the App Store. We’re glad you’re interested in
this new offering.

I’m sorry, but you will not be able to purchase games or applications with store
credit or an iTunes Gift Card in Canada. Customers residing in Canada may only
purchase games and applications using a credit card.

I am confident that the information provided will solve your gift card issue. If
you have further questions, I can be contacted during the hours listed below. Thank
you and have a prosperous New Year.

Sincerely,

Staci
iTunes Stores Customer Support

This one sounds even more like a canned reply and  “the information provided” doesn’t, in fact, “solve [my] gift card issue.”

Clearly, Apple isn’t “doing the right thing.” In terms of customer service, it’s not a positive experience. I did enjoy some aspects of the iTunes Store and I think it’s quite convenient. But I’m not “enjoying the iTunes Store” so much, anymore.

In the meantime, I started receiving comments on my previous blogpost on the issue. One was from someone who purchased a 150$ iTunes Card. Almost as much as the 8GB iPod nano.

Most of the advice given on this issue, outside from Apple’s unhelpful replies, has to do with things which are illicit. One would be to resell tracks purchased with this card to other iTunes users. Since the tracks are now all DRM-free, this is technically feasible. But it’s also illicit and potentially traceable. Another piece of advice, to purchase applications using an iTunes Card, is to buy a card in the US. As far as I know, this is technically doable but it also contradicts Apple terms of service.

Not good solutions, but ones which disgruntled iTunes Card buyers may contemplate.

Since then, I also received a message asking me to complete a survey about my experience with Apple support. Here’s the complaint I included in that survey:

I was given the “runaround” on a very easy issue: I need a refund.
There’s an obvious problem with the fact that iTunes Cards may not be used to purchase applications on the Canadian version of the iTunes Store. Nowhere on the card itself or even in the Terms of Service is this restriction mentioned. As this issue gains prominence, Apple could get a significant hit in consumer perception. Not sure if it will become a class action lawsuit, but it’s as significant an issue.
Email replies were disappointingly unhelpful. Instead of investigating the situation, I was led to a forum post musing about the possible reasons for this restriction. I was eventually credited ten songs even though I had no intention of getting tracks on the iTunes Store at this point.
While the amount of money is relatively small in my case, I’m getting comments on my blog from people who lost the money equivalent of an iPod nano.

Again, I probably won’t file a class action lawsuit against Apple, in part because these suits mostly make money for lawyers. But my dissatisfaction with Apple remains. In a way, it even grows, because there were several opportunities for Apple to “do the right thing.” Yes, it’s partly on principle. But it’s also a matter of the way the corporation is perceived. In this case, they sound polite but quite dismissive.

There’s no question in my mind that a mistake was made: no information on this restriction was added anywhere a gift card purchaser may find it. Because of this, people are redeeming iTunes Cards with the specific intention of enjoying their iPhone or iPod touch in a new way. As this was a season of gift-giving, some people probably received these gift cards and, thinking they might use them anywhere on iTunes, redeemed these cards instead of returning them. Only to find out, after the fact, that “you will not be able to purchase games or applications with store credit or an iTunes Gift Card in Canada.”

Bummer.

This frustration isn’t such a big deal in the abstract. But context is everything. Part of the context is the set of restrictions placed by the iTunes Store in general. It may not have been much of an issue, for a given user, that it’s impossible to buy applications directly from developers, unlike Android Market (the Google equivalent to the App Store). For casual users, this is pretty much a non-issue, especially since the App Store is so convenient. But this restriction becomes quite conspicuous once an iPhone or iPod touch user runs into this kind of problem.

There’s a broader issue. With the iTunes Store, Apple is sometimes said to have “solved micropayment.” Ever since the iTunes Music Store opened, at least part of Apple’s success has been assigned to the Amazon-like way they implemented their payment structure and it’s quite likely that the iTunes Store model has been having positive effects on the way Apple is perceived by investors. Because of the way it handles payments and reduces overhead, Apple has been able to make money on relatively small amounts of 99¢ (and, recently, 69¢). I’d call this “minipayment” because one can easily imagine even smaller amounts being paid online (for instance, a minute of cellular or long-distance communication). In this case, Nokia, eBay/Skype, and cellphone carriers have better micropayment systems. But Apple still deserves “Wall Street cred” for the way it handles small payments.

Yet, once you start thinking about Apple’s payment system in more details, say because of a bad experience with the applications section of the iTunes Store, you start noticing how flimsy the payment structure is because it relies on users willingly entering a closed system. It’s not just that the iTunes Store is closed. It’s that, once you buy on Apple, you need to restrict yourself to “Apple’s ecosystem.” This has often been the case on a technical level. It’s now a matter more visible to the casual end user: money.

From a “tech media” perspective, this closed ecosystem is part of a pattern for Apple. But the financial part isn’t frequently discussed.

It will sound like a strange analogy but it’s the one with which I come up as I think about this: IKEA bedding. Because IKEA’s measurements are metric, bed linen was an issue with IKEA-purchased mattresses in Canada. Not sure if it’s still the case but it used to be that those who bought beds at IKEA were then stuck with metric measurements for bed linen and those are difficult to find in Canada. In effect, those who purchased beds at IKEA were restricted to IKEA linen.

In computer terms, the classic case is that of a difference in fileformat between products from two developers. Apple certainly had its share of “format wars” but it mostly solved these issues. Recent Macs (including the Mac mini Intel Core Duo I’m currently using) support a Windows installation as well as Mac OS X. In terms of networking, it’s now quite easy to set up mixed networks with both Mac OS X and Windows machines. Even the music part of the iTunes Store is lifting those restrictions which made them technically incompatible with other devices. All in all, Apple has gone away from its strict control, at least in technical terms.

But in financial terms, Apple is using a fairly restrictive model for its iTunes Store. Once money gets into an account (through gift cards, allowances, or “gifting”), it can only be used on that account. Because of some restrictions specific to Canada, some of that money is restricted from use for buying applications. And Paypal isn’t available as a payment option in the Canadian iTunes Store. In effect, the only way to purchase an application for the iPhone or iPod touch is through a valid credit card. Given the fact that a majority of people are likely to have some kind of credit card, this doesn’t seem too restrictive. But there’s a variety of reasons people may not have valid credit cards and there’s no connection between buying something on the App Store and using a credit card. The iPod touch has been marketed as a gaming platform during the holidays and chances are that some iPod touch owners are children without credit cards. I’m not sure what the options are for them to buy iPod touch games. The same could be said about games for the iPod Classic, a device which clearly is used by children.

Part of the problem relates to the Canadian financial system. For one thing, debit cards with credit card numbers are rare in Canada (I’m not sure they exist). Many Canadians tend to use Interac, which does offer some advantages over credit cards, IMHO. As I’ve recently experienced, Interac now works online. It would make a lot of sense for Apple to support it online (I’m sure Canadian Apple Stores already support it). And there must be a reason Paypal, which can be used for iTunes Store purchases in the US, is unavailable in the Canadian iTunes Store.

So, yet again, Apple’s Canadian customers appear “underprivileged” by comparison with US customers. In public perception, this is pretty much a pattern for Apple.

I don’t think that the messages I’ve received helped. Though they were polite, they were dismissive as my problem was basically dismissed. From being dismissive, Apple can sound arrogant. And arrogance is tricky, in today’s marketplace.

I’m reminded of the recent Simpsons episode about Apple. Excerpts of it made their way to YouTube as they play on several gripes people have with Apple. Arrogance was clearly a key theme in that episode. Another Apple parody, the MacBook Wheel spoof from The Onion, was more directly centred on making fun of users and elements related to Apple’s perceived arrogance were less obvious.

I don’t own AAPL.0 stock but, if I did, I might sell some. Sounds silly but corporations which treats its customers in this way aren’t something I would invest in. Despite the fact that I do “invest” in Apple products.

I just wish Apple “did the right thing.”

Anthropology, cluefulness, comment-fishing, Ethnography, friendliness, journalism, Malcolm Gladwell, profiles, surveys, Tech

Customer Service on the Phone: Netflix

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An interesting piece about the move, by Netflix, to phone-only customer service.
Victory for voices over keystrokes | CNET News.com

Much of it sounds very obvious. Customers tend to prefer phone support instead of email. Customer service representatives who take more time on the phone with customers are more likely to make people happy. Many customers dislike offshoring. Customer service can make or break some corporations. Customers often have outlandish requests. Hourly salaries in call centres will vary greatly from one place to the other, even within the same area.

In other words, Netflix has done what many people think a company should do. We’ll see how it all pans out in the end.

The main reason this piece caught my attention is that I have been doing surveys (over the phone) about the quality of the service provided by customer service representatives over the phone. Not only am I working in a call centre myself (and can certainly relate with the job satisfaction which comes from empathy). But several of the surveys I do are precisely about the points made in this News.com piece. The majority of the surveys I do are about the quality of the service provided by customer service representatives (CSRs) at incoming call centres for a big corporation. So I hear a lot about CSRs and what they do well. Or not so well. One answer I’ve been hearing on occasion was “I’d appreciate it if I could talk to people who are a bit less courteous but who know more about the services the company is providing.” After interactions with several CSRs and tech support people, I can relate with this experience on a personal level.

The general pattern is that people do prefer it if they can speak directly (over the phone) with a human being who speaks their native language very fluently and are able to spend as much time as it takes with them on the phone. Most people seem to believe that it is important to be able to speak to someone instead of dealing with the issue in an “impersonal” manner.

Sounds obvious. And it probably is obvious to many executives, when they talk about customer service. So email support, outsourcing, offshoring, time limits on customer service, and low wages given to customer service representatives are all perceived by customers as cost-cutting measures.

But there’s something else.

We need the “chunky spaghetti sauce” of customer service. Yes, this is also very obvious. But it seems that some people draw awkward conclusions from it. It’s not really about niche marketing. It’s not exactly about customer choice or even freedom. It’s about diversity.

As an anthropologist, I cherish human diversity. Think of the need for biological diversity on the level of species but through the cultural, linguistic, and biological dimensions of one subspecies (Homo sapiens sapiens).
Yes, we’re all the same. Yes, we’re all different. But looking at human diversity for a while, you begin to notice patterns. Some of these patterns can be described as “profiles.” Other patterns are more subtle, harder to describe. But really not that difficult to understand.

The relationships between age and technology use, for instance. The common idea is that the younger you are, the more likely you are to be “into technology.” “It’s a generation thing, you know. Kids these days, they’re into HyPods and MikeSpaces, and Nit’n’do-wee. I’m too old to know anything about these things.”

Yeah, right.

All the while, some children are struggling with different pieces of technology forced unto them and some retirees are sending each other elaborate PowerPoint files to younger people who are too busy to look at them.

To go back to customer service on the phone. Some people are quite vocal about their preference for interactions with “real human beings” who speak their native language and are able to understand them. Other people would actually prefer it if they could just fire off a message somewhere and not have to spend any time on the phone. On several occasions having to do with customer service, I do prefer email exchanges over phone interactions. But I realize that I’m probably in the minority.

Many people in fact deal with different situations in different ways.

One paragraph I personally find quite surprising in the News.com piece is about the decision to not only strengthen the phone-based support but to, in effect, abolish email support:

Netflix’s decision to eliminate the e-mail feature was made after a great deal of research, Osier said. He looked at two other companies with reputations for superb phone-based customer service, Southwest Airlines and American Express, and saw that customers preferred human interaction over e-mail messages.

Sounds like a knee-jerk reaction to me. (It’d be fun to read the research report!) I’m pretty sure that most business schools advise future executives against knee-jerk reactions.

One thing which surprises me about the Netflix move is that, contrary to Southwest Airlines and American Express, the Netflix business is primarily based on online communication and postal services. My hunch is that a significant number of Netflix users are people who enjoy the convenience of one-click movie rentals without any need to interact with a person. Not that Netflix users dislike other human beings but they may prefer dealing with other human beings on other levels. If my hunch is accurate to any degree, chances are that these same people also enjoy it when they can solve an issue with their account through a single email or, better yet, a single click. For instance, someone might like the option of simply clicking a button on the Netflix website to put their rental queue on hold. And it might be quite useful to receive an email confirmation of a “Damaged Disc Report” (SRC: DISCPROBLEM) instead of having to rely on a confirmation number given on the phone by a friendly CSR in Oregon or, say, Moncton.

Yes, I’m referring to the specific instances of my interactions with Netflix. While I’d certainly appreciate the opportunity to speak with friendly French-speaking CSRs when I have problems with plane tickets or credit cards, I like the fact that I can deal with Netflix online (and through free postal mail). Call me crazy all you want. I’m one of those Netflix customers who find it convenient to deal with the company through those means. After all, Netflix is unlikely to have such an influence on my life that I would enjoy spending as much as ten minutes on the phone with friendly Oregonians.

As an ethnographer, I have not, in fact, observed Netflix to any significant extent. I’m just a random customer and, as it so happens, my wife is the one who is getting rentals from them. What little I know about the Netflix business model is limited to discussions about it on tech-related podcasts. And I do understand that Blockbuster is their direct target.

Yet it seems to me that one of the main reasons Netflix has/had been succeeding is that they went into relatively uncharted territory and tapped into a specific market (mixed analogies are fun). Even now, Netflix has advantages over “traditional” DVD rental companies including Blockbuster the same way that Amazon has advantages over Barnes and Noble. It seems to me that Amazon is not actively trying to become the next Barnes and Noble. AFAIK, Amazon is not even trying to become the next Wal-Mart (although it has partnered with Target).

Why should Netflix try to beat Blockbusters?

What does this all mean for corporate America?