giffgaff: what impact will the 8 hour service interrruption have on brand reputation and customer loyalty?

The giffgaff network: 8 hour service outage

Last Friday (16th) the giffgaff network went down and it stayed down for 8 hours.  It is not unusual for a mobile network to go down, it happens and many of us don’t even notice it because the outage last a couple of hours.  The giffgaff outage did get noticed – it got noticed by my wife, my son and plenty of other customers.  In our case the impact was not earth shattering.  Yes, my son who was feeling unwell was left hanging around outside for 50 minutes because he could not reach his mum.  As he said, it was annoying to have wait for 50 minutes when you are feeling ill but it’s not a big thing. For me, it is no big deal as I have two phones and had access to a second network that was working fine.

I think about switching until I get this email

The interesting thing is that the service outage did get me wondering as to whether I should switch the family over to say O2.  That was until Fri 16/03/2012 21:24 when I got this email:

We’re sorry

You may have experienced loss of service today (Friday 16th March), we’re sorry for the inconvenience this may have caused you.

This was due to a burst water pipe which took out the power at one of our 3rd party suppliers. Engineers have been working on this and have put a fix in place which we are now monitoring for stability. During the period where service is restored you may notice that your service is intermittent.

We’re continuing to work on this issue and regular updates will be provided in the community Noticeboard. Additional information is also available via our Blog where our CEO Mike Fairman has popped up a quick update.

Once we are sure that full and stable service has been restored for all members we will look at ways to make it up to you.

Again, sorry for the inconvenience.

Regards,

The giffgaff team”

Upon reading this email my reaction was “I’m sticking with giffgaff!”  Why?  The email struck me as the kind of response that I would expect from a decent and professional human being who had mistake and was now doing everything to make things right.  No, that is not enough.  It occurred to me that this is the kind of email that can only come from someone who has heart – who cares about doing the right thing.  Specifically:

  • The subject header is exactly right -“We’re sorry”.  Isn’t that what we expect and what our friends/family say when they have messed up?
  • The cause of the outage is explained;
  • It provides reassurance (we are continuing to work on it) and access to more information (Noticeboard, blog) for those who need it;
  • The line “Once we are sure that full and stable service has been restored for all members we will look at ways to make it up to you.” is a perfect line.  giffgaff get that whilst it is important to make it up to their customers, it was even more important at that time to deal with the issues (e.g. number porting) that had piled up (and were impacting) customers.
  • The email doesn’t just start with sorry it also ends with sorry.

What does the customer base think?

I trawled through the comments left by customers and the ratings of the comments.  Based on that I’d say that the customer base is split into two camps – polar opposites of each other.

The first camp is not happy with an 8 hour outage and it is best characterised by the following comment:

“I’m with the people who are wondering how this can possibly happen.

We get it, accidents happen, you can’t plan for everything etc… but for one water burst to knock out your entire network is unacceptable. Sure a lot of people just couldn’t text their friends or whatever, but some people might have had an emergency and were without a phone.

I’m glad I had the foresight to buy myself a backup pay as you go orange sim card in case this happened, I would never have done that with any other network…but with giffgaff, I felt it was necessary.

You can’t keep customers with your amazing prices alone, you have to provide a good and reliable service.”

The other segment of customers get that the service outage was a pain and yet give giffgaff full credit what they are about (the value proposition) and how they went about addressing the service outage.  This is best captured by the following comment:

“Thank you GiffGaff employees for getting our network back up and running. Was a hell of a pain without service but hey these things happen, maybe it can be classed as a learning curve for the future. I love GiffGaff and won’t leave you because of the occasional hick cup. Im sorry that so many people feel the need to complain, we have all suffered one way or the other because of this, but for god sake people find something to moan about that really is worth moaning about. You get great value from GiffGaff and they work hard for us when things do go wrong. So stop whingeing and give them a cheer and a big thank you for working so hard to fix the issue.

THANK YOU GIFFGAFF AND ALL YOUR EMPOYEES FOR WORKING SO HARD.”

What are the implications for giffgaff?

If I have read the comments correctly then I’d say that giffgaff have not burned their bridges with the bulk of their customer base.   To the contrary, most of the comments were positive about giffgaff.  Yet giffgaff does have an issue.  Why?  The phone is not just a device, it is THE device for most people; once customers sign-up with a network they expect it to work perfectly and all the time.  They might not notice short service outages, they definitely notice longer service outages: 8 hours is a long, long service outage.

My advice to giffgaff? You have done a good job in the way that you handled the service outage.  And that kind of service outage should not have happened.  So you should do the following:

  • take this opportunity to learn what needs to change (technology, processes, people….);
  • let your members (customers) know what you are doing to make sure that this kind of outage NEVER happens again;
  • invite (and engage) your members to play their part in what needs to happen – that way it becomes something that we do together, that way the ‘ownership’ of giffgaff continues to be distributed;
  • keep your promise and make it up to them – you can use this as an exercise to build more rapport with your customer base if you go about it in the right way.

Final observation

The impact of the  CEO’s post setting out the position (status) and offering an apology is interesting: many customers found that comforting / reassuring  and as a result it generated goodwill for giffgaff.  That strikes me as being an example of a leader leading.

What we can learn from the IBM 2011 CMO study (Part 1): think social transformation

We are talking about social transformation

I assert that we are taking part in the wrong conversation: customer-centricity.  Yes, customer-centricity matters and it is an important conversation.  I get that.  What I am saying is this: focussing on customer-centricity is liking focussing on a new baby and forgetting about the mother.  How the baby turns out depends dramatically on the mother and the broader context that gives being to both the mother and the baby.  So what should we be talking about if we wish customer centricity to flower?  Social transformation.

I have been re-reading IBMs 2011 CMO study and the following quote jumped at me:

“The empowerment of the consumer is generating more complexity.  The mental model is changing and we are facing a major social transformation”  CMO, telecommunications, Brazil

What are the underlying factors that are driving the need for social transformation?

What are the underlying factors causing this complexity, putting unbearable stress on ‘business as usual” mode of operation and thus pushing towards social transformation?   This is what I have picked up from the IBM 2011 CMO study:

We live in a world where no secret last five minutes. Today, it is impossible to control any confidential information.  Everything leaks.  We need to be better and faster, constantly.  This is the agenda we need to apply to marketing and business as a whole.”  Marketing Director, Natura Consumer Products

The IBM report rightly points out that corporate character (and not just the brand, advertising and PR) counts given that everything leaks (think about Apple and the consumer outpouring over its supply chain, particularly Foxconn):

“Customers can now find out where and how a company makes its products; how it treats its employees, retired workers and suppliers; how much it pays top executives; how seriously it takes its environmental responsibilities and the like.  This knowledge can affect their buying decisions. In other words, what an organisation stands for is as important as what it sells.  It has a “corporate character”……the sum of everything its management and employees say and do – the beliefs they hold, values they profess and ways they behave, visible for all to see.”

What does that mean for corporations?

Here are several quotes that suggest the direction that corporations are going to have to take, sooner or later, and irrespective of how the people in these corporations feel about the issue:

“We have to manage the reputation of the brand in the context of the vulnerability caused by the new digital world, by being honest, transparent and genuine.” President, Dunkin Donuts (India)

“Traditionally, corporate culture and character have been managed by HR, but it can’t remain there in a digital environment.  The world of separate internal and external messages is gone.  Internal actions, memos and decisions can impact your brand just as much as an advertising campaign.”  CMO, financial markets, USA

In the next post, in the series, I will set out the challenges facing the marketing function and how they can be addressed. I thank your for your listening.