T-Mobile: Three Strikes and You’re Out!

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We have been customers of T-Mobile in Germany for more years than I care to remember. Too many years! Up until recently, we had six mobile contracts for different family members and uses. All in my wife’s name. T-Mobile thought she was a great customer as she was spending almost Euro 500 per month on the different contracts. We know that because one day she got a glossy marketing mailing telling her that as a ‘thank you’ she was being enrolled in an exclusive loyalty programme.

A few months back our eldest son, who used one of the six contracts, decided to downsize to a cheaper monthly plan. He didn’t use his phone all that much, wasn’t all that interested in a new phone and wanted to move to a much cheaper SIM-only plan. He was out of contract, a fact that T-Mobile had inadvertently let us know by ringing my wife to try and sell her an ‘optimised plan’ for the contract. Somehow, during the call they forgot to tell her the contract had run out and she was free to close it. Funny how T-Mobile only decides to let her know about the optimized plan the moment the contract runs out and forgets to tell her she can close it without penalty. My wife politely declined explaining she intended to change to a cheaper plan at a T-Mobile shop.

That weekend, we went to our nearest T-Mobile shop and asked to change the contract to a cheap SIM-only plan. The shop assistant was, to put it bluntly, unhelpful, sullen and rude. He told us things about the contract that were plain wrong, tried to pressure us to take another expensive plan and became very unhelpful when we insisted on the cheap SIM-only one. Irrespective of whether he was having a bad day, or whether he didn’t make enough commission on the sale, his behavior was simply unacceptable. It was all that I could do to stop my wife from giving the assistant a piece of her mind. We picked up the new contract and left the T-Mobile shop with a dark cloud over our heads.

Back home, my wife, still seething from trial-by-assistant at the T-Mobile shop, decided to review all of the T-Mobile contracts. We worked out that by closing some contracts when they ran out and downsizing others to much cheaper SIM-only plans we could save ourselves almost Euro 450 per month. For example, my private mobile contract was downsized from a Euro 50 per month contract I rarely used as I was always travelling, to a much cheaper Euro 5 per month SIM-only contract. My business contract, that cost up to Euro 250 per month because of extortionate roaming charges was closed and swapped for a pre-paid UK GiffGaff SIM (as most of my work is in the UK) that cost only GBP 10 per month, a saving of almost Euro 240 per month!

Because of a combination of patently self-serving behavior (the retention calls offering an optimized plan) and downright rude behavior (the awful assistant in the shop), my wife went from a customer with an estimated lifetime value of Euro 120,000 over the next 20 years (Euro 500 x 12 months x 20 years) to one with a value of only Euro 12,000. T-Mobile’s stupidity, greed and rudeness cost it over Euro 108,000 in lost future revenues.

T-Mobile’s marketers still haven’t got the message though. T-Mobile still sends my wife exclusive marketing mailings to thank her for her custom. Despite her having taken 90% of her business away. The latest one arrived only a few days ago, offering her the chance of a lifetime… to take part in a competition to win some great prizes: some headphones, some cooking implements, or a cocktail glass set. Talk about mindless marketing.

This true story is not an isolated incident. Hardly any of our friends are T-Mobile customers, and the few that are not very happy. They all have T-Mobile service disasters stories similar to ours to tell.

Customers are increasingly giving mindless marketers three strikes before kicking them out. It is not good enough to only be interested in customers when they are either about to sign a new contract, or in danger of defecting from an existing one. Strike One! It is not good enough to base your marketing on tacky gimmicks like gamification when the core product is fundamentally broken. Strike Two. And it is not good enough to abandon the customer to rude customer service that doesn’t deliver any of the brand’s values. Strike Three. If anyone from T-Mobile is reading this post, consider yourself well and truly fired!

Graham Hill
@grahamhill

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