When is it okay to axe a customer?
Sprint Nextel cancelled the contracts of 1,000 overly needy customers last month, by sending them letters in the mail that stated their service would be terminated as of July 30. The carefully selected group, the company indicated, was too costly to keep as customers because these users called customer service too much. With all the information about what it costs to acquire a customer, particularly in this cut-throat wireless carrier category, and Sprint Nextel severely lagging behind its competitors in new customers, were they right to let these thousand go?
Indeed, they may have been costly consumers to keep, but wouldn't have been easier to resolve the reasons why they were calling in the first place? Who wants to wait 30+ minutes on hold (which is what I waited the last time I tried to reach Sprint Nextel) to reach a low-level CSR for kicks? The bad press is telling, too, for the company. So, in the end, is it worth it to cut a bill-paying customer just to save a few bucks in the short-term?
