Social Proof
Social Proof can work for your business, or against your business. It builds trust in your online presence by offering the good and the bad feedback that is part of the territory when you open your website to comments from your customers.
When you begin to see a trend of complaints it’s time to take action. If you allow the trend to go unchecked, you will damage your credibility and ultimately Social Proof will turn against you, and it could get worse.
It did get worse this week for a trusted online business that I have used without question and have refererd to my customers. I have always shopped price when I am about to buy a tech product. I don’t always go with the lowest price, I have to have confidence in the seller, and if I don’t I will pay the next higher pricer for the business I do have confidence in. It falls under my business plan of “once burned twice shy”.
I also do not consider any offer of a rebate against the price I am paying. The reason for that is simple. I used to file for them, all paperwork in order, always believing that I would get that check in the mail in the time specified. After being burned more times than I have fingers on one hand, I gave up on that idea, because chashing those rebates simply was not worth my time and the aggrivation it caused.
So, I was extremely frustrated and distraught when I read the article in yesterday’s South Florida Business Journal about TigerDirect.com (and their parent company in NY, Systemax) being sued by of all entities, THE STATE OF FLORIDA! Apparently their rebate process was a disaster and enough people filed complaints with the State to cause an investigation. That investigation lead to the lawsuit.
Wow. If you want to find one single way to lose most of your loyal customers, getting sued by the State where you have the most physical stores is a great way to do it! How does that affect me? I just referred $1800 of business to them last month alone. Of course, keeping with the plan, I never entered any of their mail-in rebates into the equation, so I won’t have a hopping mad customer, thank goodness.
Nonetheless, from a business perspective, there is absolutely no way this should have ever gone this far. The article tells of rebate information strewn on the floor, unable to ever be reconnected to the individual who submitted it, and that being ‘grounds’ for denying the rebate to the customer.
Friends, this is NO WAY to run your business. Finger pointing will NOT work either. It’s time for TigerDirect to immediately take action to mitigate the destruction that has already begun to their reputation in the State of Florida, where most of their physical stores are located (after purchasing stores from CompUSA when they went out of business).
Social Proof is gone for now. They need to stop offering mail in rebates and move to a platform where all the rebates they offer are ‘instant’. On the products in question that my client purchased, some had ‘instant’ rebates, some ‘mail in rebates’ and some had a combination of both. The price comparison I used excluded any mail in rebates, and with those removed TigerDirect.com still had the lowest prices and free shipping, thus they were the clear winner of my business.
Still, I have to tell you that this lawsuit gives me pause in referring them to my customers. It’s sad because they are the best at dealing with RMA (return) issues. I have always been satisfied with the products I’ve purchased from them – including the 65 inch HDTV purchased online last year for my daugher for Christmas. It arrive on time, in perfect condition and worked perfectly. It was $500 less than anyone else selling it and it was new and unopened.
Please, TigerDirect, do me and the other satisfied reselling customers who are consistently loyal to you a huge favor – IMMEDIATELY take action to remove mail in rebates from your products, and where possible, make them instant rebates. Then, make sure the email address list you have is well used by telling your customers of the change in practice, and offer them ‘instant rebates’ if they have purchased online from you in the last 12 months and filed a claim for an unpaid rebate. Let’s face it, you know who they are, because you most certainly maintain records of purchasing habits of your online customers that you send email blasts to. You also collect phone numbers at the store level for each purchase.
I know if I were you, that I could easily run a query on my database for any product with a mail in rebate and then compare it to the list of rebates that were paid out. Just for good measure, I would then go back to the rebate bank account and verify which checks hadn’t cleared and reissue them. It’s gonna cost you money? You bet it is, but jump out of that box you apparently are in and see reality – not doing anything close to this is going to cost you a ton more, plus your reputation, plus a heafty fine from the State of Florida who has a reputation for not liking companies who bilk their residents.
It’s time to be proactive, and no time to worry about litigation defense. Act quickly and I am sure the State of Florida will take that into consideration and settle with you. Limit your exposure, keep your customers and for God’s sake, DO THE RIGHT THING – RIGHT NOW!
Or, suffer the consequences…and consequences there will be, I can promise you that from my personal position on the matter as I will be sending my business elsewhere. Your customers are watching.
