Classless.com

Okay, this business debacle did work out fine for me, however I could not resist using title anyway.

If you are wondering if today's lesson in business has to do with a case from Classmates.com, you are absolutely correct.

I have long since abandoned using my gold membership at Classmates.com. In the past year, I think that made a connection with one person from my past that I may not have met without having their expensive upgraded membership. However, at the risk of offending that person, I feel that that hardly justifies my membership in the service that seems to operate in a similar fashion as the typical online dating service ("looks are free, but contacts are gonna cost ya"). Seeing as I'm married, not to mention the Facebooks and MySpaces of the world that make connections both simple and free, Classmates is well behind the social networking curve.

Unfortunately, I screwed up.

I forgot to cancel my service and was charged $39.00 for my next year of service.

I immediately realized the problem and contacted the company:

"Please cancel my Gold membership and refund the recent $39 charge to my credit card. I no longer have an interest in your paid service and wish to return to the free service effective immediately Failure remedy this situation prior to Friday, December 7 at 5:00 p.m. CST will result in a fraud investigation against Classmates.Com with my credit card company. Thank you for your prompt assistance in this matter."

This was a stern email, but polite, straight-forward, and offering an opportunity for the company to resolve the problem prior to taking further action.

Their response:

"Thank you for contacting Classmates. I'm more than happy to assist you.

I’m sorry to hear that you want to cancel your Gold membership. Since you’ve already paid for your Gold membership, I have removed you from the automatic renewal program so that you won’t be charged again.

You may continue to use your Gold membership features until the end of the current membership term, which is Nov 28, 2008. At the end of that term, your membership will revert to a FREE membership.

For your benefit, I’ll take a moment to explain how you were enrolled in the automatic renewal program. While purchasing your Gold membership, you were presented with information just above the Submit Payment button explaining that your membership will automatically renew. Additionally, you have the option to remove this feature at any time by logging into My Account and then updating My Membership Information.

Again, please be assured that I have removed you from the automatic renewal program and you will not be charged again.

Thank you for being a Classmates member. We hope that you'll continue to get the most out of your membership by locating and staying connected to school friends, coworkers, and military buddies.

If you have any further questions or concerns, please don't hesitate to contact me again."

Clearly this was not the response I was looking for. Also, notice that this person clearly understands that I am trying to cancel my membership within a few days of the renewal. Should I have been more observant? Absolutely. As a previously paying customer of the company, however, I should not have had to send the following response:

"I am disappointed to hear of your inflexibility regarding cancelling or prorating my service with classmates.com when I contacted you within the 1st week of service. This is very poor business and a very risky move in a "Web 2.0" era. I will be filing a fraud grievence as this is a service that I only used since your company charged me to tell you not to charge me. Furthermore, this action on the part of your company is unethical and I will be certain to make certain that it is reported to the appropriate consumer advocacy groups. I am willing to work with you on this issue for a more equitable solution, but I do warn that there will be reprocussions should Classmates continue their current course of action regarding my membership fee. If you wish to speak with me personally regarding this issue, I may be reached either at my home at XXX-XXX-XXXX or XXX-XXX-XXXX. I highly recommend that you or your superior contact me within the next 24 hours to resolve this issue in a more palatable manner.

Thank you for your immediate response."

There response, which arrived in under thirty minutes was:

"Thank you for contacting Classmates. I can understand your frustration and will do my best to address your concerns.

Although we don’t want to lose you as a Gold member, because you clearly didn’t get the value you wanted from our site I’m happy to make an exception to our policy and process a refund.

A credit will be processed for you immediately. Based on your financial institution, please allow up to 30 days for the credit to appear on your statement.

You may continue to use the FREE membership benefits on our site

Thank you for contacting us so that we could take care of your concerns. We hope that you'll continue to come back to Classmates.com to reconnect with others.

If you have any further questions or concerns, please don't hesitate to contact me again."

Don't hold your breath.

Lesson: Common sense and customer service, even when your customers are taking their business elsewhere is paramount in this "Web 2.0" era. Your customers have the power to make or break your company. I have no doubt that the thought process behind the Classmates, cancellation/refund process is that a certain percentage of customers will just be angry and deal with it rather than to confront Classmates further, resulting in improved revenue for the company.

Don't be "Classless" in your business practices. The majority of your customers will be far happier with your ethical practices, which will far outweigh the relatively few that may try to take advantage of you.

Remember, the potential for bad publicity when your company initially refuses a refund can be far greater than $39.00.

Minding My Own Business is a blog written by Augustine Iacopelli. This blog consists of a mix of general business observations and contrarian positions on relevant topics as well my own forays in the world of business and networking.

To Facebook: "Don't Tase Me Man!"... What the handling of Beacon says about the Millennial Generation

Whew, what a title... But for business people, the current Facebook case is very interesting. The millennial generation (a.k.a. Generation-Y or Internet Generation) represents the future of businesses and is already shaping the face of business-to-consumer marketing.

Facebook, like MySpace and other social networks, thrives on the use of advertisers to keep their services free to their members. I have serious reservations on whether such networks would even exist were there a cost for usage.

When Facebook started pushing out Beacon, thousands of Facebook users were outraged.

"How dare they share our personal information!"

"What an invasion of privacy!"

Interestingly, these same millennial users seem all too happy to be more than open about what they were doing with their friend's girlfriend at 2 a.m. last Saturday and about what a jerk their boss is. Perhaps even more amusing is the ease in which members of this generation (which I am nearly on the cusp of myself) are willing to hand over their privacy for a free "app" in Facebook, opening themselves up to the data miners and target marketers of the world, just to turn their friends into "zombies."

So why the difference?

Simply put, people want you to ask them. Your loyal customers will go to the ends of the Earth for you, but you'd better not take them for granted. Mark Zuckerberg his team that runs Facebook have a more loyal fan base than most companies in existence. However, the Millennials are extremely fickle and, I suspect due to latent narcissism, must be overtly asked about any small thing that happens around them because, in their world, they ARE the center of the universe.

But then haven't we all been taught that we must treat our customers like they are our center of the universe? I doubt that Mr. Zuckerberg is anything but a bright guy, but it's apparent that he still has a lot to learn about consumer relations.

Minding My Own Business is a blog written by Augustine Iacopelli. This blog consists of a mix of general business observations and contrarian positions on relevant topics as well my own forays in the world of business and networking.

Lessons Learned: What Citibank Slipup May Mean for the Rest of Us

I awoke this morning to find out that I may be well advised to sell off some of my Citibank shares (grant it I don't own Citibank in any of my real portfolios) on the news that their revenue was likely to fall significantly in the 3rd quarter. The reason for the fall? The sub-prime mortgage market again.

While I don't wish any company any ill will, I believe Citibank's situation continues to accentuate 3 things.

1. Companies wishing to take a high risk, whether a major corporation, such as Citibank, or a small ma and pop shop down the street, must understand what their exit strategy is.
2. Companies need to understand where their stable operating platform is and take moves to maintain stability in order to limit dramatic drops in revenue.
3. When you develop an unethical product (pardon the soapbox here) eventually it will catch up to you and hurt your business in at least the short term, if not also the long term.

The attempts of sub-prime lending companies to put individuals into homes that they should have been smart enough (both the lenders and the buyers) to know that they could not afford, shows a particularly distasteful part of American business understanding. Americans today simply do not take the time to understand issues prior to making decisions and they further allow their televisions to cloud common sense. As business owners, employees, and consumers, it is essential that we are diligent in our pursuit of only ethical products and shun the unethical because it always catches up to us.