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.

Franchise: Opportunities for the Un-Creative!

Not sure what kind of business you'd like to start?

Want an investment that you have more control over than a security, but need a helping hand?

If so, a franchise may be right for you.

Here's some pros of running a franchise rather than your own "from scratch" business:

• Reduced risk of failure;
  
• proven methods and products;
  
• start-up help;
  
• ongoing training and support;
  
• local, regional and national advertising;
  
• collective buying power;
  
• research and development; and
  
• association and synergy with other franchisees.

Unfortunately, for the many advantages of franchise ownership, there are some costs that you don't see with your from scratch business plan:

• Royalty and other fees,
  
• smaller profit margins,
  
• lack of independence and freedom, and
  
• a franchisor's problem may become your problem

Source: International Franchise Association

For more helpful information about starting a franchise, visit franchise.com.

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.

MMOB Classic - Web Site Maintenance Etiquette

Note: Minding My Own Business publishes at knowmybusiness.blogspot.com on Monday's and Wednesday's. While I am in the process of migrating fully to this new home, I will fill in non MMOB days with my blog entries previously posted on my MySpace blog page.

Problems with routine web site maintenance were brought to my attention twice over the past week by students, while I was working at Wichita State. I felt this was a relevant topic to discuss as nearly every business today has a web site.

I believe that there are 3 major issues that must be taken into account and are often not handled well by web designers and technology specialists in organizations.

1. Keep in mind upcoming events relevant to your business.

One problem brought to my attention was regarding access to our web registration site. Early each semester, students frequently utilize this site for adding or dropping classes from their schedules. Wichita State's tuition and fees office schedules deadlines for partial refunds of tuition payments. These deadlines are very tight and stringent for students, particularly those students who meet near the deadline to drop with a refund. Some of our WSU students had only two hours after their first class meeting to drop with a full refund. Unfortunately for these students, the university's routine scheduled maintenance was going on from the time the students' classes began until the deadline for the students to drop with a full refund. This prevented students from dropping their classes at the last minute and effectively changed the deadline from what students had been originally told. Fortunately, this problem did not impact many of our customers; however it reflected a lack of foresight, which can serve to damage the goodwill of the university.

In most businesses, there are peak times of consumer interest in their product lines (alcohol and greeting card industries are first in my mind) that they need to be mindful of when scheduling routine maintenance. Avoid website updates that will interrupt consumer access at all cost during these times.

2. Do not keep a regular schedule for site updates.

This seems counterproductive and contrarian to common sense regarding web updates. However, we do not know when our customers or potential future clients will access our company web site for information. As an example, another student was attempting to access a non-WSU managed web site for a university course assignment on a weekend morning, when technology support can sometimes be in short supply. The student was unable to complete his assignment because the site was down at the time. He mentioned that this was the time that he intended to be doing his homework during the week. However, the maintenance schedule for this particular web site is such that he must always alter his own schedule to accommodate the schedule of the company.

The business world no longer operates 8 a.m. to 5 p.m., Monday through Friday in an Internet age. Be aware that some of your clientele may only have limited after-hours to access your information. By rotating your routine down time and notifying customers in advance of website maintenance, you will maximize the likelihood that all your clients will be able to have access to your web presence at some point and will not always be inconvenienced when attempting to access your web page.

3. Consider using a mirror site during site updates.

While more expensive, utilizing a redirect off your main web site to a secondary site, while your main web site is under maintenance may be a viable alternative depending on the features that are being updated. For example, if a web site needs to update its storefront, but not the features that critical to the shopping process, it does not make sense to completely shut down the web page to make such a change to the site. In this case, a redirect to a secondary store might be adequate while the update to the main store is taking place. It takes much less effort to go to a competitor's web site to purchase a good than to wait for your site to become available again. In addition, by having a mirror site at the ready your company is able to move operations quickly to your mirror location, should your web site become compromised by hackers or web hosting problems.

Web site down time happens. How a company handles their down time and plans ahead for contingencies in the case of unexpected problems may be the difference between a sale or satisfied customer and lost revenue or at least lost goodwill for your company.

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.