At lots of high-growth tech startups, customer service is dramatically outpaced by customer growth and it is almost impossible to get help as a customer.
An example of this from my own life is my girlfriend trying to get help from Coinbase over the past four months. They told her that they would be resolving her issue in “the next two weeks” in January and now, four months later, it is still not resolved.
During the fall and the run-up of the price of Bitcoin, Coinbase was the most popular app on the app store and added millions of users. There is no way they could add customer support in line with that growth, so as a result, they have awful customer service.
The most effective way to allocate that scarce customer service would be to put a price on it. But, we live in a world where there is an expectation of customer service and as a result, companies are terrified to charge for it.
The best way for Coinbase to actually help their customers would be to price access to customer service so that the people who value it the most are able to pay the price necessary to get it. This would allow the most valuable cases to get solved first, and push out the distraction and wasted time of cases that are not worth much to solve at all.
Amanda would happily pay to have this situation resolved, but unfortunately this is not an option because Coinbase, like most companies are afraid of the irrational, economically illiterate mob.
The Uber Example
This mob of dummies hurts us in many other ways. Take Uber for example.
One of the innovations that made Uber great was dynamic (surge) pricing that incentivized more drivers to drive at the busiest times in the busiest areas.
But the mob of dummies attacked Uber and Lyft for surge pricing. The took out their pitchforks and wrote Vox articles declaring that Uber was exploiting customers. Both reeled back and limited how dynamic pricing works and as a result, made their services worse.
As a profit-maximizing bet Uber and Coinbase may not be wrong in the short and medium-term. The negative press that came from surge pricing, or would come from charging for customer service would certainly be bad for business in the short and medium-term, but choosing to follow an irrational mob will never get you anywhere good in the long-term.
Giving in to the demands of the economically illiterate lynch mob of non-customers means that you do a worse job of serving your actual customers, and they will eventually find a business that puts them in front of public opinion.
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