AMAZON & AIRBNB – CONTRASTING ATTITUDES TO CUSTOMERS

AMAZON & AIRBNB – CONTRASTING ATTITUDES TO CUSTOMERS

Amazon has always had exceptional aspirations about customers, which marks it out from that of ninety-nine percent of companies, which if they are honest regard customers as a necessary evil – a damn nuisance, always expecting the earth, and not appreciating the niceties of company policies and procedures which sometimes get in the way of decent customer service.

“One thing I love about customers,” says Jeff Bezos, the founder and boss of Amazon, “is that they are divinely discontent.  Their expectations are never static – they go up.  It’s human nature.  We didn’t ascend from our hunter-gatherer days by being satisfied.  People have a voracious attitude for a better way, and yesterday’s ‘wow’ becomes today’s ‘ordinary’.  I see that cycle of improvement happening at a faster rate than ever before.”

Bezos has always hung his hat on the venerable idea that the customer is always right, and he’s always sought contemporary ways to give the idea real substance.  The way to stay ahead of ever-rising customer expectations which Bezos champions within Amazon is ‘high standards.’  Inculcating the highest standards of customer service, and putting customers first, is not optional within Amazon.  This does not always make for sweetness and light internally.

My favorite Bezos story is from the Christmas holidays in 2000, when demand was exploding, and the customer-service department was increasingly stretched by customer calls.  At a meeting of thirty senior executives, Bezos asked the head of customer service how long customers had to wait to get help.

“Well under a minute.”

“Really?” said Bezos. “Let’s see.”  He punched in the Amazon service number on the speakerphone.  Cheerful music.  Lots of it.  Bezos went red in the face waiting.  A vein in his forehead started to pulsate.  Tense silence in the room.  After four and a half minutes – which seemed an eternity – a cheerful voice trilled, “Hello, Amazon.com!”  Bezos then slammed down the phone and laid into the customer service boss.  He did not last long.

Anecdotes such as these have a way of proliferating within an organization, causing standards to rise precipitately.  More generally, Bezos has acted against the short-term financial interests of Amazon to provide extraordinary – and very cheap – customer service.  Amazon Prime is a case in point.  In the US it provides free shipping within two days on over 100,000,000 items.  When Prime was introduced, it cost Amazon serious money, and as it is extended to new countries, it still does.  It can only be justified in the long run, and only if enough customers use Amazon on enough products.  Providing excellent customer service becomes both self-fulfilling and absolutely necessary to reap the reward for Amazon – and if there is any slippage and customers become dissatisfied, the whole economics of the firm will go into reverse.

Another example is Amazon Marketplace, which allows small businesses to compete in supplying similar or previously-owned products.  The whole philosophy is that outsiders should be able to use the Amazon system to compete with Amazon.  Only if customers continue to buy more and more from Amazon over time can this possibly be justified financially.  Put the customer first and you will eventually benefit – that is the faith.  It sets the bar for customer service in the broadest sense higher and higher, and so it should.

The Contrast with Airbnb

The contrast with my experience of Airbnb last week could not be starker.  Now, don’t get me wrong.  I’ve always been a supporter of the Airbnb idea, which liberates unwanted space-time in properties and provides a superb alternative to traditional hotels and lodgings businesses.  More competition is always good and a dramatically simple new idea such as Airbnb is always to be welcomed.  I’ve used Airbnb many times and am already booked to use it again four times in the future.  The problem is, what happens when something goes wrong, and hosts mislead customers about what they are offering?  Then we see whether Airbnb is really on the side of customers, or just out to make money with the minimum level of customer service.

Eleven days ago, a friend and I arrived at an Airbnb for a nine-day stay at a property on the lovely Mediterranean island of Corsica.  The property was advertised as being an “entire house”.   The problem was that it wasn’t – it was in fact, a quarter of a house, one half of one floor of the house.  The garden and pool, prominently featured on the listing, were shared – while we were there a lady appeared to be making or packing jam and was wandering around the garden.  The host said that in French it did not say “entire house”, but he was wrong, and when we showed him the same thing in French he apologized and accepted that we could not stay there.

We immediately contacted Airbnb customer service, which was answered promptly.  The respondent was in Manila, which we thought odd, but promised that it would be sorted out quickly to our satisfaction.  My friend, who had contacted “Ricky” in the Philippines, said he was friendly and understood the urgency, and that I should not worry.  “Obviously,” my friend said, “Airbnb has to protect its brand and sort out problems such as this very quickly.”

They didn’t.  It took us four hours to find any available, even roughly acceptable, alternative, and we received no help from Airbnb in doing this.  The first property we found said it was available, but the host had not undated his availability calendar, so we back to square one.  Eventually we found a property that was rather expensive and did not have a pool, but was acceptable.  We had to pay again for this rental, but did so in the full expectation that Airbnb would give us a refund very quickly.

Again, they didn’t.  After promising that they would sort it out, and after spending a huge amount of time providing information – when all they really needed to verify was that a whole house had been promised, quite incorrectly – Ricky came back six days later to say that we wouldn’t get a full refund and should ourselves negotiate with the host for a partial refund – we might get half.  Part of the problem was that English was not Ricky’s first language, and his emails demonstrated that he had not grasped the essential point.

After spending further time and incurring a great deal of distress in the interim, we eventually were promised a full refund – but on inspection of the detail, this did not include a large element which represented Airbnb’s commission, sales tax, and cleaning.  We pointed out that there had been no sale and therefore that none of this was applicable.  Eventually we were promised a genuine 100% refund, but not for another 5-10 working days.  Our reasonable request for compensation was brushed aside.

This was an open-and-shut case; it should have been dealt with and compensated immediately.  Many people facing our problem would have needed the refund before being able to book other accommodation.  In our opinion, Airbnb let us down badly and displayed a mixture of incompetence, indifference to our plight, and – with the unseemly attempt to hang on to their commission – appalling greed.  It also seems that Airbnb is biased towards hosts rather than customers, which is bound to be self-defeating in the long run.

What Should Airbnb Do?

Perhaps this is an isolated lapse, and Airbnb’s customer service really is very good overall.  I would like to hear from readers who have had experience of Airbnb’s customer service, whether good or bad – and if you have friends who have had experiences, please encourage them to get in touch.

I would also be happy to furnish Airbnb’s management in San Francisco with all the details of this case, should they promise a full and fair investigation.  Let us see if they are interested, at a minimum, in damage limitation; and perhaps in changing their policies.

I have four suggestions:

  • That there is a customer service hotline providing complainants with someone at the other end who speaks their own language
  • That Airbnb takes on the responsibility of finding and suggesting alternative accommodation in the same area, if necessary providing emergency accommodation outside the Airbnb system
  • That Airbnb sets up a customer refund and compensation fund for immediate settlement of any liability in such egregious cases
  • That the Board of Airbnb, and especially its independent directors, commission an external evaluation of Airbnb’s customer service, its priority, and its service levels.

 What if Airbnb Does not Reform?

I sincerely hope that Airbnb will decide to emulate Amazon and side with its customers and not with hosts or – in the short term – shareholders.  But if Airbnb decides not to do this, it provides a golden opportunity for a competitor to do so.  The stakes are high.

That’s all for now, folks, but I suspect this is not the end of the story.

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