Palm responds, Part 2

This is part two of a dis­cus­sion with John Moses, Vice Pres­i­dent of Cus­tomer Rela­tions World­wide at Palm Com­put­ing. This dis­cus­sion was held over email as a result of a recent issue I had with the Palm call cen­ter. Part 1 of the dis­cus­sion looked at Palm’s call cen­ters. In this sec­ond part, we look at the Unit Replace­ment Pro­gram offered by Palm.

As was the case for the pre­vi­ous part, I have only edited the con­tent for for­mat­ting sake.

Q: Let’s switch gear to the unit replace­ment pro­gram: The Palm web­site seems to have dif­fi­cul­ties rec­og­niz­ing exist­ing accounts. Part of the frus­tra­tion of my own expe­ri­ence was that, hav­ing bought a device from the Palm web­site in early 2007, I was unable to get to the infor­ma­tion online because the site did not rec­og­nize the email address I used to reg­is­ter (even though I have some emails sent by palm to that email address). This resulted in my being unable to get the exact date of my pur­chase. When I talked to the cus­tomer ser­vice rep­re­sen­ta­tive, I was told that we could not move for­ward with any replace­ment with­out that infor­ma­tion. Con­sid­er­ing the device hadn’t been in the mar­ket­place for a year, I thought that it would be con­sid­ered under war­ranty no mat­ter what. Why is it that cus­tomers still need to pro­vide a pur­chase date for devices that are less than a year old?

A: They shouldn’t have to, you are right. Unfor­tu­nately, since we pri­mar­ily sell through the car­rier chan­nel, deter­mi­na­tion of an in-warranty vs. out-of-warranty device is not a per­fect sci­ence. Our prac­tice is to sys­tem­at­i­cally derive the pur­chase date from the man­u­fac­ture date, based on the ser­ial number.

We have very reli­able data on how long a prod­uct takes to move through dis­tri­b­u­tion and sales chan­nels that helps us ensure we offer all of our cus­tomers a min­i­mum of 12 month war­ranty, as stated in our con­tract with the cus­tomer (i.e. the war­ranty). If an agent believes the prod­uct may fall out­side of the 12 month period, we request proof-of-purchase (POP), which is not unusual in the con­sumer elec­tron­ics indus­try. That being said, an agent must use their best judg­ment and always han­dle these dis­cus­sions in a pro­fes­sional and cour­te­ous man­ner with the customer.

To bet­ter serve our cus­tomers, we’re cur­rently explor­ing insti­tut­ing a pol­icy that will not require agents to check pur­chase dates for prod­ucts that have been newly released (i.e. less than a year old). This should help elim­i­nate unnec­es­sary ques­tion­ing and allow our agents to pro­ceed directly to get­ting a customer’s issue resolved.

Q: If cus­tomers are not able to sup­ply a date, why is it that there is no way for a call cen­ter oper­a­tor to look up infor­ma­tion for devices bought from Palm’s online store?

A: We do aspire to have all of our cus­tomers’ trans­ac­tional infor­ma­tion avail­able to our ser­vice agents. How­ever, this is not the case for a vari­ety of rea­sons. First, there is some infor­ma­tion that will never be avail­able or kept; car­rier sales infor­ma­tion and infor­ma­tion pro­tected by pri­vacy laws, for instance. But, for the rest, specif­i­cally any trans­ac­tional infor­ma­tion Palm is exposed to and legally able to main­tain, we are mak­ing huge invest­ments in a CRM pro­gram that is bring­ing this infor­ma­tion all together in a mas­ter cus­tomer data­base. Just this past year, we inte­grated most of our direct sales trans­ac­tions (e.g. from our online store) into our ser­vice appli­ca­tion, load­ing both cus­tomers and assets. As for Tristan’s case, unfor­tu­nately the pur­chase last win­ter was prior to this inte­gra­tion going into effect, so the pur­chase record was not there.

Q: Forced to sup­ply a date, I gave a date at ran­dom in order to push the call fur­ther. I was then told that it was the exact date of my pur­chase (a dubi­ous claim at best since the date hap­pened to be, after I checked, before the date of the press release announc­ing the release of the Treo 680). When I con­tested the pos­si­bil­ity of this being the date at a later time, I was told that you are track­ing devices dates by ser­ial num­bers. If that’s the case, why is that infor­ma­tion not being used ini­tially? (It’s gen­er­ally eas­ier to find a device’s ser­ial num­ber than its pur­chase date since the ser­ial num­ber (and inci­den­tally, IMEI) is on the device)

A: I sus­pect that in this case, and what is prob­a­bly rou­tine behav­ior by agents, is to request the date of pur­chase from the cus­tomer, and to take their word for it — which is the proper thing to do. Now when a cus­tomer is not con­fi­dent about the pur­chase date or does not have any rec­ol­lec­tion, then an agent is going to check out the ser­ial num­ber to get a good idea of the pur­chase tim­ing — it’s only then that we are going to call into ques­tion the war­ranty, and per­haps seek proof of purchase.

Q: Ven­dors like Apple and RIM track their device pur­chase date by IMEI. Why isn’t Palm doing the same? And if it is, why isn’t that infor­ma­tion avail­able to call cen­ter personnel?

A: IMEI and ESN are two indus­try rel­e­vant codes for mobile devices. The ser­ial num­ber is a Palm-specific num­ber gen­er­ated at time of man­u­fac­ture. Because it is con­sis­tent across all Palm prod­ucts — where it is not for IMEI and ESN — we tend to rely on ser­ial num­bers as our default track­ing method.

Q: The retail price for an unlocked Treo 680 is $379, the street price for an unlocked Treo 680 is around $250. In either of those cases, the device would come with a one year war­ranty. The replace­ment price for a Treo 680 is $199. Why is the replace­ment price so high?

A: The pri­mary dri­vers of repair and replace­ment cost are parts and labor, and hence can’t be directly com­pared to the prod­uct. The wire­less indus­try sub­si­dizes phone pur­chase prices, mak­ing the total cost much lower than the actual cost of hard­ware and labor.

Q: Look­ing at the prices listed on your site, it appears that all your phones have the same replace­ment price ($169 by web, $199 by phone) How­ever, prices for the unlocked devices listed in the Palm store range from $379 (for an unlocked Treo 680) to $669 (for an All­tel Treo 700p). Does that mean that the repair cost for all units is the same? Why isn’t there vari­able pric­ing on the repair costs?

A: The actual cost of repair may vary across units, but this vari­ance is much less than you’d think. The process steps that all units go through for diag­nos­tics, com­po­nent replace­ment, cos­metic refur­bish­ment, and logis­tics are iden­ti­cal. The only real dif­fer­ence is the value of the parts required for a given repair.

While vari­able pric­ing seems like the best thing for the cus­tomer, we actu­ally pro­vide fixed pric­ing to deliver a bet­ter cus­tomer expe­ri­ence. This is because we want to quote a price upfront and quickly process the replace­ment with­out hav­ing to come back to the cus­tomer and explain that their fix was dif­fer­ent or more costly than what was expected at the out­set. This would cre­ate unnec­es­sary ten­sion and delays when a cus­tomer needs their phone back to them in work­ing order as soon as pos­si­ble. We don’t really know what parts will be required until we open the device, and a call cen­ter agent would not be able to accu­rately esti­mate the costs.

Q: A year ago, the replace­ment cost for a Palm 600 was $100 (I unfor­tu­nately broke 4 screens on Palm 600s through the years so I’m famil­iar with that price). Today, such a replace­ment would cost $169. Why the price increase?

A: As prod­ucts get older, our cost to ser­vice that prod­uct nor­mally increases. It reflects the grow­ing cost of acquir­ing parts, main­tain­ing inven­tory, exper­tise and train­ing for repair events that become more and more infrequent.

Q: Apple has made it a prac­tice to sell spe­cial con­tracts (called Apple­Care) on their devices that pro­vide extended war­ranty. This includes sell­ing Apple­Care for iPhones (for $69). The pro­gram includes replace­ment of defec­tive units at no extra charge and extends war­ranty from 1 year to 2 years. Why isn’t Palm offer­ing a sim­i­lar program?

A: With the first line of smart­phone prod­uct sup­port at mul­ti­ple car­ri­ers, includ­ing war­ranty pro­cess­ing, an extended war­ranty pro­gram has been a chal­lenge for Palm to offer — mostly because of chan­nel com­plex­i­ties. We are presently work­ing through the chal­lenges that have made this dif­fi­cult, and hope to offer this ser­vice fea­ture to our smart­phone con­sumers in the future.

Apple has a unique rela­tion­ship with AT&T that may make these pro­grams a bit eas­ier to provide.