By Gery L. Deer
Deer In Headlines
In November of 2011, a consumer backlash led Bank of America to scrap plans for a monthly, $5 fee levied on all debit card users. Customers took to social media like Facebook and Twitter, berating the company for punishing the middle class with nickel and dime fees.
On average, the lower and middle classes are the largest group of debit card users. But what if another company, seeing the tremendous amount of free media attention bestowed on Bank of America, decided to try the same thing?
In December, Verizon Wireless attempted to stick customers with a $2 fee for paying bills either online or by telephone. Most experts agree that these services are used primarily by those who either pay at the last minute or late. According to Bloomberg writer Alex Sherman in a January 1st story, Verizon, “It would add the fee to address costs it incurs for processing the single payments.”
Within moments of the announcement, however, customers began railing against the proposal through social media and online discussion boards. By December 30th, less than 72 hours after the fee announcement was released, Verizon Wireless, the largest cellular wireless carrier in the United States, scrapped the entire plan.
In a public statement, Dan Mead, chief executive officer of Verizon Wireless said, “The best path forward is to encourage customers to take advantage of the best and most efficient options, eliminating the need to institute the fee at this time.”
It should be noted that Verizon Communications, one of two parent firms that owns the wireless giant, experienced 12 percent growth over the last year. The company employees more than 83,000 workers nationwide and services approximately 90 million customers.
The consistently volatile economy has made consumers more sensitive to overcharging, particularly by major corporations. Based on what happened with Bank of America, it’s hard to imagine that Verizon executives wouldn’t have predicted a similar, overwhelmingly negative response? Or maybe that was their plan all along.
While no evidence exists to support such a statement, there are those who are speculating that the fee and its subsequent elimination were little more than a publicity stunt. Theorists imagine that Verizon executives and marketing wizards were inspired by the staggering amount of free media coverage Bank of America as a result of the ATM fee debacle.
Where Bank of America was concerned, it’s unlikely that executives were concerned about losing customers. Sitting atop an industry that already had its share of bad press and facing legal troubles over bad mortgages, it’s far more likely the financial behemoth backed down to minimize the amount of negative attention they were getting. In this case, bad press was only making things worse.
Similarly, under attack for excessive and often hidden fees, Verizon has been getting some equally bad press. But they may have decided to see if they could make the negative media work to their benefit by creating a situation wherein they would end up the good guys. It’s possible they may have even initiated the aggressive social media barrage on their own accord just to prime the proverbial pump and get people talking about it.
Going on the old adage, “there’s no such thing as bad publicity,” the company might never have intended to charge the fee in the first place – unless no one complained. If that had happened, they could simply apply the fee where stated, rake in millions in extra revenue, and maintain business as usual with the public none the wiser. They really couldn’t lose either way.
Could the stunt have cost them customers? Maybe, but the number would have been insignificant compared to the amount of free, national media coverage that, in the end, painted a bright, sunny picture of a big corporation that listened to the little people.
Consumers need to be smarter than to think a multi-billion-dollar corporation is really going to be so responsive, regardless of how many people Tweet about them. They are all in the business to make money and as long as they have what the buying public needs, they will continue to do so, unfair fees and all.
Gery L. Deer is an independent columnist based in Jamestown. More information available at http://www.gerydeer.com.