Earlier this week, I found a nice deal on white v-neck tees from Hanes.com on SlickDeals. I ordered a couple packs of t-shirts and some underwear. Unfortunately, a couple of days later, Hanes.com cancelled the shirts but shipped the underwear anyway. I wrote to Hanes Customer Service:
Hi, I saw the promotion on the V-Neck shirts and this is why I decided to order from Hanes.com. Because I was making the order from Hanes.com, I also decided to get some extra underwear that I didn’t really need but was convenient to add in due to the combined shipping. However, yesterday, I received an email saying that the t-shirts would be cancelled and only the underwear would be shipped. Can these t-shirts be placed on backorder and shipped later? Otherwise, this feels almost like a bait and switch to me, and I would prefer the order cancelled. I am being shipped the items that I didn’t necessarily need while the things I actually did need are being cancelled.
I wish I would have had the option to explicitly continue or cancel the order if I had known Hanes would do this beforehand.
After a couple of days, Hanes replied:
Hanes.com no longer offers the Hanes v-neck 3 pack undershirt on our website. The Hanes v-neck 3 pack undershirt style 1A0703 that you ordered was posted on links that are not legitimate offers by our company. Any questions you have on this offer will need to be address by the website that posted this link in error.
In response, I wrote:
Thank your for your complete lack of empathy, understanding, and willingness to help find a solution other than to blame customers for issues on your website. Now we know that any time other people promote your website and promotions via social media, customers should ignore that because Hanes is not responsible for the content on its website.
There is nothing that makes a customer feel more appreciated than being written a template reply.
I will make a note that I should never order from Hanes.com directly again and discuss the customer service issue on my website: http://www.ispithotfire.com/
As I discussed in the last email, what really aggravates me the most (and creates the most lasting negative impression of the Hanes company website) is the response via template email and complete ignorance of the issue that I discussed (cancelling my entire order as I really just wanted the shirts).
While Hanes claims that the product is no longer being sold (this was found via search, however) let’s assume this is true and that the product was never meant to be sold. First, in ecommerce, it’s very easy to mark an item as not purchasable. Second, despite this, let’s discuss what Hanes could have done to help its customers and create a positive solution out of this issue.
Don’t lie to or bullsh*t the customer. I believe that if you’re honest and make an attempt to assuage customers, good things will happen. Will everyone be happy? Of course not. By offering ways to save customers, however, you can retain customers who may become long-term customers.
I do likes Hanes products, and will use Hanes products in the future, but just not order directly. Does this mean that I won’t be penalizing Hanes? No. Hanes.com likely has specific sales targets independent of its 3rd party sales. Hanes.com would like to sell more items directly because the profit margins are much higher because it removes the middleman and it provides a customer base to learn from (gather customer data) and improves opportunities for future direct sales (customer lifetime value). If I buy Hanes shirts from Walmart, Walmart eats into those profits.
Thus, we can treat this situation as a marketing misstep. Hanes should have an expected customer acquisition budget, an amount they pay on average to acquire a new customer to their ecommerce site. Let’s say this is $5 per customer. I bought the t-shirt packs for $3.99 and lets say its retail price lists at $15.50, an $11.51 difference. Note that this is not the normal selling price nor is it the actual cost to Hanes. A similar pack is currently selling for $10.99, which is a $7 difference from the cancelled promotion price. If the customer acquisition is $5, Hanes will take a bit of a loss by selling the packs at the low price rather than not selling it at all.
Of course, there are other things to consider, such as negative PR impact by not allowing the sale, but let’s assume Hanes is uncomfortable will taking that loss. Besides, Hanes Marketing could be thinking, well, what if these customers are only here to buy this super cheap item and will never come back. That means we lose money for unprofitable customers.
In that case, Hanes could offer a new coupon to customers in this situation, a 25% off coupon for purchases over their normal average order size (what an average order brings in revenue). If that is $30, the coupon would be 25% off orders over $30. At 25%, Hanes would lose potentially more money (in profits, not necessarily losses), but could gain it back in sales volume. Customers would need to purchase a variety of products, potentially leading to better share of wallet and longer term product and brand loyalty (assuming the products are quality). People who only wanted to take advantage of the super cheap deal would be weeded out, leaving customers who really want Hanes products. There is some math that would need to be done based on Hanes’ actual profit margins, but you get the idea. The coupon needs to be significant where it fulfills both sides. Hanes needs to make a decent amount of sales from people who are serious customers. Customers need to be provided an offer that has real benefit and feels like a legitimate apology – for example, a 10% coupon would probably feel insignificant.
In the communication, Hanes would simply explain 1) we made a mistake, this was an error listing and we didn’t catch it 2) to apologize, we want to offer this exclusive coupon to you.
With over 100 people who explicitly said they participated (purchased) in the deal (I estimate the actual figure could be 3-5x more because typically, 80% of all users are passive), there would be a great opportunity to attract new users and also reverse negative sentiment created by this situation – look at the responses from other customers on SlickDeals (this is the most powerful potential impact by Customer Service teams, to not just be a cost center but to convert sales). Contrast this to the current situation in which Hanes is blaming customers for sharing links to Hanes.com via social media and promoting Hanes for free.
What do you think? What other ways could Hanes create a positive (and profitable) business impact in this situation?
(Edit: June 21, Julie Jenkins, Hanes.com Customer Service Manager contacted me and we found a resolution together on my individual issue. Thanks very much to her!)