Most of us have cellphone, pay-TV and credit card bills, but few of us realize that simply calling companies and asking for a better deal can save a substantial amount on those bills.
“Many times customer reps are empowered to provide you with something,” says Tony Giorgianni, a money advisor with Consumer Reports. “It costs companies five times as much to acquire a new customer than it does to keep an old one.”
So, it is a factored-in cost of doing business to provide discounts or other incentives for customers who call and ask. Companies know that most customers won’t ask, so it’s a small price to pay to hang onto those who do.
In fact, a recent survey by CreditCards.com found that only 23 percent of credit card customers called to ask for better terms. But, when they did, most got better interest rates or waived late fees.
Matt Schulz, a senior analyst with CreditCards.com, says even he was surprised by the survey’s findings. So he understands that most customers don’t realize they have the power to get better deals.
“And that’s kind of understandable. Given that in the depths of the recession, all we saw in the headlines was credit limits being slashed and accounts being closed and all that sort of thing,” Schulz says, adding that banks are competing for customers again, as the economy recovers.
Consumer Reports’ Giorgianni points out that consumers have leverage in any industry where there’s competition.
Elizabeth Coffman, a college professor in Chicago, found out the power of the call recently when looking for a better price on her cellphone plan. She has a family plan with several cellphones on it at a price of $300 a month.
“We have called both the cable company and the cellphone company, because our charges were too high, and said we were going to go to another company if we couldn’t lower them. In both cases we were successful,” Coffman says.
But, it has been a while, and she decided to contact her cellphone company again, just as other carriers were offering discounts and incentives to win over customers. The result: a more than $100 per month price reduction, saving her more than $1,200 a year.
Carol Helton of Cape Coral, Florida had a similar story with her cable company. About six months ago, she called her cable company to complain about raised fees.
“I mentioned that I keep getting mailers from their competition and I was thinking about switching. They put me through to their ‘retention specialist.’ Not only was she able to take off the new charges, she was able to give us a lower rate than we had been paying,” Helton wrote in response to a Marketplace questionnaire on the Public Insight Network.
Sometimes, success isn’t immediate. Sharon Forrest of Atlanta, Georgia, says she called her phone company three times and had to wait for her bill to increase, before she could get them to reduce her payments.
“I learned not to take for granted that the company will make the changes they promise. I learned to persist,” Forrest wrote.
Giorgianni says persistence is important. If you call and don’t get the answer you want from a customer service representative, hang up and call again later. A different representative might be more helpful, or might know of a deal or promotion that the first one didn’t.
Most importantly, Giorgianni says, remain happy and positive. If a company thinks they still have a way of keeping you a happy customer, then they’ll try to do so. But if they think you’re so angry that they’ve already lost you, they’ll have little incentive to try.
Marketplace is on a mission.
We believe Main Street matters as much as Wall Street, economic news is made relevant and real through human stories, and a touch of humor helps enliven topics you might typically find…well, dull.
Through the signature style that only Marketplace can deliver, we’re on a mission to raise the economic intelligence of the country—but we don’t do it alone. We count on listeners and readers like you to keep this public service free and accessible to all. Will you become a partner in our mission today?