A few days ago, I called my auto insurance company to pay my semi-annual bill. I usually send in my payments through online banking (a very convenient, free service with my bank), but this time I had been traveling a lot and was too close to the due date to do that. I had my credit card ready with me, but they wouldn't take it. They wanted a check-over-the-phone thing. I didn't have my checkbook with me (who uses checks today anyway?). How much more expensive would it be, for a company that size, to accept credit card payments online and over the phone? A small percentage, plus the setup, training and maintenances fees, minus the cost of processing checks from the people that actually use the credit card instead, minus the cost of handling the (first and) second call(s) (read ahead).
Although I don't think it is necessary, nor a good strategy for them, I would still be happy to (at least) have the option to pay a small extra fee for the convenience of using my credit card. How many clients change companies because of them being so restrictive (and cheap) at the time of accepting payments? Don't force your loyal clients to search for alternatives! Even if you are cheaper, most unhappy clients will be happy to move and pay more for a better service!
So, anyway, I called the following day with my checkbook in hand. This time, their routine was different. Unless they changed the process somewhere in between those two days, their guys were being pretty inconsistent (another expense to them). This time, they went through all possible discounts I could get, trying to lower my premium before I payed. I liked that. But the funny thing is, they got me a $2 annual discount because I am now parking my car in a covered garage.
A few days later I get my policy update in the mail (about 10 printed pages -in a kind of cheap paper-, inside a big envelope), indicating the new discount. The policy was good until next year, so they only had to send a new one because of the discount itself, not because of the payment. They never asked me if they could e-mail me that instead (not sure if that would be legal though). Oh, and yes, also their website looks like a big mess promoting all their services and products (instead of helping you get done fast with what you want). Now let's think about all this for a second...
What's the point of giving me a 0.25% discount when they had to pay for two calls (instead of just one, or zero if they would be really online), each of them about 4 to 5 minutes long to process my payment, plus the costs of printing, packaging and shipping the updated policy? What about my time? Am I happy with their service? No. Is the discount going to change my mind? No way! I'd rather have them streamline their website and processes so that they can save on unnecessary administrative burden, be more efficient, and use that to cover for the added costs (*) of accepting credit card payments and improving service level --and retain more customers (*).
To be fair though, they did get something right. The phone answering machine menu was very fast and there was a human answering the phone right after the first few seconds. So they are not that bad after all.
