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Corvillus

join:2006-07-02
Windsor, ON
reply to dillyhammer

Re: "Undesirable" customers: Cogeco, Audet

said by dillyhammer:

said by cablesmurfet :

What Cogeco is trying to do by tightening credit restrictions is eliminate "promotion hoppers". These are the people who switch every few months. Some of these people don't pay their billls, and are forced to switch. No provider makes money from them. They will be weeded out at the beginning. Cogeco wants to establish a more stable custoemr base. They figure that the good customers will stick around for a long time. They are the ones who make companies money.

Tightening credit restrictions will not eliminate "promotion hoppers".

Tightening credit restrictions will eliminate people with bad credit. Some of them don't pay their bills. Some people with good credit don't pay their bills. Some millionnaires don't pay their bills. This is called churn.

The best way to prevent promo hopping (and any other form of churn for that matter) is to offer top notch services at really good prices. In other words... NOT COGECO.

They're bleeding customers because a) TPIA just kicked in, a b) their services are lacking and their prices are absurd.

Not. Rocket. Science.

Audet is full of shit. Plain and simple.

Mike

I would go so far as to say that if anything this will INCREASE "promotion hopping" (or "demon customer" percentage as Best Buy likes to call it). People with better credit have a higher tendency to actually pay attention to the terms of the contracts they are signing, and to read the fine print of what they are buying, examining for any possible loopholes they can exploit in them.

As such, they're more likely to look at whether or not it is a promo rate, and how best to get out and line themselves up with the next competitor with a promo rate, as soon as possible after the promo rate is done.

A customer with bad credit on the other hand, assuming they pay their bill at all, will probably not pay as much attention to the terms, and may not notice or care what their bill is when the increase does happen (and thus, blindly pay the "standard rate", much like how people with poor credit pay the "minimum payment' on their credit card debts even though it's spelled out in plain english how much it will cost them these days).