On following the herd

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I don’t like unions. In fact, I have a viscerally negative reaction to them. This isn’t based on politics. It’s not based on macroeconomics. I also have a viscerally negative reaction to both politics and macroeconomics. This is based on the simple fact that a union is, by definition, an organization that is designed to force management to treat employees not as individuals, but as cogs in a machine. 

 

If you are a member of a union, you are paid based on the rules that the union drew up with management. A bunch of guys in bad suits met with a bunch of guys in overpriced suits met with a bunch of lawyers (who, generally speaking, I don’t consider as people), and they hashed out a set of terms that dictate how you, as an individual employee, will be paid and treated at the workplace.

In an industrial, company-town society, this is a good thing. Upton Sinclair was not writing in 2013. Eastern European immigrants to Chicago in the early 20th century needed unions. I applaud the work that they did. It’s different in 2013. 

As an individual working in an industrial society, you are an easily replaceable cog in a giant machine. As an individual, you do not have the freedom to choose between different employers, because you cannot leave your hometown—transportation options are expensive and infeasible.

 

The post-industrial society is based on competition and specialization. As an employee—even at the entry-level—there are a multitude of potential employers that I can choose from. For those with very limited skills, the options are more limited, but they aren’t non-existent. North Dakota has 1.9% unemployment. The bus ticket from Chicago to Williston is $90. Everyone has options. Sometimes the options are all relatively crappy, but that doesn’t mean that they are all equally crappy.

 

Companies compete to attract the most productive employees and the most profitable customers. For the 95% of people who stick to the script—not effectively negotiating salary, not bargaining, not shopping around, not researching potential alternatives—companies profit off of offering the cheapest possible option at the highest possible price. If I am Nike, I make my $250 sneakers in Bangladesh using $4/day contract labor because I can and because I know my customers will pay. 

 

The cultural norms of society lead us to choose things, by default, that often run counter to rational decision-making. In the mortgage crisis, people who were making basically nothing were buying houses that were overvalued by a factor of two, just because they had this idea in their head that they had to purchase the biggest possible house for the most money that their mortgage officer would allow.

Today, we see an explosion in college costs as young people are duped into believing that a four-year degree is the only way to a middle-class life. We see people actually believe that they have to take four (or five or six) years to get that degree.

When you accept what seems to be at face value, you are signing yourself up for mediocrity. When you look at the way that the world was, and you assume that the world will remain stagnant, you set yourself up to be rudely awakened.

America faces massive challenges because we fail to recognize that the unseen can be just as powerful—if not more so—than the seen. We take what is, and we don’t stop to consider what could be.

In 2013, I’ve spent eight nights in hotels, taken two first-class & two coach flights, skied in Park City, partied in Boston, pub crawled in Greenville, S.C., and spent time at an Irish bar in Queens. I’ve driven over 1,200 miles in a rental car, flown over 4,000, and ridden 400 in a bus. Tomorrow, I’m headed to New York to reconnect with a cousin I haven’t seen since 2006.

On January 1st, I didn’t have any of that planned, booked, or paid for.

The perception is that travel is expensive, time-consuming, and an all-around big hassle. The reality reflects none of the above.

If I wanted to do my Utah trip using the “normal” path, here’s what I would have done: 1) looked at airfares; 2) decided not to go.

Unfortunately, a lot of people get to step one, and assume that because airfares to their pre-determined location on their pre-determined date at their pre-determined times from their pre-determined airports are expensive, than ipsofacto, TRAVEL IS SO EXPENSIVE THAT I CAN NEVER GO ANYWHERE.

Another “real-world” example is the following: people all across America are unemployed because they are looking for a pre-determined position in a pre-determined industry in a pre-determined location at a pre-determined salary. Oh, and by the way, they expect that if they submit their unedited and untested resume through a website, magically, a job should rain down from the sky.

The people who succeed in the real-world understand that life is not that simple. You have to go through the backdoor, using your experience, connections, and professional relationships to get access to the opportunities that are shut out from the riff-raff.

In travel, the people who go lots of places for minimal cash money understand that you have to hack the system to do it. You have to exploit the fact that most people are lazy and ignorant to take advantage of programs that were built to pray on the weak.

The best way to do this is to take the credit-card game, which traps millions of people in serious debt without rewarding them, and use it to your advantage.

Sixty percent of credit card holders carry a balance. These people pay interest ranging from 13 to 25%, on an annualized basis, for the privilege of buying things that they can’t afford. Over time, these people end up padding the pockets of the credit card issuers.

Because of the poor decision-making of the people who don’t pay their bills in full, credit card companies make it incredibly rewarding for responsible people to use their product. Every single dollar I spent (with the exception of D.C. cabs & my utility bill) is paid on a credit card…even my rent, which I transfer directly to my roommate—without a fee—using Amazon Payments. He then pays our landlord with a good ol’ fashioned check.

 

In exchange for using plastic, I get reward points for every dollar that I spent. On my AmEx Platinum, I get AmEx Rewards points, which transfer to hotel & airline programs or can be spent directly on travel. On my Starwood Preferred AmEx, I get Starwood points. On my AA Citi card, I get AA miles. Etc, etc.

That’s great, but one measly point per dollar is not that good. It takes 25,000 AA miles to book a roundtrip reward.

The average person sees credit cards in one of two ways: 1) an opportunity to spend money that they don’t have; 2) an opportunity to pay without using cash.

These are the people who make money for the credit card company. These are the people whose ignorance feeds the profit engine of the banks as well as Mastercard, Visa, and American Express.

The jetsetter, on the other hand, gets between 10-20 credit cards per year, using them to generate huge sign-up bonuses that fuel free travel.

In September I got the Citi Hilton Reserve Visa card, which comes with automatic Hilton Gold (normally requires 25 stays at Hilton properties) and two free Hilton nights.

The Average Joe gets that card, and they use their free nights on an already pre-planned vacation at a $150/night run-of-the-mill Hilton (yes, I consider Hilton hotels run-of-the-mill). That’s a $300 return on investment, minus the $95 annual fee. Not terrible. The Average Joe then continues to keep spending on the card, even after the $3,000 in 3 month minimum spend requirement is met. The Average Joe uses the new card as their primary card for two or three years, paying $95/year for the privilege of earning (what are now basically worthless) Hilton points.

On the other hand, I got that card, put three months of rent, cable, and cell phone bills on it, and used my two free nights at one of the most expensive Hilton-family properties in the U.S. While I did have to pay a $95 annual fee, I got two nights in a hotel room at the Waldorf-Astoria Park City that would have cost me $2,000 out of pocket.

Likewise, I booked my flights to Salt Lake City using American Airlines points that I got almost entirely from a credit card sign-up.

While the peasants of the world fly Southwest, I was with my dad in first class on American. And, using the free lounge access that I get through my American Express Platinum card, I didn’t even have to sit in the dirty gate area.

To do all of these things, you have to challenge a number of assumptions:

  1. Credit cards will kill your credit score—False! You take a 3-5 point three month ding for each sign-up, but the extra credit that you get actually helps your score, in the long term.
  2. You have to have a long credit history to get credit cards—False! While it’s nothing like the pre-Dodd-Frank days of instant approval for anyone with a Social Security number and a pulse, you don’t have to have decades of credit and make $100k+ to get top credit cards.
  3. Credit cards make it more difficult to budget, because you can spend money you don’t have—False! Credit cards make it easier to budget because they automatically track your spending. Using an app like Mint.com, you can instantly view, track, and categorize your spending. You can set spending limits on your cards, or use a charge card (like an American Express Platinum or Gold) if you are really worried about spending too much.

In the quest to give financial advice to the lowest-common denominator of society, popular figures tend to assume that you are a complete idiot. They assume that if you get a credit card, you will immediately go out and buy 20 flat-screen TVs, just for the F of it. If you are reading this blog, you’re not that stupid. A lot of people are, however, so take the “popular” advice with a bag of salt.

Ultimately, you only have to take one look at “Middle America” to know that you deserve better than that. But it’s not enough to simply sit around and daydream about a better life. You have to take concrete steps to make it happen. The good news is that it is a lot easier to travel around the world for free than it is to identify, develop, and hone a set of specialized skills that will make you a member of the 1%. And, it’s much easier to sign up for credit cards than it is to go back and time to get adopted by Angelina Jolie and Brad Pitt.

So, here’s my “wrap-it-all-up” advice:

  1. Go to creditsesame.com and check your credit score (No, I don’t get referral credit if you do).
  • Find out why you have the score that you do. Is it low because you have very little credit history?
    • If so, apply for a basic, no-frills credit card. Pay off your balance on-time, every month for six to nine months.
    • When your credit score hits the magic 725, start getting into the credit card game, for real.
  • Is your credit score low because you missed a payment?
    • Don’t do that again.
    • Call your credit card company and find out if you can have that ding wiped from your report. Generally speaking, your first missed payment shouldn’t count against your credit score.  
  • Is your credit score low because you have a lot of debt?
    • Pay it off.
    • Sign up for Mint.com, and rigorously track every dollar that you spend.
    • Do you have major loans (student, car, or mortgage)? Stop spending money on garbage and start paying off the loan that has the highest interest rate.

2. Think about your travel priorities and your willingness to spend time tracking credit cards.

  • Traveling without having to pay out-of-pocket money is great, but it’s not exactly free (despite what I say all-the-time on this blog). It takes time and attention to detail to ensure that you get the right credit cards, meet the requirements, and pay them off.  Are you willing to spend an hour every three months to sign up for credit cards? Are you willing to be flexible and spend time researching reward redemptions?
  • Think about whether you value international travel or domestic travel. Do you take one mega-vacation per year, or are you more of a weekend warrior (I know I am)? Do you want to save money? Do you want to be able to cash in on one-in-a-lifetime rewards?

3. Go out and do it!

Editor’s note: I apologize for not including 30,000 links in this post. Normally, I would take the time to come up with an excuse for not having the time to put in a bunch of links. I’m not going to do that today. There is a wonderful website called Google that can direct you to any of the topics discussed here. If you can’t find the answer on Google, I apologize for nothing. 

I am the 1%. At least, that’s what I want them to think.

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The best way to save money is to pretend like you have a lot of it. That is the lesson I’ve learned over the last year, as I have stepped up my travel game.

First class breakfast. I didn't pay a dime for the flight.

First class breakfast. I didn’t pay a dime for the flight.

When a company thinks that you have no money, it will treat you like you have no money. People who have no money are capable of delivering no profit to a company, and they are highly price-conscious, which makes them a pain to deal with. They also tend to not have the resources to afford to be loyal to a particular brand. These people don’t put brand first; they don’t travel enough to be loyal to one company.

As a person who lives in an expensive city on an entry-level salary, my financial goals are two-fold: 1) keeping my fixed costs as low as possible; 2) stretching my disposable income as much as possible.

The basic way to do this is simple. The advanced strategy can get super complicated. I’m going to stick to the basics today, and I’ll cover advanced stuff as the weeks go on.

Authenticity does not exist. Stop using it as an excuse to not get what you want.

My first lesson in upgrade-ology came when I was in Nashville five or six years ago.  My mom, who was a legitimate journalist at the time, asked the Hotel for a media rate. She said she was doing a piece on Nashville and would also like to see the meeting facilities.

She got 40% off their best rate, we got a baller room, and she spent a grand total of 15 minutes talking to their meeting staff about the hotel. Bam! #UpgradeWin

In this situation, she leveraged her status as a journalist to save money and improve the quality of the stay. She did nothing illegal or unethical. She simply took advantage of her job to get better service.

Yeah, well what if I’m not a journalist!?!

Businesses exist to make a profit. Except for Amtrak. These rules don’t apply to Amtrak. For everyone else, the goal is to convince the business that you are a potential source of significant profit.

The easiest way to do this is to take advantage of backdoor routes to elite status with loyalty programs.

Here’s a quick list of my elite statuses, and how I got them:

Marriott Silver: Marriott Premier Rewards Visa

Starwood Gold: American Express Platinum

Hilton Gold: Hilton HHonors Reserve Visa

Accor Platinum: Instant signup loophole

Kimpton Inner Circle: Status Match (more on this in a later post)

When I walk into a hotel, the front desk takes one look at their computer to see that I am an elite member of the hotel chain. As a result, I am immediately become someone who is not be trifled with. Additionally, I receive a variety of benefits that depend on the chain (a room upgrade being the most important). My strategy is to always proactively remind the front desk of my status, as if to reinforce the fact that I’m a BFD.

My second strategy revolves around my appearance and attitude at check-in (this applies to both airlines and hotels). I walk in with all of my information ready, and I try to politely move through the process as quickly as possible. I ask about my “Gold [Silver/Platinum/Inner Circle]” benefits. I talk about how I’m in [name the city] on a quick business trip to check out potential meeting locations for my organization.

This is where the men are separated from the boys.

At check-in, hotels have specific procedures for placing different guests into different rooms. Airlines have specific procedures for handing a variety of fees and upgrades. These procedures are often not as concrete as you think, and the individual employees often have more latitude than you think.

I’m going to offer up quick examples from this weekend to prove my point.

Hotels—Anything less than the best is unacceptable

Since I started working in March of last year, I have stayed 30 nights in hotel rooms. While I’m not the biggest traveler in the world, I do get out quite a bit. The majority of these stays were in Hilton properties, but I’ve also stayed at resorts (the Broadmoor in Colorado) and at Starwood, Marriott, and Kimpton properties.

I do not stay enough at any one of these chains to have top-tier elite status (eight of those nights were on reward travel, which doesn’t count towards status), but the individual hotels don’t know that.

So, when I check-in, the hotel is forced to recognize me as someone who is loyal to the chain and provides the company with a major source of revenue.  I fully recognize the fact that being a Caucasian male doesn’t hurt. I don’t condone stereotyping, but I can confirm that it exists. Being young is probably not helpful, but I have never run into major difficulty here.

Instead of offering a bunch of platitudes and hypotheticals, here are two real examples from my experience this weekend in Park City, Utah.

Night One—Park City Marriott

It’s no secret that I think Marriott is far inferior to Hilton. The rewards program is crap, the hotels are—dollar for dollar—much less satisfactory, and they offer fewer options at different price points. Still, I’ve racked up a bunch of points at Marriott, and I might as well use them.

At check-in, I was thanked for being a Marriott Silver member. Standard. Then, I was told that I was the “elite member of the day.” Not standard. In fact, I thought it was a joke, or it was something that said to everyone. Nope. I looked on the front desk and there was a plaque that read: “The Marriott Park City Welcomes our Silver Elite Member of the Day… Preston Cornish.”

I got a top-floor upgraded room and a few freebies. Not bad.

Night Two—Waldorf-Astoria, Park City

The Waldorf-Astoria is the kind of hotel that most people spend their whole lives dreaming about, only to realize the absurdity of spending $650/night on a hotel room.

This was free. It was also awesome. There were two fireplaces, two bathrooms, a W/D, and a full kitchen in the suite.

This was free. It was awesome.

Last year, I got two free weekend night certificates that were redeemable for any Hilton property that participates in Hilton HHonors. Me being me, I set out to find the single most expensive Hilton property in the 48 states. After a non-exhaustive search, I realized I couldn’t do much better than the WA during peak season in Park City. Because of the fact that it was peak season in Park City, the redemption was technically not allowed through the certificate, but I called customer service and had them convert my certificates into a whole boatload of points that wouldn’t be blacked out when I wanted to visit.

Of course, when you redeem points, you get stuck with the most basic room at the hotel. Normally, this isn’t a problem, because as a Hilton Gold, I get a room upgrade. For example, I booked a four night reward stay for a studio room at the Hilton Bentley South Beach and got upgraded to an ocean-view suite. I can’t say that I ever used the bidet, but it was pretty awesome to have one.

Did I pay for this room? No, no I did not.

Did I pay for this room? No, no I did not.

Unfortunately, there was a Panamanian oil company retreat at the WA when I visited, and as a result, the hotel was fully booked. When I asked for an upgrade at check-in, I was told that all rooms were full. I took the keys—dejected for the first non-upgrade of my Hilton career—and went to check the room. It had one bed. For two people.

Undeterred, I put on my upgrade thinking cap. Ladies and gents, this is the proudest upgrade of my young career.

My first step was to call the front desk. When I checked in, the agent mistakenly told me that there would be a pull-out couch in the room. I knew that he was probably wrong, but I hoped that he had given me an upgrade and not realized it. In fact, he had told me the wrong thing. I my call to the desk, I explained that I was misled when I was told that I would have a couch. I told him that I was arriving with two people, and that I needed separate sleeping arrangements.

Here is where you have to pull the shock and disgust card. “Quite frankly, this is a real shock to me, sir. As long as I have been a Hilton Gold member, I have never been put in a room like this. I think it is unacceptable, and I would appreciate it if you could find a way to make it right.”

Response: “I don’t know how I’m going to do it, but why don’t you come up to the bar, I’ll buy your first round, and I’ll see what I can do.”

Long story somewhat shorter: it took two hours, but I got upgraded to a one-bedroom, two-bathroom suite with a full kitchen and a washer/dryer. Not the most insane room I’ve stayed in (in the last 30 days), but it was pretty awesome. I will say that it was the first hotel room with a W/D I’ve stayed in.

I was upgraded because I was persistent, I identified why I thought that the hotel should do better, I did not settle for an option I was not happy with, and I indicated to the hotel staff that I had an alternative option if their hotel was not going to meet my request for an upgrade, by laying out my plan to switch to the St. Regis.

Here’s the reality: I was not entitled to an upgrade. In fact, suite upgrades are not part of the Hilton program.

Here’s the other reality: I would have switched hotels if they had not upgraded me. I would have found a way to get my certificates back. I would have made a big stink about their failure to upgrade me. I probably would have found a way to shift additional business to Starwood and Kimpton.

I was incredibly appreciative of the front desk staff (shout-out to Jonathan) for helping me out. They didn’t have to, but they did. I tipped the front desk manager who found me the room, Jonathan, pretty well on my way out. I have a super positive opinion of their property now. When I make my second million, I’ll be sure to head back.

Sharing travel experiences with loved ones is one of the best things you can do in life.

Sharing travel experiences with loved ones is one of the best things you can do in life.

Today’s Lesson

You don’t actually have to be a serious traveler to be treated like one. By finding the backdoor routes necessary to get loyalty status, you can be treated just like the folks who stay at properties 5-10x a month.

Hotel points and airline miles are a form of currency. Imagine if someone offered you 10,000 Mexican Pesos. Would you turn them down just because it’s harder to spend Pesos in America than it is to pay cash? No. It’s still a form of currency. 10,000 Pesos can be converted to American cash, or it can be used to buy stuff in Mexico. With loyalty programs, you earn a form of currency that can be used to “buy” rooms, plane tickets, and other stuff through the airline/hotel. It’s huge. If you take advantage of the programs, always looking for ways to earn maximum points with minimum spend, you can travel for free, or nearly free. It’s incredible. It will change your life.

On 1/20, I shared with you a background on how to start playing the credit card game. The rewards are huge and the time commitment is minimal. In the next post, I’m going to talk advanced strategies for playing one elite status off of another to gain maximum rewards.

You have to deal with people.

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I’m of the belief that people are inherently good. I believe that people want to be helpful, friendly, and kind. Institutions, society, and experience lead people to do bad things, but most of the time, most of mankind is good.

This is true when it comes to customer service. The further removed from a customer an employee is, the more corrupting the institution becomes. The best example of this is the call center. If a company cuts corners by outsourcing their service to a low-wage call center, it speaks volumes about how the company views its customers. Because people are less likely to even bother calling an unhelpful person making $1/hr in Bangalore, the company saves huge money. The problem is that the customer ends up hating the company and will do anything in their power to not do business with them in the future.

If you think about the industrial revolution, it was all about providing mass market goods to a massive number of people at a relatively affordable price. Back in the Dark Ages, you couldn’t afford to have 20 different shirts. Now, I can go to Wal-Mart, and for less than an hour’s work, buy enough t-shirts for a month straight of new shirts with no laundry. By the way, that is in no way indicative of me having a high salary.

The blessing and curse of the assembly line production process is that it is geared to create uniformity. On one hand, it is incredible that every single Hanes t-shirt produced at 20 cents a pop is exactly the same. On the other, it means that your shirt is exactly the same as the other guy’s.

The challenge in customer service is this: how can you maintain the uniform level of adequate service that we all expect, while also surprising and delighting customers by going above and beyond? Stan Phelps, who coined the term “Purple Goldfish,” talks about the idea of Marketing Lagniappe. For those of you, like me, who aren’t from Louisiana, lagniappe is the little something extra that you get when you make a purchase. Think about the small dessert you get at a restaurant, complements of the chef. That’s lagniappe. Or, think about the branded bumper stickers that you get when you buy something online.

Today, I think that we have both this simultaneous deep seated pessimism about the service industry as well as a sense of hope that we will be treated first-class. While we know the horror stories all too well, we have a belief that–for some reason–this will be the flight that we get bumped to the front, or this will be the hotel that upgrades us, or this will be the time that we are given a free drink at the restaurant.

On Friday, I talked about an disappointing experience at Nine Zero Hotel in Boston. The point of my post was this: expectations matter. My expectations for Hampton Inn are completely different than they are for Kimpton. My expectations on business are completely different than they are on pleasure. Above all else, I hate being negatively surprised. If you had plopped me in the same exact hotel room I stayed in at Nine Zero, and you had told me that it was a Hilton, I would’ve been mind-blown. But, because my previous experience at a Kimpton property (ink48 in NYC) was so insanely over-the-top incredible, my expectations in Boston were unmet.

I’m happy to report that: a) there was quick follow-up; b) the rest of my stay was about as good as it could have been; c) my stay the following at a different Kimpton property, Hotel Marlowe, was fantastic.

Here’s some visual evidence of what Kimpton did to make up for the fauxpgrade:

Image

That was at my door the morning of check-out from Nine Zero. Totally free. Totally awesome.

Image

And that was in my room when I checked into Hotel Marlowe not three hours later. In case you didn’t know, my favorite meal in the world is bagel with lox. 

The mass-market, crap customer service strategy works in the cellphone business, because there are huge hoops to jump through to switch providers. In most other sectors of the market, it doesn’t.

This past Saturday night, I called United to switch my flight for Sunday morning, because I knew that the weekend’s storms in the Northeast would cause a nightmare at Newark, where I was connecting. The agent was very helpful, but told me that I needed to call the booking agent to release the ticket for re-booking.

This is a brief transcript of my conversation with Priceline:

Me-“Hello, I just got off the phone with United, and I’d like for you all to release my ticket so that I can re-book with them.”

PL-“Sorry, but you need to provide us with the name of the agent and the code so that we can do that.”

Me-“Actually, I literally just talked to them, and I would be happy to call them back for them to handle it, if you would please just release the ticket so that they can handle it.”

PL-“We can’t do that. It’s a nonrefundable ticket.”

Me-“I know for a fact that my flight is going to get changed tomorrow. This isn’t me trying to monkey around and change my itinerary. I’m trying to do everyone a favor by switching it now, so I don’t have to wait around at the airport to solve it.”

PL (At 12:50 AM): “We are actually closing this number in 10 minutes, so you will need to call United to get the code, and then you can call the travel agency number to rebook.”

Me-“What you are telling me is to do something that is literally impossible. By the time that I get off the phone with United, you will be closed. So, I’m asking you to just find a way to do this now, so I can rebook it myself with United.”

Five minutes of back-and-forth aggravation followed, notable for the most entertaining line of my call center calling career:

Me: “Basically, you have no power, and your job is to simply tell customers ‘no,’ over and over again all day. Is that correct?”

PL: “That’s exactly what it is.”

Problem unsolved.

At 3:30 AM, I woke up to an automated call from United. My connecting flight was canceled.  That was the least surprising news of the day.

So, I got to the airport, went to United check-in, told them I’d need to re-book due to the cancelation, and was prompted re-booked to a US Airways flight. Super easy. If I had been able to do that over the phone, the outcome for the airline and for Priceline would have been the same, but I would’ve been able to get at least three extra hours of sleep.

There are a few lessons from this story that we can all unpack:

  1. Whenever possible, book directly with the company.
    • People like to book on third-party sites like Hotels.com, Priceline, and Hotwire because they think that they can get a better deal. This is true in a limited number of situations (when your travel is highly flexible, & when you are going last minute), but is usually wrong. All major hotel/airline companies offer a guarantee that they will post their best price on their own website. I like to use Kayak.com to compare fares/rates and then to book directly through a company website. This offers the benefits of comparison-shopping with the ability to post loyalty membership info directly through the company.
    • Usually, there is a benefit to rigging the incentives game to ensure that there is an entity that is looking out for you, as a customer. In the third-party booking case, you are signaling to the airline/hotel that you are a low-revenue, unloyal customer. The airline/hotel use this as a reason to treat you as a low-revenue, unloyal customer. As a result, the third-party sites often promise that they will fight on your behalf if you do not receive what you pay for. The problem is that they are incredibly stingy about this, and they will do anything in their power to get out of providing any sort of compensation to you. They will also go out of their way to not help you.
    • When you book indirectly with a company, your information is tied up in a 21st century game of telephone: you give your details to one company, which sends it to another company, which sends it back to the first company, which then sends it to you. The opportunities for disaster are ample.
    • You don’t get points, perks, or personalization when you third-party book.
  2. When you want to do something that is technically against “company policy,” you can’t expect much help through the phone or online.
    • When a customer service rep is being recorded and watched at all times, they are going to stick to company policy, at all times, regardless of how inane that policy is. See Point #3 for the corollary.
    • If a person’s job is to tell people “no” all day long, don’t expect to be the exception to the rule.
    • People love to help other people. I was re-booked, for free, on both of my United flights on this trip by a real human at the airport. Technically, I should have been stuck with my terrible connecting itineraries on both legs of the trip. By being friendly, easy to work with, and polite, I found that, magically, Priceline’s horribly restrictive policies did not apply to my flights.
  3. Don’t assume that you cannot get something simply because the first person you talk to says you can’t.
    • There are often company policies that are essentially unbreakable, but easily evadable. My favorite example is the game that airlines play with flight changes. If you want a guaranteed flight change, and your original flight has not been delayed or canceled, good luck getting a confirmed ticket for a different flight without paying a fee. However, flights are stunningly bad at showing up exactly on schedule. There is no hard and fast rule that you have to pay for an unconfirmed ticket on a different flight. I fly standby with some regularity, and I find that you can dodge the $75 change fee if you simply say: “I’m not willing to pay a fee, but I would love to get on an earlier flight, if at all possible. Is there a way to do that?” OR “My connection time has been reduced by X minutes. It’s simply too tight. Do you have anything direct that you could book me on?”
    • When you are on the phone with someone who is either incompetent or impolite, hang up and try again. You might get routed to someone who is having a bad day, is new at the job, or just hates life. Don’t put up with that. Tell them to have a nice day, and call back.
    • Always escalate when you can’t get what you want. If the original rep can’t do it, ask for a supervisor. If the supervisor can’t do it, ask for a manager. If the manager can’t do it, contact the company’s social media team. If the social media team can’t do it, contact an outside blogger or news outlet. And, always be transparent about your intention to escalate.

As much evidence as there appears to be to the contrary, the reality is this: we are living in the most customer-friendly era in history. The price of consumer products is way down, the quality is way up, and the Internet, globalization, & the free market have made it easier than ever to produce and purchase a vast array of goods and services. At the same time, the pressures of quarterly earnings and shareholder demands have meant that an increasing number of companies have chosen to cut corners to improve short-term profits.

You do not ever have to put up with bad service. Seriously. In the short-term, there will be times when you cannot immediately find an acceptable outcome to your situation. It is terrible. I hate it. In the long term, the marketplace has so many competitors that it is idiotic to give money to a company or service that you are not satisfied with.

I think that my next post is going to be about how you can create the illusion of being a high-dollar customer, even if you do not make a lot or spend a lot. Appearing to be a part of the 1% has its advantages.

Why it matters who you do business with: why the burden of high expectations can be worse than mediocrity

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Update:

I had a great conversation with some of the folks at Kimpton over the weekend, and the rest of my stay at Nine Zero was fine. I still stand by what I’ve written. Sometime later today or tomorrow, I’ll have a full post about the rest of my Boston trip, with some information on how to avoid paying huge fees for flight changes, seat upgrades, etc. Ultimately, I was satisfied by Kimpton’s response–it seems to me like this experience was more of an outlier than the norm.

 

As I write this post, I’m sitting in my room at Nine Zero, a Kimpton hotel, in Boston. Yesterday, I decided to get out of Washington for the weekend, and Boston seemed like a good choice. I have plenty of points, miles, etc, so it costs me basically nothing to travel.

This is somewhat of a departure from my previous posts, but I think it will be of use to those of you who want to gain broader prospective on how to set up the right stays, flights, etc, to ensure great customer service.

A Case Study: Why I am so frustrated with this hotel.

I am sitting in a hotel room that I paid out of pocket cash to stay at.

I developed a strange lust for Kimpton after a brief stay at ink48 in Hell’s Kitchen, Manhattan. Those of you who follow me on Twitter and Instagram no doubt got a chance to see my love for the property, which is hands-down the most insanely amazing place I’ve ever stayed at. By the way, this is one month after I stayed at the Hilton Bentley in South Beach Miami, where I was upgraded to an oceanview suite using Hilton points. I paid nothing out of pocket for a $700+/night room. Crazy.

At the time, I told the folks at the hotel that they had just presented me with the sharpest double-edged sword known to man. On one hand, it was an amazing experience. On the other, every hotel experience I have, from here on out, will be judged against perfection. Nobody is perfect. Thus, I’m bound to hate every hotel I ever visit for the rest of my life. Or so I think.

This brings us back to the hotel where I am currently staying. Nine Zero is a fine hotel. It may even be slightly above average. It’s certainly not a La Quinta Inn.

Hotels are a fantastic place to score customer service concessions because of the way that the hotel industry is structured. In a nutshell, individual hotels are franchisees of a larger chain. The Hampton Inn in rinkydink nowhere? That’s owned by a local dude who is licensing the Hampton Inn name in an attempt to increase his ability to draw in travelers, primarily people on road trips.

The practical impact of this is that the corporate office of the hotel chain has an extremely strong incentive to make sure that the individual hotels aren’t screwing over customers. If I stay at a crappy Hilton in Los Angeles (I haven’t—but let’s pretend), I might decide to stay at a Westin (part of Starwood) in New York, instead.

Hotels are not fast food joints, however, and you can’t “Big Mac” rooms. Your Embassy Suites in Brentwood, TN might have the same giant atrium as your Embassy Suites in Boca Raton, FL (trust me, I’ve been to both, and they do), but the maids are different, the front desk is different, the construction company is different. The people who put in the carpet are different. So while you may get the same tasting Whopper in LAX as you do in Washington, DC, you will never have exactly the same hotel stay. It’s simply impossible.

Where this gets especially tricky is in the “boutique” space. I’m staying at a Kimpton property in Boston, where I expect the quality to be the same as the Kimpton property I stayed in in New York. It’s not. It’s not even close. Quite frankly, it’s so maddeningly worse, that I want to gouge my eyeballs out and mail them to the CEO of Kimpton—just to make a point.

The problem that Kimpton now faces is that I now have an opinion of the hotel chain as one that is fundamentally inconsistent. Whereas I have never had a bad experience at an Embassy Suites (and I’ve been to more than I can count), I also have never had a great one. It’s almost always the same level of mediocrity, and I know exactly what I’m going to get. On a business trip, this is fine. I will continue to stay at Embassy Suites in the future. I can tell you exactly what they have on their omelet menu. I order breakfast there by instinct. It’s comforting.

On the opposite side of things, when I went to ink48 in NYC, I received the most massive room upgrade I have ever gotten. I got a welcome amenity that was so over-the-top amazing that I’m still drolling over the bagel, brownies, gin-tonics, iced tea, etc. The check-in staff were so nice that I remember their names.

When I planned my Boston trip this week, I had a choice. I could either stay at a Starwood, Hilton, or Marriott property, for free, or I could pay to stay at a Kimpton property. My trip to ink48 was so incredible, so memorable, and so crazy, that I willingly paid to stay at Kimpton, instead of staying at another property for—let me repeat—free. That is unbelievable brand loyalty.

I now regret that decision.

The worst thing that a company or organization can do is build up expectations, only to fail to meet them. If you are The Pit in Raleigh, North Carolina, you have a reputation as one of the best barbecue joints in the country. If you deliver slightly above average barbecue, you are going to piss off your customers. They are going to spread the word that your barbecue is not “the best” but only average. People will stop coming. What’s the point of going out of your way for average?

The problem with this hotel (full disclosure: I plan to send this link to the hotel and to management, and I hope that they can rectify all issues I lay out. I will update this post, as needed) is that they created this grand illusion of fantastic customer service, and then they just took a giant dump on me as soon as I got here.

One thing that Kimpton does to raise the bar is a welcome email that they send to all elite “Inner Circle” members. I received an email earlier today, which greatly increased my anticipation for the stay.

“I am here all day so if you need anything or anything pops up, just send me an email and I will handle it for you.  Safe travels and I look forward to welcoming you and having you stay at the Nine Zero.”

When I arrived at the hotel, I had a mediocre check-in, and was told that I had a “king room” on the 19th floor. Uh oh. Sounds like I’m getting the dreaded faux upgrade, which is when the hotel tries to take credit for giving you a great room when they actually give you exactly what you paid for.

My room was, in fact, exactly what I paid for: a single king. No suite. No perks. No welcome amenity. I went to call the front desk to ask the all-important WTF?!, but I was pre-empted by a call from…you guessed it!…the front desk.

I asked the staff member two simple questions: where is my welcome amenity? I also told him I was very disappointed in the room and I asked if they had any suites available. “No,” I was told.

Interesting, because I checked on the reservation system, and there are multiple suites available for purchase. At least the welcome amenity was on its way.

One of two things is going on here: 1) they are lying to me about all suites being occupied; 2) they are lying to potential customers about all suites being occupied. Either way, it’s a total BS move.

Throughout this afternoon, I have been in what can only be described as a ridiculous game of back-and-forth emails with the Front Office Manager. While I have been crapped on through the actions of the hotel, I have received overly friendly and accommodating emails from the staff. This is the pinnacle of absurdity.

Sometimes, you are going to experience customer service that is beyond bizarre. You will be treated like a king when you interact with staff members, only to receive actual service that is laughably subpar. You will do everything in your power to politely and forcefully point out what is wrong and what would make it right. No matter what you say, or what they say, nothing seems to actually happen. You’re caught in a hamster wheel of affection, with nothing to show for it.

The best way to deal with these situations is to clearly and accurately document every single incident of BS that is fed your way. There are people out there who are so starved for compliments and positive encouragement that they will feast on the BS instead of focusing on the fact that they have achieved nothing concrete. They will lavish praise on the people who distract them from getting what they expected to get. Most people go through life expecting to never be called out for lying, manipulating, and exploiting people. They wake up each day and learn that the best way to make people happy is to feed them what they think that they want to hear. This is nonsense.

If employees treat customers as entities to be pandered to, as opposed to treating them as people who deserve respect and gratitude, we all suffer. Customers accept fake praise and empty promises. Companies learn to distract and disrespect their customers.

We all lose.

Next week, God willing, I will return to offering concrete tips for ensuring that you don’t get screwed by the companies that you are giving your hard-earned money to. Until then, enjoy the Super Bowl and stay safe.

The Forest vs. the Trees: Why you should stop focusing on the minutiae and start focusing on the big picture

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One of the biggest problems with that I have with customer service tips is that they focus too much on tactics and not enough on strategy.

This is what I like to call the “resume trap.” Lots of unemployed people focus their time and their energy on refining their resume instead of focusing on the big picture strategy of their job search. Sure, you might be able to become incrementally better at getting a job if you improve your resume. On the other hand, you could become exponentially better at getting a job if you focused on things like building your personal network, targeting a highly specific job in a specific industry, etc.

In customer service, people tend to focus far more on the tactics of things like: how do I talk to a cable company phone representative? How do I come up with an excuse to return an expensive dress that I wore (tags tucked in, of course) to one event?

On the other hand, the news media loves to focus on “viral” stories about how one individual customer was able to get the attention of millions to their customer service woe. Think of the egregiously bad song “United Breaks Guitars,” Spirit Airlines’ debacle with armed forces veterans, or Kevin Smith’s fat ass being too big to fly on Southwest. First, why is Kevin Smith flying Southwest? Second, why didn’t he learn the most important lesson, which is that he should drop some weight? Third, how is any of this relevant to you?

The reality is that these tactics are far less important than the overall strategy.  This post is all about how to formulate a customer service strategy that will succeed in all aspects of your life. If you are able to successfully tap into the cultural zeitgeist, landing a huge viral hit that gets attention from a corporate CEO and the hosts of the “Today” show, congratulations! Write a book. The guy from “United Breaks Guitars” did. He’s also kind of a tool. You’re not. You are, in fact, reading this blog.

Later in the series, I’m going to talk about the first specific step that you need to take when you have a customer service issue. In this post, I’m going to introduce incentives, and how they shape the world of customer service.  Tomorrow, I’m going to talk about two specific cases where incentives will shape the type and quality of service you get.

Once you have decided what you want (and it doesn’t need to specific), you have to figure out how to get it. This is where incentives come in.

An incentive, broadly speaking, is something that encourages someone to do something.

The people who work at the Customer Retention desk at a cable company are paid based on how many people they can convince to not cancel their cable service. As a result, you can get free Showtime and Starz (but not usually HBO—this is a topic for a longer discussion) just for calling and spending five minutes threating to cancel your service. Easy.

A bartender receives most of their compensation through tips. As a result, you are going to get much faster service (and better pours) if you tip well.

Sometimes, the incentive structure is opaque. For example, what is an hourly employee at Best Buy getting paid to do? Are they paid based on how much you buy (short answer: no)? Are they paid based on customer satisfaction surveys (short answer: no)?

When you go into a customer service situation, you always want to think about how you can align your interests with the interests of the employee. Then, you want to find the employee/department where the interests best align.

Customer service is about finding common ground between the company's interests and your's

Customer service is about finding common ground between the company’s interests and your’s

Here is an instance where traditional advice is flat out wrong: you cannot go into a customer service situation with a specific and non-negotiable request. For example, the front desk at a hotel cannot simply give you a massive cash refund because your stay was mediocre. They can, however, give you a bunch of their reward points (which are, if you think about it, a form of currency). Likewise, an airline gate agent cannot guarantee you a first class upgrade if you bought a coach ticket. They can, however, let you move up front if there are empty seats.

Inflexibility and incentives are at the heart of why people don’t get what they want. The “United Breaks Guitars”-guy (UBGG, from here on out) is a great example. This is a guy who decided to check his $3,000 guitar on a flight. He is an idiot. There is no way to get around that. When he found out (alert—shocker of the year!) that his guitar was broken in transit, he spent months trying to get compensated. If this guy had an American Express card, he could have just called their customer service, and they would’ve taken care of everything. Instead, he wrote a crappy song that tugged at the heartstrings of Middle America, winning himself media exposure that resulted in specialized attention from United.

Let’s look at this from an outside perspective. United, in this case, has absolutely no reason to help this guy out. He is an infrequent traveler (& provides very little revenue to United), he values his guitar at an absurd level, and he is unwilling to accept anything less than a full replacement for his damaged property.

In his case, he has three ways to get his situation solved: 1) accept non-monetary compensation for the loss (ie, airline vouchers, lounge access, etc); 2) enlist the help of a third-party insurer or customer service rep (American Express, travel insurance, etc); 3) become a media sensation and play by an entirely different set of rules (what he actually did).

Employees will bend the rules, if you can align yourself with their incentives. Here is a great example. I have a friend who is a huge Nationals fan. This guy [name withheld to protect the innocent] sits on the first base, field-level of dozens of Nationals games a year, mostly for free. His secret? He buys the promotions manager a great gift at the beginning of each season, stops by to chat before each game, and is friends with the usher in section 130/131. In this case, nobody has great reason to fear being exposed. Everyone wins.

On the other hand, if you want to check baggage on a major airline, and you do not have elite status, you are going to have to pay. The employee cannot simply put your baggage into the system without a corresponding payment. If they did that, they would be fired. It’s that simple.

To sum today’s lesson up: if you want something, you need to convince the individual(s) who is/are representing the corporation that by giving you what you want, it will benefit the employee and/or the company. The key to doing this is to understand the incentives that the employees have. By tapping into these incentives, you can achieve a successful outcome.

Later in this series, I am going to provide some advanced tips on how ordinary customers can take advantage of a level of service that is typically provided to only the highest-level customers.

How to Master the Art of the Customer Service Complaint: A New Series

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When I was ten years old, my mom did something that changed the course of my life. We had just parked in the satellite lot at BWI airport, and because of our location, we were the last stop on the bus loop. Every bus that passed us was full, and we waited for about 30 minutes, with no bus in sight. My mom, infuriated at the idiocy of the bus loop, had enough. She walked into the road and literally stood in front of the next bus that pulled into the lot. She refused to move until the driver opened the door and let everyone at our stop on board. The crowd cheered, and I proudly boarded the bus.

What happened? How was she able to do what nobody else had been able to do? Plenty of other people were at our stop. They complained. They tried to flag management. But none of them were successful in achieving the goal of getting aboard the bus.

This is an important anecdote, because it hits at the key to customer service: most of the time, most of the employees you deal with have constraints on their ability to go out of their way to make your individual life better. For people in the service industry, their entire day revolves around putting out various fires. They have to solve one issue after another. It’s exhausting. Most of these people are underpaid. They don’t get recognition for the good work that they do, and customers often treat them with a level of disrespect and vitriol that is inexcusable.

Here’s a quick point, before I go into the weeds: You’re not an asshole for wanting to be treated well. That said, almost every bad situation you encounter is not the fault of an individual employee. American Airlines, for example, is a giant company that hemorrhages cash. It’s not the gate agent’s fault that non-elite passengers have to pay for checked baggage. At the same time, the gate agent does have the power to waive that fee. So while the front line employees have a lot of power to make things right, they have extremely little power to change the rules of the game. Keep this in mind. Don’t get mad at the individuals. Get mad at the system. Bend the rules to make things better for yourself.

Here are a few examples of my customer service “wins:”

  1. Had a Car2Go rental fee and parking ticket waived by challenging their GPS system, which showed that I had parked one street over from the place where I had been ticketed. Pointed out the fact that it took them three months to send the ticket. Savings: $400. Preston Cornish rush hour-tow 5-9-12 (1)
  2. Got a free night voucher at the Westin Grand Central because I had booked a double double and was put into a handicap king room. Value: $300.

    I got a free night! With ten minutes on Twitter!

    I got a free night! With ten minutes on Twitter!

  3. Was offered a $20 drink coupon because my shower was “making a weird noise” at a Doubletree.
  4. Got 10,000 Hilton HHonors points because my name was written as “Mr. Cornish, Preston” on a welcome letter.
  5. More room upgrades and free breakfasts than I can count.

There are a few basic ways that I use to achieve a customer service “win.”

Each day this week, I’m going to focus on one of these topics. If you have topics that you’d like me to cover, let me know in the comments. I’ll try to cover as much as I can in the series!

 

Loyalty Challenge 2013: Background Primer

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As part of my job, I travel a lot. I travel to the West Coast, to New York, to Florida, and all points in between. I also book a decent amount of travel for my colleagues. Because I travel a lot, I try to put some thought into it to make my experiences better. I also try to build up enough points to be able to travel for fun.

The first point is this: if you don’t have at least one travel rewards credit card, you are leaving money on the table.

  1. Sign up to check your free credit score at creditkarma.com
  2. If score is above 700, proceed. If not, contemplate the meaning of life, pay off some debt, and wait.
  3. Sign up for 1-2 cards (3-5 if you plan major CC spending in the next 3 months) on the following page, on the same day. You can sign up for the biz and personal cards at the same time to “double dip”: http://millionmilesecrets.com/hot-deals/
  4. Make sure that one of those cards is a hotel card
If you do this, and you make sure to target your spending on those cards, you will rack up serious points. I can write later about how to leverage the points/status you get from those sign-ups to bring in additional status.
 
On my cards alone, I have saved the following rough amounts:
  • Marriott Premier: Saved $130 through 1 night free voucher; Saved $200 by using sign-up bonus to book UT hotel. I only needed to spend $2 to get this.
  • Hilton Surpass: Got 60k sign-up and Hilton Gold, which has saved me hundreds on breakfast at Hiltons, alone, plus upgrades worth hundreds more, plus points which I used to book Miami trip.
  • AA: put $2.5k of normal spend, got 50k points which was enough to book first class for pops and I to SLC (worth over $2k); saved at least $100 on luggage fees and others, plus got priority boarding
  • US Air: spent $5 on first purchase; got 40k points, which is nearly enough for 2 roundtrip tickets; saved on bag fees
  • SPG AmEx: got 10k points with first purchase (enough to book 100-150 dollar hotel); with spend req I will have enough to convert to a RT coach ticket on American
  • Hilton Reserve: 2 free nights with normal $2.5k spend; got 2 free nights at Waldorf Astoria Park city (worth over $1,500)
  • AmEx Platinum: 100k points, which converts to 5 roundtrip tickets in coach on American; lounge access with American, US, and Delta and a bunch more
In total, I have gotten thousands of dollars in travel that I would not have otherwise had. I now have tens of thousands of dollars in credit, which significantly boosts my credit score, and I have elite status at Marriott, Starwood, Hilton, and Kimpton. Every three months, I take a look at my credit cards, evaluate spend reqs, and apply for the I don’t currently have which have good sign-up benefits. Most cards waive the first year fee. This takes less than an hour, probably more like a half-hour. I use only one card at a time, pay it off completely while I’m using it, and put it in a drawer when I’ve met the spend req. When I sign up for the card, I also sign up for automatic bank withdrawal of the full balance, so I don’t even think about when I need to pay it, what I need to pay, etc. I just make sure that I’m not spending more than I bring in.
If you are serious about travel, even one credit card sign up that will take you five minutes will save you hundreds of dollars. If you are willing to put in an hour every three months, you can astronomically increase your benefits, but if you are unwilling to do so, even a five minute simple sign-up is enough for huge gain.