Amazon Does Right by its Customers (Premium)

Amazon’s success is often portrayed as the result of its aggressive business tactics. But the firm’s excellent customer service plays as big a role in that success, I think. And this is a wonderful example.

As you may know, Amazon has long offered its Kindle e-book readers and Fire tablets in two versions: You can save $15 to $20, depending on the product, by selecting a version “with special offers”. Doing so means that you will see advertisements on the device’s lock screen/screensaver (again, depending on the product) as a way to subsidize the price. If you don’t want to see these offers, you can pay more at purchase time or later pay to “unsubscribe.”

While I’m no fan of advertising, I feel that this system is fair: Amazon doesn’t gouge you for removing the ads later if you don’t want them: You simply pay the same price you’d have paid to do so at purchase time. And because many people don’t care about or even see these ads, getting a device version with special offers is a nice way to save some money.

In mid-2016, Amazon implemented a similar strategy for smartphones. Through something called the Prime Exclusive Program, Amazon has offered various low-end and mid-range unlocked Android handsets from companies like LG, Motorola, and Nokia with or without lock screen advertising, and at low-cost. As with the special offers on its first-party products, customers could pay at purchase time or later to remove those ads. (And the phones come, of course, with various Amazon apps and widgets pre-installed.)

Prime Exclusive phones did have one catch (and still do): You need to be an Amazon Prime subscriber to get the lower prices. Perfectly reasonable, but good to know.

Anyway, Amazon revealed last week that it will no longer display lock screen ads on new Prime Exclusive phones. (It will continue to bundle its apps on the phones, of course.) At the time, it said it would ship an update to existing customers to remove the ads as well.

“We want to evolve the Prime Exclusive Phone experience to ensure customers can easily use features such as the phone’s mobile unlock technologies like facial recognition and fingerprint sensors, as well as be able to personalize device lockscreens with photos or wallpapers,” the online retailer explained.

To cover the cost of the change, Amazon is raising the price of new Prime Exclusive phones by $20, in line with the price increase on Kindle ebook readers and Fire tablets when you remove the special offers.

But here’s where things get interesting. Amazon has also emailed existing Prime Exclusive phone customers who unsubscribed from lock screen ads to let them know that they are being refunded $20 too.

“Because you paid to unsubscribe from lockscreen offers and ads, we will apply an Amazon Gift Card to your Amazon account for the same amount you paid,” the email states.

How nice is that?

More to the point, this is the kind of customer service that is common from Amazon. In fact, I think of them as a sort of “Neiman Marcus for the non-rich”: They just treat their customers right.

And you can apply this thinking to many of Amazon’s products and services.

Consider the firm’s longtime $9.99 pricing model for Kindle ebooks. Which might be seen as predatory if you’re a competitor or publisher, or as consumer-centric if you actually want to buy ebooks at reasonable prices.

This policy upset publishing giants so much—even though Amazon was taking a loss in many cases—that they entered into an illegal cabal with Apple to artificially raise ebook prices. That effort failed, leading to legal and financial repercussions for all of them. (And to refunds for the consumers who were ripped off.) Less successfully, however, ebook prices still ended up rising, and we now pay an average of $14 for new books. Thanks to Apple and the publishing industry.

Hey, Amazon tried.