By William]. Brown

te in~da \rn~he nternet

Industry

professionals should

prepare for an

appropria te response

if angry customers stage

a confrontation over

the In ternet.

IWhat do Bally's Total Fit~lss cotporation, Terminix Interna-tional, the Ford M~tor companyzand Dunkin' Donuts have incommon? All haJ~ dZisco~eredle power of the Internet beingused against them.

While <?re;;'tinga new channel for companies to improvecommunications/(('ith thei!customers, the Internet also has

~ created n~aild equa~/PowerfUI ways for dissatisfied cus-~s.-ana people with unscrupulous motives to complain to a

worldwide audience/Such individuals have created Web sites togripe about ~r1rustrations or accounts of personal and col-le?,atiVe experiences with a number of companies.

___ ----·,-yO U 're Not- Untouchable

In 1998, Andrew S. Faber of Long Beach, California, turned tothe Internet to rail against Bally's Total Fitness Corporation, thelargest for-profit fitness chain in America, with more than threemillion members. Faber launched his Web site, Bally'sSucks, after becoming disenchanted about histreatment as a customer. The home page con-tains Bally's federally trademarked logo and,directly beneath, the word "sucks" in aspray-painted style. Also on the site arestinging criticism of the corporation andits products and services, and dozens ofcomplaints posted by consumers. Morethan 30 major newspapers and maga-zines have publicized Bally's Sucks as anexample of an extreme customer-servicedisaster.

After requesting cease-and-desist actionfrom Faber, Baily'S filed suit in November of1998, claiming that his actions constituted trademarkinfringement, dilution, and unfair competition. The court dis-agreed, asserting Faber's First-Amendment rights to freespeech.

According to attorney Martin H. Samson of the Law Firm ofPhillip Snizer, "Perhaps the most significant aspect of thecourt's ruling is its determination that a party who builds anon-commercial website Isicl to promote consumer criticism ofan entity can use that entity'S trademark in the meta tags of hissite to attract users to it." (Full text available at www.phillipsniz-er.com/int-art 129.htm). Meta tags are devices that many searchengines use to help Web surfers find Internet sites. Furthermore,the court concluded that the average consumer was not likely tobe confused by Faber's use of the "Bally" mark or assume thatthe Web site was created or authorized by Baily's Total Fitness.

Marchi April 2000

This ruling has ominous ramifications for companies con-cerned with their Internet brand image. Other firms that havesince seen their federally trademarked logos or brands used insimilar ways include the biggest termite and pest-control fran-chiser, Terminix International; and Ford Motor Company. Ter-minix and Ford filed suits similar to Baily's. The Ford suit hasbeen thrown out; the Terminix case is pending.

Can't Beat 'Em,So Join 'Em

In 1997, David Felton of Connecticut launched a Web site -DunkinDonuts.org - highly critical of the Dunkin' Donuts unitof Allied Domecq pic. His gripe? Once, he couldn't get skimmilk for his coffee at a local franchise. After he began postingcomplaints to his own Web site, other dissatisfied customersstarted e-mailing their complaints to him. Felton then regis-tered the DunkinDonuts.org Web address and created a stand-

alone site that received thousands of visitors from aroundthe world.

Instead of filing suit, Dunkin' Donuts pur-chased the web site from Felton. (According

to The Wall Street Journal, negotiations start-ed at $1,070, and went up modestly fromthere.) Management deemed the cus-tomer feedback extremely useful, andcontinued to operate the site withoutFelton's participation. (Later, the compa-ny rolled the .org site into its .com corpo-

rate site.) Thus, the management ofDunkin' Donuts disarmed a potentially

embarrassing public-relations situation,saved money by averting a protracted legal battle

with negative precedents, and demonstrated to thepublic that they valued negative feedback and built tremen-dous good will in the eyes of their customers. This episodeyielded widespread favorable publicity in newspapers andtrade journals.

Lessons ForVacation Ownership

For vacation-ownership developers, too, the web can helpboost sales, but also can very quickly turn critical. Several of theexamples above have been discussed in the American ResortDevelopment Association's subcommittee on Internet regula-tion, chaired by Susan Voss of the Holland & Knight law firm.

Because the vacation-ownership industry depends soheavily on customer contact and positive experiences, and

II

because nobody is perfect, derogation maybe inevitable. Industry professionals shouldprepare for an appropriate response if angrycustomers stage a confrontation over theInternet. Here are some suggestions:• Don't try to register every possible ver-

sion of your name. Through Network Solu-tions (www.networksolutions.com) and otherdomain registrars, companies can registertheir unique Web addresses, provided otherparties have not done so already. Still, somecreative individual easily can pair your brandname with a derogatory word or phrase, asoccurred with BallysSucks.com. Attemptingto register every imaginable combination(at $70 each) would be prohibitively expen-sive, and you still wouldn't cover every pos-sible combination. Throw in the addedcosts of .net and .org, and the numbers startgetting very large. Instead, just register yourcore brand names and build them into cus-tomer-focused extensions of your offlinebusinesses.• Customerscomplain when they'reangry.

Cyberspace amplifies their ability to tell morepeople why they are angry, but don't look atthese situations as technology challenges.They remain customer-service challenges.Does the individual complaining about yourcompany have a legitimate reason to beupset? Even if the customer is wrong, canyou take reasonable steps to resolve the dis-pute before the creation of a Web site publi-cizes the situation?• They've turned my brand into

"Mycompany'Sucks.com." What do J donow? Try to resolve the situation peaceful-ly. Remember that people complain untilsomeone listens to them. Many such situ-ations can be disarmed with a simple let-ter of apology and some token gesture ofgoodwill on the company's behalf. Usecease-and-desist letters and lawsuits onlyas extreme fallback measures.• Beef up your online customer-service

function. The real-time nature of the Inter-net does not know operational constraints- nor should your online customer-servicesupport function. Staff it around the clock,and give it a mechanism for posting feed-back as Dunkin' Donuts did, so your cus-tomers won't turn elsewhere to expresstheir feelings. Encourage both good andbad feedback. Identifying problems earlycan help you solve them before they getblown out of proportion.• Treat your complaint-makers with

respect.Remember that nine out of 10 people

12 www.re6ortdeve!oper.com

that "your customers are only satisfiedbecause their expectations are so low andbecause no one else is doing better. Justhaving satisfied customers isn't goodenough anymore. If you really want abooming business, you have to turn yourcustomers into raving fans."

The vacation-ownership industry hascome very far in raising the standards ofcustomer and membership services. TheInternet may create new challenges, but thegoals remain the same. The lessons we canlearn from others should help us to defusesuch situations if they ever happen to us.

The lessons

we can learn

from others

should help us

to defuse such

situations if

they ever

happen to us.

William J. Brow i diFgGtgr-Qf-~ ommerce_ ~-trrteractive marketing for Interval Inter-

simply want someone to listen to them.~ ~a,tional. He earned a Master of Businessoblige - contact them immediat~pon Administration degree from Drexel Universitylearning of their dissatisfaction, ask what is in Philadelphia and has completed course-troubling them, institute effect0e systems if work towards an Executive Master in Tech-such systems don't alread{exist, and make nology Management through the Whartonevery reasonable eff~ accommodate the School of Business. He also is an adjunct pro-aggrieved individuals. lessor of the University of Miami School of

In the book RGvingFans:A Revolutionary B.rtsrrleSs,;he~~s-g.r~e classesApproach to zrlstomer Service, author~- involving strategic use of the Intern~isneth Blanchard and Harvey MacK v argue e-maii addressiswbrown@interval-intl.com~

VACATlbN INDUSTRY I__ Ill__