How will Google manage growing demand for support for its free products, as people rely more and more on its services?
(Credit: Screenshot by Tom Krazit/CNET)If you rely on a compelling service that happens to be free, what level of customer support are you entitled to receive?
Google is trying to figure that out. Known for using brilliant engineers, complex algorithms and speedy servers to organize online information in a simple and accessible fashion, Google is learning how to add the human touch to its repertoire as customers look for answers that can't be found on an FAQ.
Not surprisingly, not everyone is happy with the results. Some advertisers have been complaining about Google's Web-page-first approach to customer service issues for years, with the most common gripe that they find it exceedingly difficult to reach a real live human being when they have a problem that isn't answered on a product Web page. More recently, Katie Braband, who reported problems with Google Checkout's handling of transactions at her company, Datto, was just as frustrated by Google's response to her issues as she was the issues themselves. "The only e-mails we've received response to are pre-generated, it's very clear there's no person writing the e-mail," she said in September.
Google is aware that customer service will play a large role in its growth as it offers more paid services, and seems committed to improving services for those kinds of customers over time. "The first thing a CIO is going to say is, 'where is that person and how do I wring their neck?'" said Google CEO Eric Schmidt in an interview earlier this year. Schmidt knows a thing or two about traditional enterprise customer service: he ran corporate software maker Novell before joining Google. And before Novell, he was an executive at Sun Microsystems.
For many users of Google's free services, support is limited to a series of Web pages, FAQs, and user forums. That's not that surprising, since Google can't realistically offer phone support to every Gmail user who can't figure out the conversation-based design.
But as Google continues to push forward with free advertising-supported services that people and small businesses increasingly rely on in their personal and professional lives, the company appears to be banking on its ability to train those users to expect a healthy dose of relatively low-cost support. Web pages with hints, troubleshooting tips, and discussion forums are the first level of support across virtually all of Google's products and are pretty much the end of the line for those who do not pay to use products or services. That's not unusual in technology; even businesses that charge customers for their products have moved in that direction in a bid to cut support costs.
When it comes to Google's main profit engine--the AdWords search keyword ads--there are two basic kinds of customer service, said Deanna Yick, a Google representative. High-roller customers enjoy access to a personal sales team they can reach out and call, but almost everyone else relies on Web-based resources like the AdWords Help Center.
For a while, Google also offered phone support to a proportion of those advertisers without sales team connections. However, it recently reduced the amount of phone support it provides for those not supported by the sales team, leaving e-mail as the sole contact method for a larger segment (Google won't say exactly how many) of its most important customers.
"AdWords is an effective, self-service online advertising platform for advertisers of all sizes worldwide," Google said in a statement regarding the reduction in phone support. "Some clients work with our sales teams, while others prefer to manage their accounts independently. We also provide email and phone support to some advertisers, and have worked hard to build out a robust set of online resources (such as the AdWords Help Center, AdWords Learning Center and user forums) to help advertisers find the answers to their questions around the clock wherever they might be located."
Is this an issue? Google argues that in many cases e-mail and Web support can be faster than sitting on hold waiting for the next customer service representative to answer your call in the order in which it was received. The company can track the most common queries and therefore answer the most commonly asked questions on the Web much more quickly than a telephone-based system would allow, while also developing fixes for commonly reported problems as to cut down on the need for support in the first place.
But on the Google Apps side of the world, the company knows it doesn't have the luxury of pulling back on phone support with its most important customers, said Matthew Glotzbach, director of product management for Google Enterprise.
Here, as well, Google tries to encourage its users to solve their issues through forums and troubleshooting pages. It turns to the solution Google employs for just about everything--an algorithm--to get the most relevant information regarding support issues on those pages and before the people who need detailed answers, and fast.
But Google Apps Premium users--who pay $50 a year per user--can also talk to live Google support personnel anytime day or night when they encounter issues. Years of phone-based IT support has trained system administrators and IT executives to expect the human touch when it comes to advanced support, Glotzbach said, echoing Schmidt's comments last month.
Glotzbach--like any true Googler--believes there are efficiencies just waiting to be discovered that could be greatly improve the customer support experience for both Google and its customers.
"I think this is a fascinating technology and innovation challenge that's properly underappreciated as such," Glotzbach said. "When people think of support, they think of large call centers. But underneath that there is a massive opportunity to innovate." Left unmentioned were the cost savings that accompany automated support.
With innovation comes friction, however, as new ways of thinking about old problems grate on the status quo.
Google is pushing into a whole host of businesses in which it is a newcomer, such as Google Apps, Google Voice, and now Google Maps Navigation. In many cases, those products are free, which reduces expectations for premium support (usually). But those products compete against paid products and services that do provide some level of support.
As more and more people rely on these free services--and Google crowds out competitors who can't compete with free--support issues will grow. Even products that "just work" fail from time to time, and those failures present opportunities for companies to build loyalty if they handle the support encounter the right way, and resentment if they don't.
Can Google train those customers to expect a passive Web-based support experience? Or will Google's free strategy evolve into two groups, those willing to tolerate passive support for free, and those willing to pay a little extra for more service?
Either way, managing the customer experience has been a relatively easy task for Google up until now; basic search requires little customer support. It's about to get a lot more difficult.
An important feature in Google Checkout has now been unavailable for almost a month, and some merchants are getting fed up with Google's automated approach to their concerns.
Google's ability to handle recurring payments, such as monthly subscriptions to a service that are automatically billed once a month, has been impaired since around the middle of August with little notice by the outside world. A customer first reported the issue in a Google Checkout forum in August, and others, such as Katie Braband, sales director at storage company Datto, are still unable to rely on Google to process anything other than one-time payments.
Braband went into Datto's offices on September 2 to a nightmare for any small business owner: the monthly revenue from subscriptions to Datto's off-site data backup services did not arrive as scheduled in its Google Checkout merchant account. Making matters worse, there was no way to contact a live human being at Google directly; Datto was directed to an online forum and support page where they received this response: "Our engineering team is working to resolve this as quickly as possible, though I'm not able to provide a specific timeline at the moment."
Google confirmed there are still problems with Google Checkout on Wednesday but provided no time frame for a fix. "We're currently looking into some service disruptions to Google-handled recurring payments. Merchant-handled recurring payments are functioning normally," the company said in a statement. Merchant-handled payments are when the merchant submits a request for payment on the day of the recurring period, a burden that services such as recurring payments processing are designed to avoid.
Google Checkout has been around since 2006. Designed in part as a competitor to PayPal and Bill Me Later--the far-more common online payment processors--Google Checkout offer Internet merchants the ability to accept payments online without having to invest time and money into building and maintaining their own payment processing system, in exchange for a cut of each transaction.
That's a familiar strategy at Google, which offers budding application developers hosting resources at Google App Engine and other businesses the ability to bypass more expensive office productivity software with Google Apps. But while Google is quick to respond when problems knock services like Gmail or Google App Engine offline, the delay in responding to problems with Google Checkout has cost it at least one customer.
Datto's problems with Google began when Google surprisingly placed a 15 percent reserve on its account following a review of Datto's finances, which the company insists were in order and evidence of a healthy balance sheet. Payment processors will often hold a portion of all money slated to wind up with the merchant in cases where merchants have a higher-than-normal number of chargebacks or appear to be going through a rough patch as a hedge.
For several days, Datto was unable to reach anyone at Google to confirm that its financial statements had been received as part of that review, which made the company worried because the request for its finances came with a warning that all payments would be stopped if Google didn't receive a response within five business days. Google doesn't offer phone support for Google Checkout; instead it maintains a Web site called the Merchant Help Center for customers to get support and lodge complaints.
Confirmation eventually arrived with the reassurance that the account was working properly and everything was in order, but six days later Google told Datto that it would be holding 15 percent of all payments processed through Google Checkout "based on a recent review of your business," and with no further explanation. At this point, Datto decided to build its own payment processing system and move off Google Checkout.
However, before the new system could be completed the company discovered the issues with recurring payments. "We received no notification whatsoever that the recurring payment system was broken and now we have no guidance as to when it will be fixed," Braband wrote in an e-mail. "In addition to having 15 percent of all Google Checkout disbursements held in a reserve account (completely inaccessible to us) for 90-180 days, we now have no way of collecting our monthly recurring payments."
Google declined to comment on the specific circumstances involving Datto, saying that it does not comment on individual accounts.
In an interview, Braband said Datto was lucky that it had already made so much progress toward developing its own payment processing system but the outage caused problems with customers who thought their data was not being backed up when the payments went awry, and has forced them to re-evaluate their impression of Google in general.
"As a young technology company we always admired Google. Their many free tools and applications are amazing and the support that comes with them is great too. It's disappointing to all of us at Datto Inc. that these fixable occurrences regarding Google's payment processing has tainted our admiration of the people who changed the web, and that Google has chosen to provide no support to the many businesses paying to use Google Checkout," Braband wrote in an e-mail.
And that could be a real problem for Google as it attempts to build paid services around products like Google Apps. Even small businesses are accustomed to developing relationships with their suppliers that can help smooth over the inevitable problems that occur in any business relationship.
Nieman Journalism Lab reported Wednesday that Google has offered its services with micropayments as a possible solution to the woes of the newspaper industry, allowing them to charge news consumers small amounts for individual stories or recurring subscriptions through Google Checkout. Before that happens, some serious problems with Google Checkout and customer support will need to be addressed.
Google is once again running its back-to-school savings promotion that gives anyone a $5 to $10 discount on purchases made at one of the partnered stores using its Checkout service. Online shoppers must spend a certain amount at each store to get the discount, although unlike some previous promotions the discounts are not limited per user or per retailer, meaning you can come back multiple times to get the discount as long as you're hitting the minimum.
The much more interesting story is how well Microsoft's Live Search cash back program seems to have been going since its launch just a few months ago. Its varying percentage has kept online shoppers glued to Microsoft's tracking site. Meanwhile, deal hunting sites like Fatwallet and Slickdeals have had forum threads with post counts in the high hundreds detailing successes and failures using Microsoft's system at various retailers.
What's surprising is how much overlap there is between some of these stores that are vying for the attention. For instance, buying something on Drugstore.com using Google Checkout will only get you $5 back from Google, while Microsoft is currently taking 20 percent off your entire order--a number that could change rapidly depending on the retailer's agreement with Microsoft. In either case, the winners are the savvy consumers who have managed to work the system to get big discounts while the two companies scramble to get the most attention.
Amazon.com quietly unveiled on Tuesday new online-payment services it will offer to other online merchants--a move that puts it in direct competition with eBay's PayPal and Google's Google checkout.
The Seattle-based e-tailer describes Checkout by Amazon as a "complete checkout solution," with features such as Amazon's "one-click" payment option and tools for managing shipping charges, sales tax, and promotions. Google introduced a similar online payment processing system called Google Checkout in 2006, but analysts say it has been slow to catch on with merchants and consumers.
Amazon also unveiled Amazon Simple Pay, a service that allows consumers to use their Amazon account information to pay for purchases on other Web sites. However, as a competitor of PayPal, it's unlikely that Simple Pay will be accepted for purchases on eBay. In 2006, eBay banned its customers from using Google Checkout, according to its accepted payments policy.
Google won't say who's behind it (um, Google, maybe?), but more than 50 merchants using the Google Checkout service for online payments are offering $10 discounts this summer.
Google mentioned the promotion on its Google Checkout blog on Wednesday.
The promotion applies to purchases of $60 or more from participating retailers. That includes better-known outfits such as Buy.com and TigerDirect.com as well as niche sites such as YoYoCrazy.com, Beefjerky.com, PondDeals, and MyHipHopBling.com.
Google Checkout's most obvious competitor is eBay's PayPal service, although the services aren't identical.
The days of PayPal's dominance over casual payments online are changing rapidly. A little over a year ago, Google unveiled its Checkout service, which has become an increasingly popular way to purchase items from various online retailers using a single account. Today, Amazon.com is unveiling its own payment program that lets Amazon.com users purchase items or services using their Amazon.com account credentials and billing information.
The new program is called "Flexible Payment Service", or FPS, and is launching with an invite-only API for developers who want to integrate the new payment service. What does this mean to you, the user? If you've got an Amazon.com account, you won't have to create a special log-in or give up your personal information to participating sites in order to make a purchase. Considering how many users Amazon.com has, and the one-click nature of its Web-shopping model, this is kind of a big deal.
Of course, this doesn't come free. While there are no start-up charges for users or sites, Amazon collects a small fee for each transaction, from purchases as small, or smaller than $.01. The rates are listed on the FPS info page, and from the looks of things seem like a better deal for smaller transactions when compared to Google Checkout and PayPal.
One of the first sites out the gate with Amazon FPS integration is FreshBooks, an invoicing service we covered last year. Expect to see many others in the coming months as Amazon opens up the beta.
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