The Consumer Affairs Committee's goal is to offer senior management fair and balance evaluations of any new programs or company practices that affect our customers and in particular any changes that might negatively impact our company's reputation for customer satisfaction. We have carefully evaluated the "Jumpstart" proposal by Sandra Girarda involving a one month promotion available only to new subscribers in which we would cur the basic subscription rate in half. One advantage of this proposal is that Sandra anticipates a dramatic increase in new subscribers and the possibility that many of them would purchase services in addition to basic cable where much of our profits are generated.
There are several disadvantages and risks to this idea. The most obvious is that it will alienate long term customers who will be "rewarded" for their loyalty to this company by paying double what a new customer would be charged for basic cable programming. Another issue to consider is the ethics of not informing these new customers that they can renew after one year at a lower monthly rate, but only if they call to request the lower rates. In other words, if they forget to ask their monthly invoice will more than double at the end of the first year.
The Committee believes that the most pressing of these problems involves the potential backlash involving our existing customers. It would be difficult to look an existing customer in the eye and explain to them why they must pay twice as much as new customers for the same basic service. If this new idea were to become operational, we believe there will be a dramatic increase in the number of complaints and our customer support team is going to need help from the marketing department in scripting a response to what might become an avalanche of complaints.
Given the complexity of this issue, the Committee is reluctant to offer any specific recommendations. We hope that this memo has outli...