Apple's Rep: Here a Bruise, There a Bruise…

Is The Jerk's service keeping up with his hypergrowth? Some customers don't think so

For Apple there may be a downside to success. Sales of the Cupertino (Calif.) company's Macintosh machines are growing three times as fast as the overall PC market. Its iPod music player is burying the competition. And the stylish iPhone is setting the wireless industry on its head. But as Apple pulls in millions more customers with different kinds of products, it's getting harder to keep them all happy.

Apple Inc. still tops all of the big measures of computer-customer service. But there are signs that it is vulnerable to the service struggles of other big companies. A widely watched study of customer satisfaction, released in August by the University of Michigan, showed Apple slipping 4 points from last year's score, to 79 on a 100-point scale. That still leads the industry, but it's the company's first decline since 2001.

For years, the computer maker survived on its core of tech-savvy fanatics clustered in fields such as education and design. They were intensely loyal and thrilled to CEO Steven P. Jobs' unveiling of the smallest tweak in the Mac or iPod lineups. If there was an occasional glitch, it was the price of membership in the club. Apple products "bring so much joy that even if there's a snafu, you tend to be more forgiving," says longtime customer Nigel Ashton, a photographer in Lawrenceville, Ga.

Today, Apple is selling huge volumes of products to a much wider, and perhaps less patient, audience. The iPod, starting at just $79, has put its name in the hands of millions of mainstream consumers, many of whom, analysts say, have gone on to buy Macs and iPhones. In the most recent quarter, ended on June 30, Apple sold 1.76 million Macs, up 33% from the prior year. That gave it 5.6% of the U.S. PC market, up from 4.8%, says researcher IDC.

Those new customers, lured by the company's sterling reputation and marketing power, may feel deceived when they encounter bugs. Catherine Temple, a Boonton (N.J.) homemaker and musician, had heard all sorts of great buzz about Macs. So she drove 10 miles to an Apple store last April and plunked down about $4,000 for an iMac. Three months later, the hard drive failed, sending her back to the store with the PC for a replacement part. Days later, Apple had to fix the logic board and some memory chips. Then it discovered the optical drive wasn't working right. Besides the legwork, Temple says she waited days for replies to faxes and e-mails and made long calls to the help desk; one of them ate up 90 minutes. Her experience with Apple "left a bad taste in my mouth," says Temple. "I have no confidence in them."

Some problems reflect the changing composition of the company's product mix. Laptops far outsell Apple desktops, and analysts point out that portable machines get more wear and tear as users tote them around. Also, the more tasks a gadget handles, the more that can go awry--and the more service reps have to cover. The original iPod plays music. The iPhone plays music, makes calls, stores and displays photos, and connects to the Internet.

Plus, not all those customers live close enough to get the vaunted high-touch service from an Apple store. In February, Michael Levin, a graduate student in Lubbock, Tex., bought a MacBook laptop. Several times it cracked on the area near its built-in mouse. But with no nearby Apple store, Levin had to make lengthy calls to Apple reps, who initially balked and insisted he must have dropped the machine before they agreed to fix it. "That makes it easier for them to say no," says Levin. "I'm this nameless, faceless customer."

http://www.businessweek.com/magazine/content/07_43/b4055070.htm