The normally laser-focused Pat Kitano showed me yesterday that it’s actually okay to write the occasional off-topic post. So here’s mine: a word of warning to you unsuspecting consumers who might be considering purchasing a Gateway (soon to be Acer) product.

The customer experience when you’re buying something from Gateway is brilliant. Smooth, efficient, friendly – my representative had me whipping out my credit card in a jiffy.

Then come...the problems.

My beautiful matte black widescreen 22” LCD monitor looked groovy coming out of the box, but once I plugged it the image flickered and flashed so badly that I thought it was going to give me an epileptic seizure.

Then comes...the real fun part.

I won’t bore you with the details (and they're many), but suffice to say that I spent multiple hours on hold waiting for someone from the returns department to talk to me. And I'd already spent multiple hours on the technical service chat line, where I was instructed to download all manner of patches and software in a futile effort to fix the problem.

This was all, well, pretty annoying. With every human being that I managed to speak with (all of them obstructive and unhelpful) I emphasized that I didn’t want an exchange (I wanted my money back) and that I didn’t expect to be charged a restocking fee. I was assured that I wouldn't.

Then I got my credit card statement. By now most of you see this coming. Bam: $50 restocking fee.

Another phone call. Another period on hold (this time shorter). And I’m finally curtly informed that Gateway reserves the right to charged me a 15% restocking fee, and they’re not going to waive it regardless of what any Gateway representative had previously told me. Case closed. And if I don’t like it then I can take the case to arbitration. Bye.

Lesson learned: be careful when doing business with a company that’s in its last death throes. Gateway, once an innovative dot.com darling, has seen its stock price collapse from a high of $84 down to the current level of $1.87. Gateway has finally thrown in the towel and is being acquired by Taiwan based Acer.

A note of caution to Acer: an embattled company like Gateway often manages to acquire some dysfunctional cultural traits that are difficult to root out and fix. In this case it’s a clear pattern professional front-office hospitality designed to lure orders followed by a phalanx of curt back-office trolls brandishing consumer-unfriendly policies to obstruct any poor sap (like me) who’s trying to return one of Gateway’s lemons.

This, clearly, is a deliberate strategy.  Had I suffered a single long hold time or had to deal with one rude return agent I could understand - maybe someone was having a bad day.  But when it consistently happens over and over...well that's no coincidence (especially compared with the cheery efficient folks who took my order.)

This is a penny-wise but dollar-foolish method of maximizing revenue. Yeah they’re going to keep my fifty bucks (which I suppose will help their bottom line) but believe me I’m going to tell anyone who will listen that they need to avoid Gateway (and Acer) products like the plague.

Acer will have some cultural problems to root out when they take the reins; I hope for their sake that they built this into the acquisition price.

Hudson Sangree with the Sacramento Bee recent wrote a story about a customer who decided to take Gateway to court over a defective computer and Gateway's subsequent customer service stonewalling.  I exchanged emails with Hudson and he indicated that he's received a lot of contacts from Gateway customers who have had similar experiences. 

Ironically, the plaintiff in the case, Dennis Sheehan, describes himself as "a retired real estate investor".  It's clear that real estate professionals need computers...so hey maybe this post wasn't so off-topic after all. 

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Epilogue [October 7th]: Subsequent to the events above I issued a formal complaint to American Express, the card I used for the purchase.  They temporarily suspended the $50 and promised to investigate with Gateway.  Today I received a letter indicating that American Express has issued a credit for $50 to my account to resolve the complaint.

This feels like a victory of sorts, I suppose, although I suspect that American Express is eating the cost.  However, American Express is a $72 billion company (market captialization) whereas Gateway is a $700 million company - around 1% of American Express' size.  As as a pattern of complaints develops concerning Gateway, customer-focused companies like American Express will start to reevaluate their relationship with the offending vendor. 

The moral: consumers who suffer a blatantly abusive experience with a vendor should look to their credit card company for recourse if dealing with the vendor directly yields no success.