11 May 2015

Bad Business Practice, or Why I Won't Give Another Penny of Business to Intuit

Call it a cautionary tale. According to their Customer Service people, I have had “ongoing issues” with QuickBooks. More precisely, my “issues” are with Intuit and its business practices. Here’s why businesses must be cognizant of the effects their business models and strategies have on their customers. And, here’s why they must reality-check whether their nominal company values actually inform their in-use business practices or whether they are only so much feel-good window dressing.

I’ve been a QuickBooks user for over fifteen years, having upgraded – that is, repurchased – the program twice in that period. The software works for me, and like most software, it’s “easy to use” mostly because I’m used to it. I had to turn on payroll for a relatively short period of time using the 2014 edition, and much to my surprise and delight, the program told me that because of the particular edition I bought, I could use payroll for free. Yes, that would indeed be consistent with one of Intuit’s operating values, “Delight Customers.” Imagine my undelighted surprise when, six weeks later, I received a charge on my credit card for $31.64, the subscription price of the “free” payroll offer. The nice customer service folk informed me, essentially, that there ain’t no such thing as a free payroll. Oh, by the way, Intuit’s number one operating value is “Integrity without Compromise.” But we’ve only just begun to scratch the surface of what Intuit considers “Integrity.”

I put up with the payroll charge primarily because any equivalent payroll service would charge about that amount or more, and I preferred to manage things myself, as I’ve done over more than a decade. The next surprise (and oh how I wish Intuit could be more like the old Holiday Inn—the brand’s motto is about six paragraphs from the end of the article) was when the payroll stopped working because the payroll tables were apparently out of date. Now what good is a subscription service when updated payroll tables aren’t provided, I asked myself. Certainly this must be some minor error or slip-up on the part of the update system. After all, updating payroll tables is a simple matter of substituting one set of deduction factors for government remittances with another, based on the then-current rate of taxation, Canada Pension Plan, and Employment Insurance.

A call to Intuit support informed me that, no, it wasn’t a mistake. Intuit had DELIBERATELY chosen not to update these parameters in the 2014 edition, forcing all users to upgrade to the 2015 edition. And, by the way, the cost of doing so would increase my monthly billing from about $360 per year to OVER $600 PER YEAR! Yes, the capitalization of that last sentence reflects my utter shock, horror, and abject anger over that little piece of “Integrity.” Are we delighted yet?!

I screamed bloody murder. The only other businesses that I know of who hook their customers for free, then start charging, and once they are firmly ensconced in using the product for which the cost of leaving is relatively high (as it is for an accounting system) are the Mafia and drug dealers. Call it the Intuit “Corleone & Escobar” Business Model. Big Tobacco is only slightly less egregious, since theirs relies on a physical addiction.

My screaming resulted in them offering me a “discount” back to (only slightly more than) what I was paying. I discontinued using payroll in January and, after tax season when I had to produce and submit T4s, I called to cancel the subscription license. I only needed the accounting function, and therefore no longer had to rely on the non-free, free payroll service. Imagine my surprise (again) when they told me that, despite the fact that I had already paid them nearly double what the software would have cost in the store had I bought it fresh, I still “owed” them nearly $200 more for a license that I hadn’t wanted and didn’t need were it not for THEIR choice not to provide payroll deduction factors for the 2014 version.

I could easily have walked into Staples and bought a version of QuickBooks 2015 for $99, installed it fresh, and been done. But Intuit’s egregious business practices, arrogance, and total tone deafness with respect to customers caused me to do something else: I bought a copy of their competitor’s software (for more than double what QB would have cost), went through the hassle of converting my accounting, and am climbing up the learning curve of new software, because I will never give another penny of business to Intuit. Additionally, even though I’ve used QuickTax (now TurboTax) for on the order of twenty years, I will never again do that either, choosing instead to use a competing product.

I’m told by a former Intuit insider that QuickBooks, by far and away the market-leader in the accounting software market, has been enjoying a steady, quarter-by-quarter decline in its business over the past number of years. Presumably, more and more users are reaching the point of “enough is enough.” The strategy of “lock-in” – that is, create an excessively high barrier to exit in order to preserve captured customers – may be a winning strategy when ethical business practices are a distant also-ran in decision criteria. However, from a point of view that is cognizant of today’s reality of interconnected ecosystems and “doing good to do well,” it cannot be sustainable. Nor can such practices be sustained, sanctioned, or supported.

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