Sonos has been a leader in the world of wireless speakers and smart music for many years. Its speakers work together to form a seamless sound solution throughout the home. Though desirable, they are not cheap, so the announcement last week that many of the legacy models will no longer receive updates was met with displeasure by customers. Sonos underestimated the strength of the response, which saw its shares suffer, and a huge amount of negativity on social media.
Having invested in several pieces of Sonos equipment, this was a story we watched develop with interest!
So what was happening?
- Older equipment will no longer receive software updates or developments. These items were sold between 2006 and 2015.
- A ‘trade-up’ discount was offered, giving a 30% discount against new kit if the old items were traded in.
On January 23rd the CEO, Patrick Spence, issued an apology to affected customers.
It’s a challenge for Sonos to maintain older technologies alongside newer kit, but the USP of their offer was always the integration between different pieces of kit. It was this integration and the longevity of the older pieces of equipment that was being threatened. Many of these pieces of kit were expensive to purchase, and had been billed at that point as being likely to last for many years into the future.
The letter from Spence addresses this, and makes assurances that when new software updates end, there will be a solution that will enable the integration to continue and for the legacy items to continue as part of an integrated system.
What went wrong?
It’s surprising that a company the size of Sonos didn’t have a clearer idea of how the original announcement was likely to be received. However, once the depth of feeling was clear, the response was good.
- Clear decisions were made as to how to reduce the impact on existing customers.
- These decisions were communicated promptly and clearly. We received an email including the letter, as well as having seen it online, across social media and the Sonos Blog.
- Spence’s letter was clear and conciliatory. In particular the final paragraph accepted that they got it wrong and made it clear that the company realises the impact on trust.
We all know that things will go wrong. Bad decisions are made by humans, whether they run a small business with just one person, or huge companies.
Whatever size the business, the most important thing to remember is how to deal with things when, not if, those things go wrong.
It’s a very good reminder for any business owner that it’s how you deal with things when they go wrong that will make the biggest difference to your long-term relationship with your customers. Putting yourself into the shoes of your customer when dealing with the fall-out will help significantly.
Only time will tell whether Sonos recovers fully from this, but the early indications are promising.