What TurboTax is missing (and what we shouldn’t)

This year TurboTax changed some of the available features with their desktop software. The rollout didn’t go so well. Essentially they reduced the functionality of certain levels of the software, requiring customers to upgrade to a more expensive version to get those features back.  Many people purchased the same software that they have always used to do their taxes, but found out that the forms they needed were no longer included…and that it would require a costly upgrade to finish their taxes.

Not surprisingly, people hated it.

And they responded by taking their complaints to the TurboTax Facebook page and barraging Amazon with one-star customer reviews. And TurboTax listened.


They first issued an apology explaining that the reason they made the change was to make “the product experience consistent” for all their offerings. They also offered a $25 rebate if you were a returning customer. They also explained why they made the changed. Turns out that they’d already made a similar move last year to their online software – apparently without the same negative reaction.

Then Intuit CEO Brad Smith offered a second apology on LinkedIn. But that still didn’t calm the storm. So then yesterday, they issued a third apology via email and included the $25 rebate plus a free upgrade (if you were a returning customer.) Plus they promised to change everything back to the way it was – next year.

What I find fascinating about each of the apologies and the messaging from TurboTax is that they view this primarily as a “failure to communicate.” Brad Smith’s LinkedIn apology offers three lessons that he hopes to pass on to you and me.

  1. Proactively engage in dialogue.
  2. Ease customers through a transition.
  3. Respond when you hear the questions, and don’t wait until you have all of the answers.

I don’t disagree that those are appropriate responses to a brewing PR nightmare, but to me, they all miss the mark. TurboTax isn’t just missing a few forms, or an effective way to communicate change…what TurboTax is missing is one of the most fundamental rules of running a business. The three most important lessons that TurboTax could pass along to you and me are these:

  1. Always put the customer first.
  2. When in doubt, do #1.
  3. There are no other rules.

Companies that put their customers first don’t REDUCE features to their products…no matter how expertly the change is communicated or how gently I’m eased through the transition. Companies that put customers first ADD features! They do MORE than I expect. They surprise me with EXTRA functionality. I’m actually stunned that none of this is being realized at TurboTax. (H&R Block seems to have realized this, since they offered FREE software to any disgruntled TurboTax customer that wanted to switch.) To me, it’s the fundamental lesson that we can learn…focus our efforts on meeting our customers’ needs, rather than squeezing extra fees out of them.

How could TurboTax do this? Here’s a few crazy ideas…

  1. How about connecting with me via LinkedIn or Facebook so that the software already know where I worked all year and how many kids lived with me?
  2. It would be great if I could just scan all my W-2’s, 1099-INT’s and 1098’s into one big blob, the software scans it and fills in 98% of the forms right off the bat.
  3. Partner with Consumer Reports to give me a 60 day free trial so I can wisely spend my tax return.
  4. Take all the mint.com (personal) and Quickbooks (business) data that you already have and not only do my taxes, but also provide some tailored financial planning info.
  5. Offer tax advice throughout the year…that charitable contribution I just wrote – how much did that save me in taxes?

Maybe none of those ideas are viable (although I really think some of them are) but the idea is, if your company is built around the idea of putting the customer first, THESE are the types of things worth apologizing for. “We’re sorry that the awesome new scan feature had some bugs…we really wanted to make your life as easy as possible and we didn’t get it quite right.” That’s much more palatable then “We just wanted to make all of our software products consistently less helpful.”

So I think the lesson for you and me is not just that people are resistant to change (they are) and that changes in our offerings need to be communicated well (they do). But that we need to always keep our sights firmly aimed at putting our customer’s needs first. Sure…that’ll help keep us from messes like TurboTax is dealing with. But most importantly it means that we’ll be making people’s lives easier, better, happier…no apologies necessary.


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