I had a terribly bad experience with Stamps.com recently.
I regularly mail personal documents to overseas and am frustrated having to go to post office every time. I came across Stamps.com through a web site on November 10. From its front page I found an ideal promotion: $50 free postage, a free scale of $50 value and 29-day risk free trial. Without much hesitation I signed up for the trial and received a welcome email:
"Thank you for signing up for Stamps.com. Your Power Plan account is now active.
===============YOUR PROMOTIONAL OFFER====================
Your account includes: $50.00 free postage
Note: Please use the free postage during your first 30 days. Any unused free postage remaining in your account after 30 days will expire.
============YOUR FREE SCALE & SUPPLIES KIT===============
Your free Digital Scale and Supplies Kit will be shipped right away. But you do not have to wait to receive these items in order to print postage. Log into your Stamps.com account now to print Shipping Labels and Internet Postage.
Your Supplies Kit includes the following:
- Getting Started Guide
- One sheet of NetStamps Labels
- One sheet of Internet Postage Labels
- One sheet of adhesive Shipping Labels
Note: If you do not receive your scale or kit within 10 days, please contact Customer Support. Please note that these items are being sent separately.
=============YOUR STAMPS.COM TRIAL PERIOD================
Take advantage of your 29-Day No Risk Trial.
If you like Stamps.com and wish to continue the service, you do not need to do anything. Your service will continue uninterrupted and fees for the first month will apply.
If you decide that Stamps.com is not right for you, cancel your account before your 29-Day trial ends and you will not be charged for any service fees."
After one day I received an email like this:
"Our records indicate that you recently signed up for the Stamps.com Microsoft Office promotion offered to attendees of the Microsoft Office 2003 launch event.
It has come to our attention that this promotional offer is being widely distributed on the Internet. To make sure that our Microsoft Office promotion remains available to those people it was intended for, we have temporarily put all these accounts on hold."
I immediately replied and said I didn't participate in any Microsoft Office promotion whatsoever and they should honor their promotion on their web site. The email never got response and I found my online account was disabled. The supplie kit and scale never came too.
Now last night, Stamps.com sent me another email:
"We are sorry to see you go!
We are currently processing your request to close your Stamps.com account and have stopped your service as of 12-03-2003.
You will be charged the final service fee for your account within the next 15 to 30 days, and you will receive your final account statement via email at that time. Your account is subject to the full service fee for the current billing cycle."
Hey, I was never treated like a customer in the first place and now you need my money?
The biggest irony: you can still find a $20 free postage, $50 free scale, 29-day risk-free trial on its web site.
I seriously doubt if Stamps.com really wants to enlarge its business. As a publicly traded company (ticker: STMP) it has never earned a dime for investors. Though revenue is up recently, price/revenue ratio is over 10 times and the stock is nowhere cheap. Investors should question whether the company really has a profitable business model in the long run. For now, the only thing that Stamps.com can count on is it's cash pile of $80M+, or around $2 per share. The company is burning $8-10M every year so unfortunately it will still be around for a while. And ironically if it does not put cash into expensive marketing (and by rejecting new customers in my case), it can survive even longer.