Chapter Three – The final part in our Consumer Awareness Series
Most of us have already heard the used-car-sales pitch about the little old lady, who only drove the car to church on Sundays. If so, then you might fancy yourself an old pro at spotting fraud… But I guarantee you that you’re not.
Okay, so maybe you can spot a lie, but how are you at forensic, psychological marketing and magic tricks? Not too good? Well you better get good, because that’s what you’re up against.
By design, deception is much more difficult to catch today. Specialty stores are almost gone, and “Big-Box” stores have taken over… So why does that matter?
Because if you go to a tool store and buy three wrenches, you’re more likely to catch a pricing error, than if you go to Walmart and load two carts with wrenches, deli meats, work boots, HBA, home goods, back-to-school supplies, and pet goldfish.
I can remember the first time that I became fully aware of strategic marketing and the deceptive sales tricks that were taking place in open sight.
The Big Box Scamola
I was wandering around Target and I came across their video game section. They were broken down into two categories; Arcade Classics and New Releases. Classics were $20 (and in a bin), New Releases were $70 (and locked in a case).
I saw a hot title in the classic bin, so I threw it in the cart and went about my business… I went through the checkout, got my total, and it sounded a bit high. I checked the receipt a few times, found out that the game wasn’t $20, it was $70! There was a growing-impatient-crowd in line behind me, so I felt pressured to buy it anyway.
When I later reflected on what had occurred, it struck me…
“Everyone in here is probably buying at least 20 items and piling them into the cart. Then they get up to the register; there are 25 registers, but only 3 of them are open. The lines are long, so everyone is forced to wait, made impatient, and desperate to get out of the store”.
Most people never realize that they just got ripped off, and only a few of the ones who do, would ever be inclined to do anything about it”.
Every time that I returned to the store, I checked for the same trick, and I found it every time… So I started looking for it everywhere else, and I found it everywhere else.
Whenever standing in line at Home Depot; I found that all of the impulse items were strategically priced below $5. I’d pick out the coolest item that I could find, but it never seemed to have a price on it. Naturally, I’d assume that it was similarly priced to the items around it. But when I’d run it through checkout, and it was always priced 2-3 times higher.
Customers are always on their toes when they’re buying a big ticket item, but they completely let their guard down when they’re buying trinkets, and that’s what the sellers are banking on.
You’re not going to get ripped off on a $300 TV, you’re more likely to get tricked out of a buck. Why? Because when I sell you a $300 TV; I have to design a TV, build it, package it, ship it, store it, inventory it, advertise it, sell it, ring it up, and put it in your car. That’s an investment, which returns a very small profit in a competitive market…
But if I trick you out of a buck, that’s a pure profit.
Consider the fact that most consumers wouldn’t waste their time arguing over a buck, and that 5,000 customers a day visit the Big-Box stores. If you took $1 from half of them, that would be $75,000 profit each month.
To put things into perspective, a store would have to sell about 7,000 TV’s to make the same money.
The Shipping and Handling Shamu
Watching an infomercial one night, they went on and on about how their product was the Be-All-End-All, and included a satisfaction guarantee. Then they announced…
“And if you act now, we’ll throw in a second one for FREE! (Just pay separate processing).”
Now I’m thinking to myself… How could it be? How can they give stuff away… and how can they guarantee junk, which will just wind up getting returned?
First, they price it so low that most people won’t bother to return it.
Second, since the majority of the profit is in the separate processing, shipping, and handling, the seller still profits big by the few who go through the agg of returning it.
The “Would you like to Donate” Dickover
One of my all time favorite scams is the sympathy scam.
Most consumers see this one regularly, but they never question it, because the topics are so taboo, that an ethics violation seems unfathomable.
I see it on Facebook every day… A tug-on-your-heart-string tale of cancer, abuse, suicide, animal cruelty… Inevitably followed by the phrase…
I’d like to see how many of my friends will post this, but I know that they won’t. So for those of you that are my TRUE friends, please share this and then type “Done”.
It’s impossible to believe that anyone would use such devastating topics in a scam… But do you really think that someone who’s lacking any ethics, has a line that they won’t cross?
When shopping at Pet Smart one day…
After standing in line with an 80lb bag of cat food for 5 minutes,
I get up to the “single-open-register”. The cashier asks me “would you like to donate $5 to save animals that will be killed if you don’t?”.
I look behind me at the other customers, who are all giving me the beady-eyed “You better do it jack-ass-or-else” look. So I do… And then I wonder, what the Hell, how can this be acceptable?
I started noticing that a lot of other stores were pulling the same stunt, so I sat down and figured it out.
The next time that I returned the store, I get up to the cashier, and she asks the same question. This time I say “NOPE!”. I then turned to the line behind me and said…
“Why would I make a donation through the store, and allow them to get the credit for my money? If I decide to donate, I’ll do it on my own”.
This time, instead of giving me the stink eye… the crowd was enlightened. The store is using your fear of embarrassment by asking you this question when you’re on center stage. Turn the tables on them and enlighten the crowd to the scam at hand.
These stores collect your money, and then write a deductible check to charity at the end of the year for 3 Million dollars. They get treated like royalty… You get sand kicked in your face.
The Unobtainable Warranty Woes
One of my uncontrollable passions in life. I was always a Bosch and Dewalt man, but years ago, a buddy tells me… Buy Ridgid brand tools, because they give you a lifetime warranty.
Set in my ways and loyal to the core… I have a hard time making the leap, but I finally do, and I’m a pretty happy customer as a result.
But I get home and discover that I have to go through a fairly involved registration process to validate the warranty… It takes a while to do it, and then a month to confirm it, and then the confirmation never comes.
Ever the diligent consumer, I follow up, repeatedly, and after a few weeks, I reach someone at TTi Headquarters. TTi… or Techtronic Industries, is the company that owns;
- Ridgid Tools
- Milwaukee Tools
- Dirt Devil
I explain to them that my registration never works, and they fix them for me, so I’m a happy customer again.
As with most Tradesmen, because I’m so fanatical about brand loyalty, I sell all of my other tools, and I replace them with Ridgid Brand.
In fact, I even go so far as to “not buy” a tool unless Ridgid makes it, and I become the company’s staunchest walking advertisement.
After buying over 100 tools, the registration process never works as it should, which requires me to email them after every single purchase, and then spend weeks tracking the registration.
Four years later, one of my TTi tools breaks and I need to get it replaced. I figure that my hardcore loyalty has probably earned me some serious cred with them by now, so I’m excited to call up and get my warranty service.
When I do, they ask for a receipt, which is understandable, however…
I explain to the woman, I buy 200 tools every year, and shop at Home Depot twice a week. Your request will require me to sort through thousands of receipts in order to replace a $30 tool.
TTi could’ve cared less, and they found nothing unusual about having an essentially unobtainable warranty… Why essentially? Because if you buy a hammer and then carry the receipt in your pocket, every day for the rest of your life… Then you’re covered.
If I was a Consumer Protection Investigator, and I had an intimate and loyal relationship with this company… and they’re ignoring me, how are they going to treat you?
I escalated my concerns through the company, and I was shunned at every turn. The reps were rude, short, and unconcerned about what I was going through… So I went online and found their Chief Executive Director, Joseph Galli.
His Bio read like St Jude, so I figured that he’d flip when he found out how poorly I was treated. I confidently sent him a certified letter and I awaited his response, but it never came.
For all of my effort, loyalty, and dedication, they didn’t even feel that I’d earned a response.
But in the end… They need me, and I don’t need them.
I started doing some research, and TTI’s own employees post horror stories about their ethics and tactics, so now I’m and educated consumer.
I know what they own, so I know what to avoid now, and most importantly… whether it be on the internet, or during the classes that I teach to the trade unions, I spread the word.
This is your only defense against a corporation.
Todays market is a heartless place. We shop every day, and we’re forced to put faith in merchants, based on the hope that they’ll honor us when we need service, as we did them when they needed our money.
Do your homework… Take names, business cards, pictures… Protect yourself… Expect the worst… Stick to your guns…
Instead of using your $800 PC to hang out on Facebook looking at fart jokes, use it to spread the word about the good, the bad, and the ugly.
If you don’t do your part, then don’t complain when no one else does either.