US Corporations – a conspiracy against consumers

US Corporations – a conspiracy against consumers…
I think that US consumers are pretty naïve. Anybody can fool us, take us for a ride on the bus of “This is our corporate policy” or “These are our procedures”. I was planning to write about this ever since I had my first nasty interaction and finally got down to doing it today. These are some facts you need to know. Ask me for details if you want to know more.

- Comcast, the leading cable & internet service provider in the US, offers service suspension for a small fee per month if you are away from your home and not using their services. However, they offer this only during vacations and that, according to their corporate policy, starts from October. Initially I thought I had not got it right, but when the lady on the other side repeated it, I was taken aback. So Comcast decides when people should be taking their vacations? They should then be in the travel business.

- Comcast very often offers free installation. However, apart from myself I know at least two people (and I have not gone checking for them – I knew this accidentally) who when they got their first bill, saw the installation charge. You have to call back so that they could reverse it in the next billing cycle. In isolation these may be co-incidences, but if we put these events together, I smell conspiracy. I will not be surprised if this is planned - meaning claim to offer free installations and charge them in the invoice. If the customer calls, refund the charge or else pocket it.

- When you walk into an AT&T / Cingular’s store, they are ready to sell you anything you want (or may not want). But if you have a problem with the service, chances are very high that they will sweetly say that it can only be handled at their customer service center. Sounds unfair. Why can’t they have a couple of desks to resolve queries?

- Again, and this is a classic case for a class action suit. Do you know that even if you talked for 55 seconds or 1.57 seconds, you will be charged for 2 and 3 minutes respectively at AT&T/Cingular? Meaning, if it closer to 55 seconds or so, you will be charged for the next minute? I checked it with them and this honest fellow on the other side of the phone admits that their ‘system’ registers the call after a few seconds by which time if the next minute has started, they will bill you for that minute. How conveniently designed is this system?

- Still with AT&T. Do you know that their famous network map with those orange shades showing their network coverage across the US is flawed? Meaning they are not networked in places where they show they are. I screamed this out at one of their stores and their executives as well as their security personnel (why does an AT&T store need a security personnel?) rushed towards me. It was a funny sight. They wanted me to calm down as they were afraid that their other prospects may run away.

- Do you know that if you are a prepaid customer, you can carry forward your unused dollars to the next month. However, if they are unable to charge your card due to some reason, they will not adjust these carry forward dollars to the current billing cycle. You simply lose it. Logically and honestly speaking, these are money you paid in advance and did not use, so this should be in your balance. But this is not the case, they will not adjust it or even give you a call to tell you why the transaction failed or check with you. They will simply disconnect your service.

- Credit rating agencies make millions feel handicapped here in the US. You need to have a credit line to improve your credit rating/score and for that you need to have a credit card or need to take a loan. If you don’t have a credit history, you can get denied a credit card many times before you get your first one. So how can you build a history if the system does not allow you to start? You could take a loan but the terms would kill you. So an average starter would have a more than an average chance to default as his terms would be steep. Other important pointers like car ownership, bank CDs, stable job and a decent salary do not count. How distorted is this system if it does not allow people to move up? And we, the consumers of America, live with this.

- Healthcare. Next time you go to see a doc, see carefully what you are signing. Chances are that the invoice has items built up that you did not use. This they do so that they can negotiate with the insurance companies. Consumers do not pay attention as their insurance pays this (there is a whole write upon this which I will put up in the next few days), but it matters to us collectively as it increases premiums in the long term.

- Take electricity. General Electric sends this mailer every month to move to renewable energy. It argues, that though costs are relatively high, it promotes sustainability and makes us feel responsible citizens. If that is the real case, can someone please ask GE why they send mailers to millions of homes every month, consuming tons of rims of paper? That sure is not a sign of sustainable marketing? Why can’t they promote it thru web/TV ads if they are so bothered?

- I hate Vista but I have no choice as 19 out of 20 laptops come with it. Why? Because there is just one Microsoft. How do regulators allow it even if they allowed a Microsoft to become a monopoly, I am surprised they cannot regulate this part that every laptop buyer should have the choice of application he wants to use, rather than it being thrust on him. If Vista is good, people will eventually move. Why force them?

- Credit cards. These guys are probably the smartest. They have now started sending these dummy cards with a covering letter to you saying your card is ‘pre-approved’. This is unethical as it is not pre-approved as we really understand in terms of credit cards. It would still go thru all checks and scrutiny before it is actually approved. The gimmick works as vulnerable consumers sign in. Even if 5% did, it’s a great ROI for direct mailers.

- Talk about mail in rebates. For those who don’t know, mail-in rebates work this way. As a buyer, at the time of purchase, you are supposed to pay the full price and then mail the receipt along with another form to the mail in address and wait for the rebate check to come to you in 2-3 months. On many occasions even when you have sent all information, the check never comes. If you want to follow-up, then you have to hunt for the copy of the receipt, that is if you were wise enough to keep a copy. Then you follow-up on the phone and wait. Most customers do not take such pains, especially when the rebate value is small. Can someone please ask, why mail in? Why can’t we just get the discount at the time of purchase? The answer is negative as the intentions are immoral. Some of the marketers explain that they want the database. Well, if they do, why don’t they just have them fill up the form at the time of purchase and collect the rebate? The real reason is that they want you to forget about it. It straight away goes to the bottom-line if you forget. Most consumers misplace the receipts or forget about it. These are pure profits to them and ill intended.

- Prices for almost any product category in the US have a 9 in it. It is called psychological pricing in marketing books. It is used in many countries by many marketers. But in the US, it is used for almost every product that you want to buy. Notice the price of products next time you visit a grocery store. $1.89, $13.49, $5.79. Products could be diapers, milk, beer, carrots, detergents, cars, mobile phones, just about anything. The best example here is the price of gas. Gas is priced as 2.899/10. It really makes me laugh. This is another sign that this works with the American customers and that they are gullible.

- Take the Sale/Discount idiotism that goes on. As a customer you will never know if you got a good deal as there is rarely an original price printed on the pack. Most of the times it is bar-coded. Consider this. A Nike shoe sells at Sears at $49.99 with a 20% discount. Is this a good deal? As a customer you will never know as you don’t know what the real retail price is. It may be $40 and the store has jacked it up and offering a discount of the same value. So when consumers tell me that they bought this product at 50% discount or 70% discount, I really pity them. Further, some stores have apparently everything on ‘SALE’. So all price is mentioned under a SALE placard. And what is really on SALE is under clearance. I sometimes wonder telling the store manager that we know that you are here to ‘sell’ so you don’t have to say ‘SALE’ everywhere.

You look almost anywhere and you smell a rat. American consumers are being fooled time and again. There is no regulation and whatever is there hardly helps the consumer as it is at such a macro level.

The solutions

span style="font-size:85%;">There are several solutions. Some of them may be practical, others may be not. But at least let’s start a debate and work out a solution together.

· The market should offer more room for competition. AT&T should not have been allowed to buy Cingular. Yahoo should not be allowed to sell to Microsoft or Google. There should be more options for cable, internet, electricity, almost any service. Competition is good for consumers. It keeps corporations on their toes and brings prices down. They would listen to you and you will have options.

· I am sick of AT&T, you may be of Verizon but we cannot change our service as our phone numbers are with everybody we know. If it becomes mandatory that AT&T will have to forward all my calls to my new number after a message that says that the subscriber has a new number, it will be a great boost to the consumers. AT&T can charge a small fee like $5 (4.99 if you wish) per month for this. It costs them nothing but allows consumers to move swiftly from one operator to the other.

· Mail-in rebates should be banned. Or if that is not possible, have them give you the money not in 3 months but 3 weeks. All stores offering mail-in rebates should have a mail-in box and they should encourage customers to fill the form there itself and drop in the mail box so that consumers do not lose the receipts.

· Organizations promoting sustainability as a marketing and PR gimmick should be taken to task. Everyone seems to be riding this green wave most of which is unethical and customers should be aware so that they can distinguish real from fictitious. Organizations like Energy star or equivalent could take a lead here.

· Prices for most products should have something like a maximum retail price. Bar-coding does not help consumers. The same Nike shoe can sell at Nordstorm at $49.99 and at Sears at $42.99 but customers should know what is the maximum retail price fixed for that shoe by Nike which can help them identify if this is a sale, discount or clearance product.

Lets all move on this together.