Archive for the ‘scams’ Category

Fake Sales: When a Sale Isn’t a Sale

American Consumers love a sale, and retailers know it.  Shoppers love to think that they’re getting a great deal on a product…and retailers are more than happy to tell them what they want to hear, even if it means stretching the truth to make a point.  Fake Sales….they’re everywhere.  Who’s doing it?   Well, it’s easier to identify the retailers that don’t do the take sales.

Fake Sales - The Consumer Team Investigates

Fake Sales – The Consumer Team Investigates

Big retailers love fake sales.   T.J. Maxx and Marshalls were the subject of a Class Action lawsuit charging that the retailer tricked customers into thinking that they were getting a super discounted value because the ‘compare at’ prices on merchandise were so much higher than the sale price.  Kohl’s and Jos. A. Bank have been taken to task for their sales practices.  Even Hobby Lobby, the squeaky clean retailer out of Oklahoma City, has been called out for fake sales.  In fact, in a settlement with the New York Attorney General, Hobby Lobby agreed to pay civil penalties.

To illustrate how much consumer love a sale, let’s consider the case of J.C. Penny.   Several years ago, J.C. Penny decided to abandon sales in favor of an everyday low price strategy.   From a transparency standpoint, everyday low pricing is a more credible way to price products.    However, the customers didn’t like honesty and Penny’s sales tanked.  J.C. Penny ultimately returned to ‘door buster sales’ and their business has improved.   Consumers love sales!

Some lawmakers and consumer advocacy groups believe more laws are needed to protect us from fake sales.   Just put the hammer down on the retailers and they’ll behave, right?   I think we need less government regulation and more consumers that are smart enough to recognize a bad deal.  Being smart starts with understanding the fact that sales are rarely sales….they’re retail promotions designed to drive revenue.  Once you get over the fact that sales aren’t real, then you can start getting good deals.   Then you can start voting with your feet.

The fastest way to identify the lowest price on a product is the online bots that compares prices. Websites such as Bizrate, DealTime, MySimon, Price Grabber and Shopping.com are ‘one stop’ sites for price comparison.  Based on the information you enter into the site, it will search the web for the best deals.

Consumer Team's Pete Thomson: "More than regulations, we need informed consumers to vote with their feet."

Consumer Team’s Pete Thomson on Fake Sales: “Instead of more regulations, we need informed consumers to vote with their feet.”

If you’re in a store, use a scanner app like Red Laser or Scan Life to scan bar codes and find lower prices. Many retailers are price matching if you can show proof of a cheaper price at a competitor.

Consumer Reports recommends using Groupon and Living Social for their discounts and daily deals. Personally, I prefer the bots over the daily deal sites which seem to always send me offers I will never need, such as half-price deals on a Brazilian Bikini Wax.   Some consumers are reporting that Google Daily Deals is a good resource.

Sales aren’t going anywhere.   After all, the American consumer loves and expects them.  But for discerning and educated consumers who understand the marketplace, information is power.  With all the resources available to accurately find the lowest price, sales aren’t needed to get a good deal.

I welcome your comments on this topic.  Email me at pete at myconsumerteam dot com. Below are links to several sources we consulted for this blog post.

http://www.fool.com/investing/general/2015/07/31/this-retail-trick-might-have-claimed-another-victi.aspx

http://www.consumerreports.org/cro/news/2014/06/don-t-be-taken-in-by-fake-sales/index.htm

http://www.consumerreports.org/cro/retail-stores/buying-guide.htm

http://www.consumerreports.org/cro/news/2014/04/advertising-tactics-that-bug-americans-the-most/index.htm

Editor’s Note:  The Consumer Team with Pete Thomson is broadcast Saturdays from 6-8 PM Central on CBS Radio’s 1080 KRLD in Dallas, Texas.

“But Wait There’s More!” 10 Warning Signs of an Advertising Rip Off

As a reformed advertising salesman, I’m all too aware of the tricks, tactics and schemes used by marketers to get you to buy their stuff.    Every day on radio, TV and the internet advertisers use buzzwords that, if you pay attention, can alert you to rip offs.  P.T. Barnum, circus entrepreneur and scam artist in his own right, used to say “There’s a sucker born every minute”.   Don’t be a sucker.   Beware of these 10 warning signs of an advertising rip off.

P.T. Barnum - "There's a sucker born every minute"

P.T. Barnum – “There’s a sucker born every minute”

Hurry! This is a Limited Time Offer!”    What they’re really saying is “we have a ton of this junk to unload so please make call today and help us get rid of it!”   The same logic applies to sales people from any profession.   The minute anyone indicates that you have to buy now or lose the opportunity, disengage from the discussion.

The Next 20 Callers will Receive this Offer!”    This is another version of the “Limited Time” offer above made by marketers who are fully delusional regarding the benefit their product offers.   They’re saying, in effect, our product is so hot, so amazing that we can only give it to the next 20 customers.   When they’re really feeling bold, these hucksters get their commercial production guys to add a digital counter to the upper corner of their television spot that magically counts the number of people who have called in.   That’s right, they’re giving a “live” update on a commercial that was recorded months ago.

Our Product is Free.   Call now!”    Nothing is free.   Marketers making this offer easily make up the difference in ‘shipping and handling’ charges, which is a huge profit center for mail order junk merchants.   I repeat, nothing is free.

Money-Back Guarantee!”   See “Our Product is Free” above.   Shipping and handling are used for this scam too.

This is a Rare Product”    The numismatic coin guys use this all the time.  “We’ve found a rare batch of coins from the era of Theodore Roosevelt!”   Buyer beware.   The only thing that’s rare in this deal is any value to the consumer.   Nothing ‘rare’ or ‘valuable’ is sold via an 800 number.

Spacey's Frank Underwood Character Won't be Fooled by 800 Marketers

Spacey’s Frank Underwood – Speaks Consumer Wisdom

Over 1 Million Products Have Been Sold“:    Sadly, these claims are often true.  (See P.T. Barnum quote above).

Buy Now and We’ll Give You a Second Free“:   Buy One, Get One (BOGO) is the latest tactic being used to fool consumers.   Retailers often mark-up BOGO products just before they’re offered for sale.  Shipping and handling can also be used to hide profits.   Before you fall for this scam, do a search on eBay or Amazon to check the real, competitive price for a product.

Today We’re Taking Calls from States That Begin With the Letters A-L“:    I’m getting sick to my stomach now.   This tactic  came from the same ad agency that dreamed up the digital counter.    I assure you, anyone who can fog a mirror and has a valid credit card will be most welcome.

“Get Your Free Trial Today, Call Now!”:    While there are some legitimate try-it-before-you-buy-it offers, many are dangerous for consumers.   Because the ‘free offer’ requires that you place a credit card ‘on file’,  consumers are required to go through a cancellation process to prevent future charges from hitting their card.  And, to no surprise, the process of cancelling your commitment is often difficult if not impossible to accomplish.   Unless you’re dealing with a well-respected company, it’s best not to sign up for any free trials.   And, generally, 800 line marketers don’t fall into the ‘respected company’ category.

Use of “Amazing”, “Incredible” or “First Ever”:     Using superlatives in describing anything is a red flag.   In fact, in many cases just attach an ‘un-‘ to the beginning of the descriptor and the description will be more accurate.

The Consumer Team Solution…..Vet Your Purchases:   The easiest, most effective way to fight back against scans is to thoroughly vet your purchases.   Get multiple bids for any service related purchases and price-check anything past $30 or so.   Smartphone Apps, such as Red Lazer, are an excellent way to quickly find the lowest price available on a product.   For more information on being a more savvy consumer, join us for The Consumer Team radio program, Saturdays 5-7 PM Central, on 1080 KRLD Radio, Dallas-Ft. Worth.

Frank Underwood, the totally depraved character from House of Cards, does occasionally speak wisdom.   In one episode, when his wife Claire is trying to coax him to use a rowing machine she recently purchased, he said “I refuse to be a slave to anything you order through a toll free number.”    His sleaziness notwithstanding, in this regard, Frank speaks the consumer truth.

Pete Thomson

The Consumer Team

http://www.myconsumerteam.com

 

Wounded Warrior Project & The Shriners Hospitals: A Tale of Two Charities

(DALLAS-FT. WORTH, TX)    Two of the most visible charities in America couldn’t be more differently wired.   To watch their high profile advertising campaigns, both Wounded Warrior Project and The Shriners Hospitals for Children appear to be highly focused and effective at bringing help to their target recipients.    Yet, and according to The Consumer Team and Charity Navigators, just one of the non-profits is being truly effective with their efforts.    The winner:  The Shriners Hospitals for Children.

Rating Charities - Saturday on The Consumer Team

Rating Charities – Saturday on The Consumer Team

Pete Thomson, host of The Consumer Team on CBS Radio’s KRLD in Dallas, citing Charity Navigator’s research, stated, “From 30,000 feet, Wounded Warrior Project and The Shriners Hospitals for Children look very similar.   They’re on-air creative is award winning and they’re helping 2 groups of people, our war heroes and children with serious health issues, who most people really want to help.   Yet, when you peel back the onion a bit more, the non-profits looks very different.   Based on the research of Charity Navigators, The Shriners Hospitals for Children are doing a better job getting donated support to people in need.”

Charity Navigators is a New York City based non-profit that rates the financial responsibility of non-profit organizations.   Sandra Miniutti, VP/CFO of Charity Navigators, has been a regular guest on The Consumer Team.   According to Thomson, his recent interview with Ms. Miniutti details the differences between Wounded Warrior Project and The Shriners Hospitals for Children.   Thomson added, “We really like the Charity Navigator’s on-line app because it gives consumers the ability to quickly vet a charity before they give a gift.   In the case of Wounded Warrior Project, one quickly sees a charity that is top heavy in administrative and promotional costs, which come at the expense of the war heroes that they’re trying to help.   We don’t dispute the mission of Wounded Warrior Project,  just the way they’re carrying it out.   On the other hand, when you vet The Shriners Hospitals for Children on Charity Navigators, you see a charity that is much better balanced.   They’re spending a lot of money in media for promotion and fund raising, but it isn’t detracting from their core mission.”

Pete Thomson and The Consumer Team have been champions of Charity Navigators for several years.   According to Thomson, the realities of today’s marketplace make an organization like Charity Navigators essential to making responsible donations.   Thomson added, “Financial management problems inside of charities is certainly not a new issue.  However, the internet age, eCommerce tools and very effective television commercials have created a real opportunity for virtually anyone to call themselves a charity, look credible and raise serious money from consumers who want to help.”

Thomson says that consumers should vet any charity, large or small, before giving a gift.   He added, “Sadly, some of the biggest non-profits, the ones with the household names, are not good managers of the money they receive.   I believe that using Charity Navigators is essential to making sure that a financial gift will be put to good use.”

Thomson said that he believes that responsible charities should be willing to open their books to organizations like Charity Navigators.   He added, “We believe that all non-profits should be transparent and offer their financials for review by Charity Navigators.  For Christian non-profits, the ECFA is recommended.  If a charity chooses not to disclose their financials, I believe it should give consumers a reason to reconsider giving a gift.”

For more information on charitable giving, Thomson recommends that consumers read The Consumer Team Guide to Charitable Giving.   “Our Guide is a good place to start”, Thomson added, “And it doesn’t take very long to do some digging either.   Devote 15 minutes to the project, and you’ll be able to make a much more informed choice regarding your next donation to a charity.”

The Consumer Team with Pete Thomson is broadcast Saturdays from 5-7 PM (Central) on CBS Radio’s 1080 KRLD in Dallas.   The Consumer Team is produced by McQ Media Inc.

 

 

Prepper Industry Profits on Consumer Fear

The magazine headlines scream messages of fear.  “Survive In an Urban Jungle”, “Protect Your Family from Terrorists”, “How to Have Food and Power When the World Falls Apart” are headlines that sell civilization’s fall.   Welcome to the Prepper Movement.  Once a fairly obscure group of what many considered to be conspiracy nuts, the prepper movement is now mainstream.     The badly designed newsletters, magazines and websites have given way to a nationally distributed brand that is bringing the new, slick prepper movement to the suburban American consumer.   And with this image upgrade, a whole new group of opportunistic, price-gouging prepper merchants are hawking everything from food to survival gear to specialized equipment at very, very high prices.

Consumer Team Alert:  Prepper Products Often Over-priced

Consumer Team Alert: Prepper Products Often Over-priced

Because of my involvement in amateur radio and emergency communication, I’ve had an opportunity to view the prepper movement from a unique perspective.   Amateur or “Ham” Radio is a foundational part of emergency communications.   Because of the service that Hams offer in times of emergency, we’ve had to become proficient at establishing communications in high duress situations.   We had to be preppers before prepper was cool.   And, because many amateurs come from the middle class (often working blue collar technical jobs), we’re also pretty frugal.

The $100 Compass

Initially, I was very impressed at the content of the prepper magazines.    Their production levels are very high and a result of the fact that several of the magazines are published by big national magazines, including Gun World which is owned by Beckett Media.    And, on the surface, the content seems well researched, until you started to really read the content and investigate the advertiser content.   Once the onion is peeled back, these publications truly reveal themselves.   They exist to give their merchants a ‘format of fear’ to sell overpriced stuff to consumers.

From a $50 compass to a $4,900 solar power back up system, the magazines are filled with products that pack a huge margin.   Don’t let the cool names and the cammo color schemes fool you, this stuff is largely a rip-off:  Here’s just a few examples of the prepper hoax:

The $100 Compass:   You’ll need this special compass to “find safety when the wheels fall off society…”    Apparently it has super-hero features that aren’t available on the virtually identical instrument you can buy at Walmart or at your local military surplus store.   And while it’s true that some of the prepper gear comes complete with cool names and cammo color schemes, if a real emergency hits and we need this stuff, I’m pretty sure that the color scheme and brand of my compass is not going to be a huge concern to me.

The $250 Knife:  For 250 bucks, this thing should slice, dice and make Julienne fries.

The $88 Chinese Military Shovel:   Apparently the fact that the shovel head rotates makes it very unique.   Funny, I found a similar product at Home Depot for under $40.

Solar Power System for $4,900:   This is my favorite prepper scam.  These guys are true long-ball hitters.   They’re saying, “Hey, let’s not just rip off consumers, but let’s grab a couple of thousand dollars in the process.”  This ‘back up solar power system’ that several companies market consists of a solar panel, 50 foot of extension cord and a marine cell battery.   Ham radio operators have been using this type of system for back-up power for years.   This equipment is readily available for less than $1,000 and maybe less if you shop smart.

Gold, Silver & Numismatics:   The mainstay advertisers for talk radio and cable news love the prepper population.   After all, in a post-civilized world, precious metals will be our currency, right?   They hook you with competitive pricing on gold and silver, but make their huge margins when they sell numismatics (rare coins) at astronomical mark ups.   By the way, if you’re looking for ‘currency’ to use in a real, wheels off, dollar’s useless emergency, try stocking up on shovels, ammo, medicine and non-perishable food.   In the event of a true multi-month calamity, that stuff will have much more value than an Augustus Saint-Gauden gold coin.

Resources for a Frugal Prepper:

Thanks to a growing network of savvy preppers, it’s possible to find great survival products for a fraction of the stuff in the prepper comic books.  Here are several sites that we suggest:

Home Power Magazine:   This ‘mom & pop’ magazine launched in 1987 and is now one of the best sources about alternative power sources.

The Frugal Prepper Robert Paine’s book is filled with down-to-earth, common sense truth regarding how to survive in an emergency.

American Prepper’s Network  Although some of the overpriced products are trying to infiltrate APN, this is an impressive collection of prepper info.   With links to media, products and other preppers, this is an invaluable resource.  Again, because of its size, you need to be a savvy shopper and be on the look-out for the $100 compass products.

eHam Network:  eHam is a leading website devoted to amateur radio and offers information regarding licensing, equipment and emergency communication.

FEMA Resources:   Although some hard-core preppers are ‘anti-FEMA’ (search ‘FEMA camps’ for information), FEMA does offer some very good (and free) information on emergency preparedness.

Networking:   There are a number of Facebook, Yahoo and Google groups dedicated to prepper issues.

Informed consumers are not fooled easily.   And, the more you get involved in ‘the discussion’, the less likely you are to getting ripped off.   In the coming weeks, we’ll be discussing prepper issues in more detail on The Consumer Team.   We live in very interesting and historic times that, indeed, make this discussion both timely and relevant.

Pete Thomson

The Consumer Team

Editor’s Note:  Pete Thomson is President & Founder of The Consumer Team, a Dallas-Ft. Worth based consumer advocacy initiative.   Thomson is heard weekly on The Consumer Team radio program, Saturdays 5-7 PM (Central) on 1080 KRLD.  Thomson also serves as President & CEO of McQ Media Inc, a Dallas-based marketing firm.   Thomson is an active amateur radio operator.  His call sign is KE5GGY and is heard nightly on 3.916 MHz on the 75 meter band. 

 

 

 

 

 

For Profit Colleges: Big Promises, Huge Debt, Shattered Dreams

I’m not a proponent of lots of government regulation.  In fact, whenever I hear the words “I’m from the government and I’m here to help”,  I immediately run.  However, after researching some of the malarkey going on in the “For Profit” college category, I’m beginning to think that a good, government sponsored, butt kicking might be in order.

For Profit Colleges:  Leaving Students Jobless and In Debt

For Profit Colleges: Leaving Students Jobless and In Debt

What is a For Profit College?    You probably know them well, but by their heavily marketed names such as University of Phoenix, DeVry University or ITT Technical.   These schools bombard the television airwaves with spots touting that you can find a job, a career and a great life by getting one of their degrees.   Dig a little deeper and you find the problems.   For profit colleges are very expensive, especially when compared to a local, non-profit community college.   And, as many a for profit grad have discovered, a for profit degree often leaves a person in huge debt with no job prospects.   Even more troubling is the for profit college mega-aggressive marketing strategy that targets low-income and veteran consumers.   And similar to the payday loan industry that I’ve written about previously, for profit colleges also appear to be harvesting huge gains at the expense of people who are already experiencing great pain and challenge in their lives.   This last fact is what makes my blood boil.

Consumer Team Investigates For Profit Colleges:   I interviewed Consumer’s Union attorney Suzanne Martindale for my consumer advocacy radio program The Consumer Team.   The interview will be broadcast on Saturday, August 30, 2014.   Martindale, who is on the front lines of fighting for increased scrutiny of for profit colleges, voiced concern about Wall Street’s involvement in the for profit college industry.    That’s right, a number of these colleges are public companies.   As Martindale shared in our interview, the for profit college industry is currently under fire from a number of angles.   The Securities and Exchange Commission and Consumer Financial Protection Bureau are both investigating the category, as are the attorneys general from 30 different states.

Buyer Beware:   In spite of my comments above regarding government regulation of this business category, I believe that the marketplace is generally better served by an informed consumer who votes with their feet.   Anyone considering attending a for profit college needs to do additional research.   Indeed, one doesn’t have to do much digging to find serious dirt.     And, compliments of Ms. Martindale, the links below provide some valuable facts.

http://consumerist.com/2014/07/18/your-corinthian-operated-school-is-closing-but-you-might-not-be-completely-screwed/

http://consumerist.com/2014/07/17/student-corinthian-colleges-demise-is-like-watching-a-house-fall-on-a-witch/

http://consumerist.com/2014/07/24/corinthian-colleges-employee-we-work-for-the-biggest-scam-company-in-the-world/

http://consumerist.com/2014/07/31/comcast-makes-money-off-everest-university-ads-even-as-schools-are-being-sold-or-closed/

 

Pete Thomson

CEO – The Consumer Team

Editor’s Note:  The Consumer Team talk radio program is broadcast Saturdays from 5-7PM on CBS Radio’s 1080 KRLD in Dallas/Ft. Worth, Texas.  Pete Thomson has been working in consumer advocacy and investigative journalism for over 10 years.   Thomson is President/CEO of McQ Media, a Dallas-based advertising and marketing firm that promotes consumer and business advocacy.

 

Consumer Team Alert: Older Consumers Targeted by Scam Advertisers

I’m not against making a profit.  Not at all.   Commerce and profit have been woven into my life since I was a checker at my father’s Ben Franklin five-and-dime on Main Street in Charles City, Iowa.  The profit I’m concerned about is what an increasing number of companies are making from older consumers.  Super high margins are being made on products of questionable value.   On the surface, the commercials for gold, speed-up-your-PC software, supplements and other products look very legitimate.  And the creative is often speaking directly to the deepest emotional concerns of older consumers.   The problem with many of these products is threefold:  exorbitant profits, a business model that is not transparent and questionable product quality.   Here’s my current ‘hit list’ of questionable products and services that are targeting older consumers.

Scam Marketers Are Targeting Senior Consumers

Scam Marketers Are Targeting Senior Consumers

The Speed-Up-My-PC Scam:   This category is low-hanging fruit for the senior profiteers.   Older consumers are generally not comfortable with computer maintenance.  And several companies have taken advantage of the issue with highly questionable products.   According to ARS Technica, a leading technology website, a significant number of these products are ineffective and, in some cases, harmful to user’s computers.   From fixing ‘fake problems’ to even loading malware on user machines, the products are bad news.    According to ARS Technica, consumers of all ages are better served by free software available from Microsoft and other reputable sources.

The Senior Gold Rush:    Older consumers, largely because they’re watching political events in our country with horror, are great targets for the doom-and-gloom pitch of precious metal hustlers.  And while some of the companies do offer competitive pricing on gold and silver coins (the bait), high mark-ups on other products such as numismatic coins can hammer the consumer.   A better alternative is a precious metals ETF or a session with a retirement planner with a fiduciary interest in the client.

“Free Products” With Hidden Handling Charges:   Several years ago some direct marketer discovered that they could unload more of their cheap crap if they gave it away and then charged the consumer a ‘hidden’ handling fee.   You’ve heard the pitch, “Call now and get our product for free.  You just pay shipping and handling.”   As a result, there are currently a ton of “free” products—everything from DVDs for dealing with difficult kids to “secrets” of getting more from social security that a consumer can get for no charge, other than the handling charge that is ten times what postage would normally be for shipping the product.   The hard-core direct marketers even put a digital counter on the screen that indicates how many free widgets are still available for that day, which is amazing because the commercials are all prerecorded.

Social Security Scams:   There are, indeed, social security claiming strategies that are legitimate which will help consumers get more from Social Security benefits.   They’re free and available at a number of legitimate websites and financial planners.   Leave it to the scammers to find creative ways to charge people for free information.   One of the schemes is being run by a national magazine through a radio ad that promises to help consumers unlock hidden Social Security benefits.   In order to get the information, the consumer agrees to a trial newsletter subscription that, unless cancelled in a specific time period, becomes an annual paid subscription to several newsletters.   After this scheme gets past 30 days and the consumer is billed for the subscription, it is very difficult to cancel the subscription.   By the way, direct marketers have a name for this type of scheme.  It’s called a ‘Continuity Plan’ because it results in monthly revenue from the consumer for a product, service or subscription.

Reverse Mortgages:   The television ads tout the good life that one gets when they finally get the cash from tapping into their home equity.   Celebrity endorsers make the process look so easy and quick.  What goes unmentioned are the fees and other costs associated with a product that can leave seniors in serious financial trouble.     While the reverse mortgage product is not necessarily a scam, the marketing tactics being used to promote them are very questionable.

Final Payments Insurance:   Here’s a lovely group of scallywags who target older consumers with low incomes.   Yes, that’s right.  It’s not good enough to just screw-over seniors, they nail the ones who don’t have much to begin with.   The pitch:  Buy this insurance so when you die your funeral arrangements are covered.    The scam:  The companies don’t disclose that they’re selling insurance.   The insurance is not low cost, as advertised.  And, many consumers already have coverage in their existing insurance coverage.

Tax Debt Resolution:  Clever marketers have discovered that if they describe the IRS tax resolution process as complicated and mean enough that they can over-charge consumers who owe back taxes.   They pitch ‘secret’ government programs like some kind hidden treasure that only they can unlock.   After their marketing makes them sound like Indiana Jones taking on the IRS, these firms charge large ($10,000 and more) retainers up front to accomplish a the same job that can be done by a patient CPA for much less.

Charities:   Older consumers have hearts…big hearts.   And the non-profits know it all too well.   For every reputable charity advertising on television and radio, there’s probably 10 bad ones.   They’re bad because they handle the money you give them poorly.   Oftentimes a low percentage of gifts will reach the actual people in need, going instead to charity overhead.   Charity Navigators, a non-profit Charity watch dog group, does an outstanding job of policing the non-profit sector.   Sadly, some of the most commercially active non-profits are among the worst rated charities in the Charity Navigator ratings.   The relative high cost of advertising campaigns often result in a high cost of donor acquisition.   Put another way, when you give to a charity that is advertising on radio or television, your gift often goes to pay for the commercial that motivated you to give.

As I’ve written previously, I’d love to see broadcasters take a more aggressive role in cleansing the airwaves of scammers, especially the ones that target older consumers.  However, the current debt service of broadcast companies won’t support this kind of honesty.   And although the government would love to get move involved in the process of protecting us (EG: Consumer Financial Protection Bureau), I believe it is the consumer’s responsibility, including senior consumers, to be even more vigilant in our consumer lives.   With the freedom of American commerce comes a responsibility for the consumer to be informed.   On my consumer advocacy program, The Consumer Team, we regularly talk about strategies that consumers of all ages can use to avoid being ripped off.   In my next blog, I’ll take you through the strategies.   And, best of all, there is no charge…..not even shipping and handling.

Pete Thomson

Founder/CEO

The Consumer Team

(Editor’s Note:   Pete Thomson is a 30 year veteran of broadcast media and marketing.   As a television and radio broadcaster, he worked in programming, sales, sales management and general management.    In 2011, Thomson opened McQ Media, a full service marketing and advertising firm located in Dallas, Texas.   Also in 2011, Thomson founded The Consumer Team, a consumer advocacy radio program heard weekly on CBS Radio’s KRLD in Dallas.)

 

Scam Advertisers: Are Broadcasters Responsible?

(DALLAS-FT. WORTH, TX)   Consumer Team host Pete Thomson recently wrote a blog challenging broadcasters to be more aggressive in screening advertisers for scam products and services.   Below is the body of Thomson’s blog post which appeared on http://www.mcqmedia.us.

Recently in the Dallas-Ft. Worth market, a high profile heating and air conditioning company filed for bankruptcy.  In the wake of their financial collapse are several radio stations holding unpaid invoices and thousands of consumers left with worthless maintenance agreements.   What makes this situation even more interesting is the nature of the the defunct company’s advertising offer.   They were pitching a scam.  “Call me today and I’ll give you $6,000 off my cost on a new system,” the owner of the company would say in his radio spots.   When he was really feeling philanthropic, he would throw in his labor for free.  And, every one of the company’s spots ended with the tag, “Honesty above reproach.”    For illustrative purposes and for the rest of this article, I’ll refer to this company as ‘Scam Heating & Air’.

Scam Advertisers - Are Broadcasters Responsible?

Scam Advertisers – Are Broadcasters Responsible?

In talking to several HVAC firms in the Dallas-Ft. Worth market, I’ve learned that a number of company owners contacted local radio station management regarding the lack of veracity in Scam Air’s on-air offer.  As one company owner put it, “There’s no way any dealer can honestly discount an HVAC system by $6,000.”   So even though station leadership possibly knew that the offer was a scam or a bait-and-switch, broadcasters continued to take Scam Air’s money, year-after-year.   As long as the check was clearing, broadcasters turned a blind eye to the Scam Air’s incredulous on-air offer.   In the interest of full transparency, I need to disclose that, for a short period of time, I allowed Scam Air to advertise on a station I managed.

So now, as the dust settles on this Scam Air’s demise, I’m betting that local broadcast management is asking themselves some tough questions.   Was the revenue that broadcasters received worth the damage done to thousands of their listeners?  Why was a spot advertiser airing fraudulent creative allowed to advertise for an extended period?   What could be done differently to prevent this from happening again?

Since broadcasting ‘sold out’ to the highest bidder in the deregulation of 1996, pressures on the sales division have increased exponentially.  Sales managers have to meet their quarterly numbers or they’ll be gone.    I know.  I was part of this machine for years.   And unless someone’s blatantly breaking the law with their business or their creative, pretty much anything goes on air.   And Scam Air’s just one example.   Broadcasters everywhere run copy for magic male enhancement pills or rare coin offers that are total scams.

Another example of a scam-running-rampant on television are the ‘clean up and speed up your PC programs’.  They’re on older skewing networks targeting unsophisticated computer users with offers of a miracle clean up of their computers.  According to ARS Technica, a leading technology website, a majority of these programs are a scam.  They often make routine cookie and temporary internet files look like viruses.  In some cases, the clean up programs are malware themselves.   Meanwhile television networks take the scam commercials without batting an eye.

As a broadcaster and agency owner, I’m troubled by our lack of standards of a number of levels.  By turning a blind eye to bad deals for consumers, we’re ultimately undermining our listener’s trust in our stations.   Longer term, our lack of standards and practices could make it easier for government regulation to creep further into our lives.   A chilling example of this is occurring in the financial world as the Consumer Financial Protection Bureau, a product of the Dodd-Frank Act, is threatening to regulate financial planners.   All it takes is a couple of well orchestrated class action suits aimed at advertisers or even broadcasters themselves to make us a target of increased regulation.

A much easier and more pleasant road for broadcasters and agencies to follow would be one of self-regulation.  As an industry we need to look deeper in the business models of our advertisers.   Instead of looking for clients with big budgets, we need to look for clients who have a great value proposition for our listeners.   When listeners win, we win.   By the way, ferreting out scams is not a difficult process in many cases.  In both of the case studies I’ve cited above, routine investigations would have exposed the advertiser scam.

If you’re a broadcast sales seller or a manager, let me encourage you to pick your prospects and target accounts with care.   Can we catch every bad apple from hitting our airwaves?   Probably not.  And, ultimately consumers do have a responsibility to assume the ‘buyer beware’ posture when responding to any advertisement.   Still, if we search appropriately, there is an abundance of companies who can truly offer an outstanding product or service of value to our listeners and viewers.   Dig deeper in your prospecting efforts.  The effort will be well worth it.

Pete Thomson

CEO – McQ Media

Dallas, Texas

Editor’s Note:  Pete Thomson is veteran of broadcasting and media management.  He is President/CEO of McQ Media,  a full-service advertising and marketing firm in Dallas-Ft. Worth, Texas.  Thomson describes McQ Media as a ’boutique’ firm, that only represents firms who are best-in-category.  McQ Media produces a consumer advocacy program called, The Consumer Team, which airs Saturdays 5-7PM on KRLD Radio.  Like McQ Media, The Consumer Team only features companies that are ‘best in category’ that also have a strong record of positive customer service.

 

 

 

Donations to Charity…..The Consumer Team Guide To Giving Wisely

The bigger and more tragic the disaster the more likely it is that bad non-profits will be emerging ready to take money from people who want to help.  For every reputable non-profit there’s 10 shady ones that are using people’s misfortune to line their own pockets.  In this article my goal is to arm you with information that will help you identify the bad guys and their scams and, as a result, put your generous gifts to work with non-profits that really care about helping people.

All Charities Are the Same Aren’t They?

Largely because of the work of reputable charities like The Salvation Army and The Red Cross, many consumers believe that all non-profits are created equal and that anytime they make a donation to any organization that has appropriate classification as a 501-C-3, that their donation is going to good use to actually help the people in need.   The reality in today’s marketplace is that a high percentage of non-profits are not good stewards with the donations they receive.  Some of the biggest most reputable appearing non-profits and ministries that dominate television and on radio make big promises on their infomercials.  In reality, a relatively small percentage of gifts are reaching the needy.  In the case of many of the web based charity campaigns, none of the money is going to the cause that is advertised.  Buyer beware.  Or, I guess we should say, ‘giver beware.’

Pete Thomson – CEO of McQ Media

Sadly, charities and ministries who once had a real heart for helping people, can lose focus of their foundational purpose because of the jaws of overhead.   CEO and leadership salaries, marketing and other infrastructure expenses can easily turn even the best intentioned groups into an organization that is overwhelmed with the costs of doing business.   Well respected and generally trusted ministries based out of large churches at times even struggle with the process of making sure that gifts intended for relief actually end up in the hands of the needs.

Avoid The Charity Scam by Finding Reputable Charities and Ministries

Here are some suggestions for making sure you don’t become a victim of a charity scam.

Delete All Charity Emails:  First, never, ever, ever give to any cause that approaches you via email.   Unless you have an established relationship with the ministry that you’ve first initiated, consider all the email solicitations to be bogus.  Even emails that appear to be from a major charity are often a front for a scam, often located off-shore and out of reach of US laws.

Look At Financials:  Credible non-profits aren’t afraid to share their financials with donors.  They’re often made available on the non-profit’s website.  When looking at financials look for one number.  That’s the percentage of money that ends up going to the people in need.  So, in other words, after marketing, administrative and CEO costs, what is the percentage of a dollar that gets to people who need help?    There’s some debate on what constitutes an acceptable percentage.   Personally, I like to see the number be 95% or greater.

Charity Watch Dogs:  Several charity and non-profit watch dog groups can offer good intelligence as well.  Charity Navigator is well respected as an objective s0urce of information.  For Christian non-profits, The Evangelical Council for Financial Accountability offers a similar service.

Charity Scams Target Older Givers:  Older people sadly often fall victim to charity scams.   Their general lack of sophistication with email (see email scams above) along with isolation and their overall attitude of generosity makes for a perfect profile for the bad guys to go after.   Take time to make sure that the seniors in your life become well informed about charity and non-profit scams.

Charity scams will only get more sophisticated and effective in the future.  Indeed, high technology has given the bad guys a new ‘Wild West’ to operate in with great anonymity.  Because of this, we all need to be even more vigilant in our efforts to separate the good from the bad.    Giving to reputable and responsible charities can truly impact the lives of hurting people.   As a consumer, you must shop…and give….wisely.

Pete Thomson – CEO

McQ Media

Dallas, Texas

http://www.mcqmedia.us

 

Editor’s Note:  Pete Thomson is a veteran of the radio and television industry.   He’s currently President/CEO of McQ Media Inc, a full service media and advertising firm based in Dallas, Texas.   He has consulted the nonprofit sector for over 20 years and has helped design donor development campaigns for numerous nonprofit organizations.   Thomson’s weekly consumer program on KRLD Radio in Dallas, The Consumer Team, addresses consumer issues including charity scams and fraud.

 

 

 

 

 

 

Consumer Team Reports on Angie’s List, Yelp and Other Review Sites

(DALLAS-FT. WORTH, TX)   Each year millions of consumer dollars are being spent based on reviews and ratings of user-review websites such as Angie’s List, Yelp and other similar websites.   The Consumer Team talk radio program will be airing a special segment featuring Jeff Blyskal of Consumer Reports on Saturday, September 28, 2013 from 5-7 PM on KRLD Radio.   Blyskal will be addressing Consumer Reports’ recently published study regarding the objectivity of user review websites.

Pete Thomson - The Consumer Team

Pete Thomson – The Consumer Team

Pete Thomson, host of The Consumer Team called the Consumer Reports study the most complete and objective he’s seen.  Thomson said, “Consumers are spending so much money as a result of the ratings and reviews from Angie’s List, Yelp and other similar websites that it’s important to understand how the sites are processing information.   As usual, Consumer Reports dug deep into each of these sites to analyze exactly how ratings are given out.”

Thomson added that the feature with Jeff Blyskal is the first of a series of segments that The Consumer Team will be doing on user-generated ratings and review sites.  Thomson added, “I’m very concerned about several aspects of teh veracity of user-generated business reviews.  First, there’s the issue of competitors or disgruntled employees purposely posting negative reviews to sabotage a business.   Secondly, internet marketing companies are often hired by small business to post fake reviews online.   And, we’ve discovered at least one website, Scambook.com, which appears to have built a lucrative business model out of charging small business a monthly fee to remove negative reviews on their site.  In our opinion, it’s online extortion.”

Regarding Scambook.com, Thomson said investigations are underway to expose the site along with others using similar tactics.  Thomson added, “Eventually the truth will come out, but when you consider the damage being done to small business across America, it’s chilling.  I’m an advocate of free speech, but this type of small business shakedown needs to be recognized for what it truly is.”   Thomson continued, “In addition to exposing the Scambooks of the world, consumers need to understand now, more than ever, that information on the world wide web should be considered carefully relative to its source and credibility.”

Scambook, according to Thomson is a good example of how investigation can yield useful results.  He added, “On the surface, Scambook looks like a real friend of the consumer.   However, when you dig down and peel back the layers of the onion, it’s very obvious what their true motives are.  In fact, there are numerous sources of intel, including BBB complaints and an investigation by WMAQ-TV in Chicago, that shine the light on the truth regarding these guys.  But again, if a consumer is only looking at their website or their marketing that shows up in a Google search, its very easy to miss the truth.”

The Consumer Team is one of the most listened to weekly consumer advocacy programs in America.   Its flagship station is 1080 KRLD which is owned and operated by CBS.    In addition to his work in consumer advocacy journalism, Pete Thomson also serves as President/CEO of McQ Media, an advertising and marketing firm based in Dallas, Texas.

 

 

Consumer Advocate Pete Thomson: Healthcare Scams Targeting Retirees

(DALLAS-FT. WORTH, TX)     New healthcare laws have brought much uncertainty to consumers, especially retirees.  According to consumer advocacy journalist and radio host Pete Thomson, new scams are surfacing that are taking advantage of the uncertainty in the marketplace.   Thomson’s weekly radio program, which airs on CBS Radio’s KRLD in Dallas, will focus on healthcare scams on Saturday, July 27, 2013 from 5-7PM (Central).

Pete Thomson - The Consumer Team

Thomson said that the new healthcare scams are reaching consumers primarily through the internet and telemarketing.   He added, “Scammers are targeting seniors.  They’ll often call or email, claiming to be with the federal government, and say they need to confirm a social security number.  Other times they’ll call offering a special deal on low cost healthcare coverage.   The scammers are always looking for personal information that they can turn into cash.”

Thomson claims that the uncertainty surrounding healthcare is helping the scammers succeed.  He said, “Our nation’s healthcare system is about to be in transition and people, especially retirees, are concerned about the future of their healthcare.  The people behind the scams love this uncertainty.   They’re selling security and solutions in a very uncertain environment.”

According to Thomson, the first line of defense again healthcare scams is to simply hang up or delete the email.   Beyond that, he says, reaching out to seniors who are isolated is very important.   Thomson added, “Seniors often become isolated from the mainstream marketplace.  We believe that reaching out to seniors in our families and neighborhoods is an important part of defeating this type of crime.”

Thomson credited Consumer Team New York City reporter Ernie Sprance for his contributions to the special coverage on healthcare scams.   He said, “Ernie did an outstanding job of digging into this issue.  He’ll be filing two different on-air reports on The Consumer Team.   After listening to this information, listeners will be better prepared to deal with this growing fraud.”

Thomson’s Consumer Team talk radio program is one of the most listened to local programs dealing with consumer news, research, trends and issues.   Thomson says that his passion for consumer advocacy started during his childhood growing up in the midwest.   Both of his parents were business owners in Charles City, Iowa.  According to Thomson, seeing successful business and customer relationships fueled his interest in helping connect consumers with reputable business owners.  He said, “Growing up in Charles City, I saw the special relationship that can exist between business and the customer.  Our goal on The Consumer Team is to first educate our listeners regarding the issues that can impact their success as a consumer.  Beyond that, we strive to connect our listeners with great businesses who truly understand what it means to serve the customer.”

For more information on The Consumer Team or to listen live, to to http://www.myconsumerteam.com.   The Consumer Team is produced by McQ Media, Dallas, Texas.

 

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