- April 15th, 2016
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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.
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.
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.
Organic….Natural…..Locally Grown. These words are common in the marketplace because consumers are demanding fresh and healthy. Natural News estimates that 2014 profits from the sale of organic and natural food were over $35 billion. Consumers want healthy and we’re willing to pay for it. The prices of organic food products are often much more than food that doesn’t have the organic seal of approval. In some cases the price is over 100% more than non-organic products. The profits from organic food combined with a weak inspection system in the US has resulted in a consumer world where food that is advertised as organic is often far from it. We’re paying a ton of money for organic food and, oftentimes, getting junk.
In 2015, Forbes published an investigation of the organic food industry. “The Colossal Hoax of Organic Agriculture” is a well researched work that shines a light on a number of issues, including how misinformed the consumer is regarding organic food. Consider pesticides. Although it’s generally true that chemical pesticides are prohibited in organic products, there are exceptions including natural pesticides. Natural pesticides can be toxic. Another consumer misconception is regarding GMOs, genetically modified organisms. Consumer perception is that organic means GMO free. It doesn’t. As long as organic food is produced using an authorized process (which is not closely inspected), the presence of GMOs in food is not a violation.
So how can this all happen? Why aren’t testing standards protecting the consumer? Just follow the money to understand the scam. The sheer profits that organic food produces, including a super-high premium paid by consumers, has created an incentive for food producers to create a system that is lax and offers plenty of wiggle room. According to the Forbes study, for the majority of organic products, no tests can determine the difference between organic and non-organic. And when tests or inspections are present, they’re often incorrect or incomplete. Forbes cites a 2014 Wall Street Journal investigation that found that almost half of USDA inspection agents failed to uphold USDA standards. The organic food inspection system is totally loose. And the organic food lobby is so big and well-funded that their lobbying effort has been successful in preventing any changes to the system. Show me the money.
The poster child for bad behavior in organic foods is Whole Foods Market. According to the Forbes investigation, the food retailer was found to be importing large amounts of produce from China. Yes, the same China where the air is not breath-able. And the Whole Food’s scam gets even better. They advertised their Chinese “glow-in-the-dark” produce as “California Blend”.
So, what can a consumer do? First, unless you can personally identify and confirm how a product is produced, packaged and stored, don’t pay a premium for organic. Beyond that, do research for yourself. Below are several resources we believe are viable:
Lastly, call or write your representatives in Congress. Let them know that you’re informed regarding the organic food scam, including their complicity in maintaining the corrupt organic food system in the US.
CEO – The Consumer Team
Editor’s Note: The Consumer Team with Pete Thomson is heard Saturdays from 6-8 PM (Central) on CBS Radio’s 1080 KRLD, Dallas-Ft. Worth. The Consumer Team features news and information on consumer issues. Additionally, the program recommends ‘best in class’ business sponsors in the Dallas-Ft. Worth, Texas area.
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.
“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.
“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.
(DALLAS-FT. WORTH, TX) The Consumer Team talk radio program today announced the creation of a multi-part series focusing on senior scams. Pete Thomson, host of The Consumer Team, announced the new series. He commented, “Consumer Team has been addressing scams targeting senior consumers for several years. Our new senior scam series of broadcasts will address a number of aspects of elder or senior scams.”
Thomson said that seniors are a huge target for fraud and even violence. He said, “Seniors are a perfect target for bad guys. They have money saved. The bad guys know that and they’ll do almost anything to steal from them. In our series on Consumer Team we’re going to try to arm our listeners with information that will protect them and their loved ones from fraud targeting seniors. One thing that will never change is the greed of the criminal. However, with the right information consumers can fight back. That information will be our focus on Consumer Team.”
A recent Consumer Reports article estimates that senior fraud is big business. The publication estimates the annual cost to be around $3 billion per year. Tobie Stanger of Consumer Reports who contributed to the recent story will be a featured guest on several Consumer Team interview segments. Thomson added, “Tobie Stanger’s work in elder fraud and senior scams is outstanding. I look forward to having her on Consumer Team to add valuable detail to this important story.” Thomson said that Stanger will review law changes that are designed to better protect senior consumers.
Consumer Team is broadcast Saturdays from 5-7 PM (Central) on CBS Radio’s 1080 KRLD in Dallas-Ft. Worth, Texas. Pete Thomson is a 40 year veteran of the broadcasting industry and has worked in consumer advocacy journalism for over 10 years. The Consumer Team with Pete Thomson is produced by McQ Media, Dallas, TX.
(DALLAS-FT. WORTH, TX) The Consumer Team today announced that a new investigative series on the organic food industry will start airing in November of 2015. Consumer Team host Pete Thomson, commented on the series. He stated, “The Consumer Team will air a series of segments aimed at educating consumers regarding organic foods. Recently, serious charges have been made regarding the integrity of organic food. Our series will help consumers to truly understand the issues involving organic food and to make more informed shopping decisions.”
Several recent investigations have disparaged the organic food industry, including Dr. Henry I Miller’s recent article in Forbes, The Colossal Hoax of Organic Agriculture. Thomson voiced several concerns regarding organic foods. He said, “Consumers pay a huge premium for food that is labeled as organic. Recent research and studies, including Dr. Miller’s article in Forbes, are challenging the integrity of the organic industry. On The Consumer Team we want to weigh the evidence objectively and help consumers understand the truth.”
Thomson said that a thorough understanding of the role of pesticides in organic food will be essential to understanding both the benefits and safety issues surrounding organic foods. He added, “The pesticide discussion is the part of the organic discussion that people are finding both educational and concerning. People are generally surprised to learn that pesticide free doesn’t necessarily mean food more healthy.”
(Dallas-Ft. Worth, TX) With the release of the Windows 10 operating system, computer shoppers have many choices to make. Saturday (8-8-15) on The Consumer Team, Donna Tapellini from Consumer Reports will join Pete Thomson to share tips for getting the best deal on a new computer.
Pete Thomson, Consumer Team host, said listeners will save money with the information from the interview. He said, “Right now consumers have operating system confusion. Windows 8 was not a popular OS. Even though early reports on Windows 10 are positive, shoppers are understandably gun shy. Our interview with Donna will clear up the confusion.”
(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.
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.”
(Dallas-Ft. Worth, TX) LifeLock is back in the news, this time as a result of the Federal Trade Commission’s claim that the company is continuing to make false claims in their advertising. Problems with advertising claims are not new for LifeLock, who paid $12 million in fines in 2012 to settle charges that it made deceptive and false ad claims. The most recent FTC charges claim that LifeLock falsely advertised the ability to secure its subscribers data with the same technical sophistication as major financial institutions. The FTC charges also claim that LifeLock failed to create and maintain a comprehensive security program to protect users’ credit card, social security, and bank account data.
Pete Thomson, founder of The Consumer Team, commented on the latest charges against LifeLock. “We’ve been concerned about the advertising claims of LifeLock for some time. Their commercials make promises that aren’t in line with the actual product they deliver. Very troubling, also, are the charges regarding LifeLock’s own internal systems for protecting customer data. If anyone should have bullet-proof internal systems for protecting customer data, it should be the company selling ID theft protection.”
Thomson said that The Consumer Team will be airing a series of programs regarding identity theft. Thomson said, “There are a number of competing messages in the marketplace regarding identity theft and much of the information is either exaggerated or just plain wrong. We’re in the process of vetting several sources to be experts on The Consumer Team.”
Thomson says he wants to clarify several aspects of identity protection on The Consumer Team. He added, “First, we believe that consumers must take a proactive role in the process of protecting their critical personal information. Beyond that I want us to help consumers understand how to respond after their identity has been breached. In the area of identity restoration, consumers need to understand the process and what assistance they will receive as part of an ID theft protection package.”
(DALLAS-FT. WORTH, TX) The Consumer Team announced today that Tri-Star Insurance Professionals has been awarded a 2015 CISQUA Award. The award, which recognizes outstanding North Texas businesses, was recently presented to Roger Harkins, founder and owner of Tri-Star Insurance Professionals. Consumer Team founder Pete Thomson commented on the award. He said, “I’ve known Roger Harkins for over 10 years. Our long association started when Tri-Star Insurance Professionals saved me over $3,000 annually on my homeowners and auto insurance. Now, over a decade later, Tri-Star Insurance has helped thousands of Consumer Team listeners save money and get better insurance coverage. I am excited to see Roger and his team receive this award.”
The Consumer Team CISQUA Award recognizes exemplary performance in the areas of consumer integrity, service, quality and accountability. Regarding Tri-Star Insurance Professionals’ selection, Thomson added, “The team at Tri-Star embodies everything CISQUA is about. They operate with the highest levels of integrity in a very competitive industry. Beyond that, Roger has built a team that excels in customer service. They are an outstanding organization.”
Thomson said that the CISQUA Award was created to promote best practices in the Dallas-Ft. Worth business community. He added, “On The Consumer Team our goal is to connect educated consumers with the best businesses in North Texas. By bringing CISQUA to Dallas-Ft. Worth, we’re hoping to raise the level of awareness regarding these key areas of business responsibility.”