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FYI: Long post
I really detest the sales practice I’m going to call ‘hidden bundling’. I’m not sure what the actual term is, but it’s certain not upselling. When you upsell, you add-on *additional* items that the customer may not have thought about, but make the overall sale more profitable. It might be an appetizer or dessert at a restaurant, or it may be additional memory for your computer, or a carrying case for the nice new spiffy MP3 player you bought. In all these cases, you get what you wanted, and then the salesman gets you to buy something extra.
That’s *good* salesmanship.
The process of hidden bundling is covert and sneaky. I know why it’s done, because I was forced to do it. Many moons ago, I worked at the Camera Shop. With all the cameras we sold extended warranties. As salesmen, we were measured on the amount of extended warranties we sold. If you sold someone a camera and told them they had a 1 year warranty on it, but they could buy an additional 2 year extended warranty for $X, you had a much harder sell than if you simply sold them the camera with a 3 year warranty and had the ext. warranty already ‘priced in’.
Now, the astute customers already knew what the cost of the camera was, as they had shopped around. And when you tell them the price, and they notice its higher than other shops, they would question as to why we were higher. Then you’d explain about ours having a 3 year warranty, and when they said they only wanted 1, you’d take ‘away’ the ext. warranty, price match, and still get the sale.
Others would look at their receipt, see the price of the camera, and then an additional line which said extended warranty $X, and question it there. Often you’d just tell them that’s the way it was rung up. Occasionally, they would ask to remove the ext. warranty and save the extra $.
More often than not, though, you’d see the bundled item, never let the customer know they *had* a choice, and get your sales numbers up. Was the ext. warranty a good thing? It may have been to some, and not to others. The point isn’t the value of the bundled item, it’s the fact that you never gave the customer a choice.
So that brings us to 2007. My father had the luxury of dealing with a horned salesman at the Verizon Wireless store the other day. I go over to see him for lunch and he tells me he upgraded his phone. It only cost him $50 after a mail in rebate. He didn’t get the bluetooth just the headset that came with it for free, as he was going to get a bluetooth headset from his nephew.
At that point, the bells started going off. I deal with cell phones alot, and I know that they don’t *come* with a headset, or a case, or a car charger. Those are the items that they normally try and upsell you. There is a huge profit margin there, and that’s where Verizon and the salesman made extra money.
Are you sure they came with it Dad? You didn’t pay extra for it. No, he tells me. The phone was $50 and it included all those things. I saw the scam already developing, and I don’t mind calling it a scam. I asked him to find his receipt and looked it over.
Sure enough. The phone was free (because of his contract renewal), and the headset, case, and car charger were all rung up separately equating to $49.99 – the cost of the add-on package. “Dad”, I asked. “Why is the case in the bag?” Because he didn’t plan on using it either. He got a RAZR and was just going to keep it in his pocket. So now, he’s got a $19.99 headset he wasn’t planning on using and a $9.99 plastic case he wasn’t going to use either. When he found out how they were rung up, he got pissed — and had every right to be. He’s planning on taking them back and getting his money refunded.
Unfortunately, my father was the exact same kind of person we used to prey on during my camera selling days. They aren’t quite as technically savvy as they could be, and by portraying a scenario which makes them thing they are *getting a deal*, they walk away happy, and don’t even bother to double check anything is out of the ordinary. He was told the phone was $50 and included those items, so when his bill was $116 (before the 50 mail in rebate), it was exactly what he expected it to be — and no flags went up.
The salesman should have *told* him the phone was free, and given him the *option* of buying the kit. A good salesman would have pointed out that they kit was much more economical than buying the individual parts, that you were required by NJ law to use a handsfree kit or headset in the car, etc. Then, he still may make the sale, but the customer is informed. In my dad’s case, he still would have bought the car charger. Even though it wasn’t as good as a deal, it was the only component he needed from the kit.
Instead, the salesman used deceptive techniques to sell someone something they didn’t need or want, but made them think it was ok.
I almost want to get the receipt myself, find out the salesman’s name, and go speak to his manager about it. Hopefully the manager would see it my way, and not be the one who taught his salesman the ‘trick’ in the first place.