Business might sound simple but there are a lot of strategies that are to be followed.
The good people of Reddit were recently asked what shady business tactics they’ve seen used, and the answers they gave may shock and disturb you. Whether you’re in business yourself and have seen it all, or you’re a regular customer who’s curious about where your money is going, you need to be aware of these dirty tricks in order to avoid them.
Take a look:
#1. “Every month” and “every 4 weeks” sound similar, but are different. Paying every month gets you 12 payments, every 4 weeks gets you 13
#2. TL;DR: Planned obsolescence and all the different types, with examples.
Planned obsolescence. Basically, products are designed by manufacturers to “wear out” after a certain period of time or amount of use. This is done to force consumers to re-purchase products or purchase new versions of products.
There are a few types of planned obsolescence. First is contrived durability, which means a product is designed to deteriorate quickly. A great example is how disposable razor blades wear out so quickly.
The second type is prevention of repairs, which means a product is designed in such a way that it is either made to be a single-use item (like disposable cameras), or in a way that uses proprietary hardware to prevent repairs and even damage the products if repairs are attempted. Apple is guilty of this with the majority of their product line-up, even seeking legislation to make it illegal to provide the difficult repairs.
The third is perceived obsolescence, which means a manufacturer frequently releases new “versions” of a product to make consumers feel as if the old product is far inferior. This is incredibly common, and in the grand scheme of things, fairly harmless. This type of planned obsolescence doesn’t force a consumer to purchase a new product, but rather coerces them to, as do many other marketing campaigns. Common examples include new cars, phones, televisions, apparel, etc. for which new versions are released frequently.
Fourth is systemic obsolescence, which is when a manufacturer deliberately attempts to make a product obsolete by altering the system to make regular use difficult. Many people, including myself, accuse Apple of this when they release a new iPhone. Many people find that their old iPhone begins to run slowly after the latest iOS update following the release of the new iPhone model.
Last is programmed obsolescence, which is when a product contains a mechanical or electrical system that limits the amount of uses the product has. One notable example is printer cartiriges which use software to limit the amount of pages they will print, regardless of the actual ink level. Hewlett Packard was sued on allegations that their ink cartridges would “expire” on a certain date.
Altogether, these practices create an abundance of waste and unethically force consumers to buy more “stuff”. This is a great way to make money hand-over-fist, and it is far more common than most people may think. People often complain that “things just don’t last as long as they used to,” which, excluding survivorship bias, is true because they are built not to.
#3. Not sure if this fits, but if you are offered a raise for taking on new responsibilities, get it in writing. Just learned that the hard way.
#4. I waited tables in a restaurant and one time I decided to pour a cup of soup into an empty bowl (a bowl of soup costs a good bit more than a cup of soup at the restaurant). The cup filled up the bowl to the top.
#5. Mattress stores that have the “find it anywhere else for cheaper, you get your money back!” deal contract with the manufacturer to make the exact same model of bed, but with a model name specific to that store, so nobody can ever cash in on that deal.
#6. I know a guy who does pest control who specializes in raccoon removal. He takes the raccoons from one house in one neighborhood, then takes and releases it in another neighborhood then waits for the people there to reach out to him to remove the raccoon from their home.
#7. I worked in the collections department of Discover Card for a while. One thing they did (maybe still do), to lure customers to them is offer 0% APR for the first year. People would jump on this and transfer all their debt onto their new Discover Card, and then the company would “conveniently” not send the first month’s bill. In the fine print of the agreement, it states that if you miss even one payment in that first year, your APR will jump to 29.95%. Half of my calls were to these new customers who would then proceed to throw a fit, because they didn’t ever get the bill, and I had to explain to them that it was their job to know when the bill was due, and sending one was just a courtesy extended by the company. I hated hated hated that job. It ate away at my soul.
#8. When I was in the process of moving into my current home I transferred the title of my old home and land to my sister because she was buying it and moving in when I left. Within the next few weeks she started getting all the “welcome to the neighborhood” coupons and flyers. She didn’t even change her address, so I assume companies track title changes with the register of deeds. The sketchiest was a pest control company claiming to have an existing account on the property and recommending she continue to use their services. They detailed dates and changes; referenced termites. It was all lies. All the dates shown were while I owned the property and I never even heard of this company before she received that letter.
#9. I was a waitress at a family-owned restaurant that paid me $0.10 more than the minimum wage. They were able to require me to turn over all tips that I never saw again because they paid me over minimum wage. I think this is technically legal, but sleazy nonetheless. I made really great tips and it was hard turning the money over. It’s also pretty deceptive to the customer, who thinks their money is going to the wait staff, not the restaurant.
#10. Many companies claim to be environmentally friendly by putting made up certifications on their products. Like a frog in a circle that says “rainforest friendly.” There are very few legitimate environmental certifications. It’s called “green washing.”
#11. If you’re buying a used car and it’s parked over a puddle – they don’t want you to look underneath.
#12. When finding a home for your elderly parents, set up an appointment but come in a few minutes early and say (don’t ask) if you can walk around for a quick look. The receptionist likely wont refuse you, and the sales person won’t be ready for you. These places like to show you only the stuff they want you to see when being led around by a sales person. Chat with a resident or a staff member, they’ll be the most honest with you.
#13. If you’re buying a used car – or any car for that matter, the check engine light should temporarily come on when you start the vehicle. If it doesn’t, the dash has been tampered with to mask a potential issue
#14. I bought a swimming pool several years ago. The slime-ball sales guy was using all the tactics. Last few days of sale, need to put money down today. Yada, yada. This was a major purchase and it irked me the way he was trying to pressure the sale.
I ended up going to another branch of the same pool store and buying the pool. It came out to a few hundred dollars difference.
I had an occasion to stop in the first store as the install was happening. Needed some sort of part or chemical. The original sales guy recognises me and ask about the pending sale. I said “I bought it off the other store because you said the sale was ending. I figured maybe they where running the sale longer” His eyes about blew out of his head. The girl at the register was giggling the whole time. As he stormed off she said” Now that was funny” I just smiled back and walked out the door.
#15. The higher priced items like prime rib and seafood is typically at the end of the buffet line and cheaper more filling options like bread and mashed potatoes are at the front. They hope you fill up your plate space/stomach space by the time you get to the high ticket items.
#16. When I was working in sales this is what they taught me to psychologically trick people into buying whatever shit we were selling. Strap in, this could be long.
First up, everything I learnt in sales worked through what they called ‘impulse’ selling, which means playing on people’s tendencies to make a decision based on their current state of emotion. Salesmen will build your level of ‘impulse’, and then ‘close’ you. The ‘close’ is the point at which they seal the deal, and you give them your money in exchange for whatever they have convinced you that you need.
There are five basic ways that salesmen will ‘impulse’ you. The acronym they taught us was G.I.F.T.S.
The first was ‘Greed’. People are naturally greedy. By which I mean they want more for their money. They want a good deal. If people think they can make or save money, they are more inclined to buy. An example of this is basic ‘half price’ or ‘buy X, get Y free’ sales.
I stands for ‘Indifference’. People can smell desperation. If they sense that you have a motive for wanting them to do something (like buy) they will be more wary, and want to know your reasons. Therefore, a salesman will try to make it seem as though they do not care whether or not you buy (even if they are on commission). After all, they are only offering you this amazing deal for your own benefit.. They have nothing to gain..
Third was ‘Fear of Loss’. Causing people to worry that they will miss out if they don’t buy. This can be exploited by making people think that this is their one and only opportunity to purchase at a ‘reduced rate’, or used in conjunction with ‘Greed’, for example ‘buy in the next 60 minutes and get X free!’.
T, ‘The Jones’ Theory’. If your community is getting on-board with an idea, there is no reason that you shouldn’t too. It’s safe. ‘It’s all the rage’. ‘Everybody’s doing it’. ‘Don’t miss out’. This also ties in with ‘Fear of Loss’.
The last one is ‘Sense of Urgency’. Can be used in similar ways as ‘Fear of Loss’, i.e. ‘buy in the next 60 minutes or else X’, or as subtly as a salesman saying that they have other appointments and won’t be able to come back and offer you this deal for a too-long period of time. A sense of urgency causes people to buy more impulsively, especially when coupled with a fear of loss.
Once salesmen have ‘impulsed’ you enough, they will try to ‘close’ you. I was also taught a number techniques to ‘close’.
The first was the ‘assumptive close’. This is basically assuming that the person will buy and filling out the paperwork. A common example of this is a salesman simply asking for your your name, and the proceeding with the sale. They will fill out an entire form and then just ask you to sign at the end.
This is often assisted by the ‘trial close’, where a salesman will slowly push you over the line, while at the same time testing you to see if you are ‘impulsed’ enough to buy. They will do this by asking you closed questions, aimed at steering you down a conversational track which leads to a sale. Charity workers do this a lot when they ask ‘Do you like dolphins?’ (yes), ‘Do you think dolphin’s habitats should be protected?’ (yes), ‘How much do you spend on beer / tea / coffee a week?’ ($5-$50), ‘Do think you could put $X towards saving the dolphins?’ (umm, well, I guess you got me there..)
Another powerful close is the ‘alternative close’, where salesmen will offer you one of two choices, both of which result in a sale. ‘So would you like the regular option or the slique-deluxe?’. Often presented assumptively (see ‘assumptive close’).
The last was the ‘silent close’. Harder to use, but effective with indecisive buyers or people that pull back when pressured. Basically presenting the overwhelming positives with the easily countered negatives, and then shifting control of the conversation to the buyer, and forcing them to say ‘yes’ or ‘no’. Obviously, the salesman has presented the information in such a way that you would be stupid to say ‘no’. After building tension and excitement for the product, they let you come to the decision themselves.
Almost every person who sells goods or services has been taught something along these lines, and the most successful salesmen have this information at the forefront of their minds when they are selling to you. Never forget it. These people just want your money, they honestly do not generally care what you get out of it.
#17. Some stores increase the price of a product and then put it “on sale” by a percentage of the fake higher price.
#18. The “closing down” sale in the shop that never closes down. It’s just in closing down sale mode continuously.
I’m amazed shops are allowed to get away with this.
#19. In France it’s hard to fire or lay off people, so when big companies need to clean house a bit, they move the office to a new location quite distant from the current one. In the process they reduce the office size from 50,000 seats to 30,000 because they’ve estimated that amount of people will resign rather than endure a 4 hours commute… But officially “totally you still have your job if you want, we are not laying you off, but I need you in the office everyday… Or you could resign if you don’t like the new location…”
#20. Making you pay more for printing your own damn tickets at home.
StubHub, ticketmaster etc.