Sunday, August 31, 2014

Do Consumers Allow Themselves to be Ripped-Off?

Through the centuries we’ve had various significant era’s from the industrial age to the tech age; but will history look back on this time and consider it the rip-off age. Has the focus on profits and profit maximisation been the green light to take unfair advantage and rip-off customers?
The energy sector has been criticised for many years for not passing on the benefits they gain from drops in global energy prices; especially when as an industry they are so quick to pass on increases in energy prices. Though there has been a lot of talk about this sector taking advantage of their customers by not passing on price decreases – it has never gone beyond talk, and customers haven’t taken up the challenge of taking on these supposedly ‘untouchable’ companies.
An article in the Daily Mail on 14th July highlighted how “Ofgem has announced that the Competition and Marketing Authority in the UK will investigate the energy market to establish if major players are taking advantage of price movements to unfairly boost profits”; and the same article also highlighted how “complaints about energy companies are at a record level in the UK amid growing anger over inaccurate bills.”
The insurance sector is guilty of reducing insurance cover, leaving consumers far less covered than a few years ago and worse still paying more for this reduced cover.
The banking sector seems to have hit the headlines on a regular basis for breaking some kind of rule to maximise their profitability and now current account customers could be paying over the odds for their overdrafts, a recent in-depth study revealed in July. In the UK the Competition and Marketing Authority recommended a full inquiry amid concerns that consumers are finding it hard to compare costs, thereby stifling competition.
It’s not just the leadership of organisations in various industry sectors that are at fault - as consumers have been aware of their treatment for years and have not had the courage of their convictions to stand up and take the fight to companies that rip them off. Possibly strategically these ‘bad’ organisations have worn the ‘fight’ of their consumers down over time, to the extent there is wide spread apathy from consumers who have no energy to take any action – believing there’s nothing they can do – so they just put up with the constant abuse by certain sectors, telling themselves that this is just the way it is.
This of course is just a green light for some organisations to continue with their poor business practices – since their customers just keep coming back for more.
Governments are also to blame for not taking a much firmer stance on many issues where consumers are clearly being taken advantage of for organisational profit – remembering that many of the executives of these firms participate in share schemes where they make money on top of their bonuses from these ‘shady’ practices.
With the consumer base being so apathetic to challenge big corporates, these sectors will continue to operate with impunity; because it’s become part of the business culture of these sectors and is sadly an expectation of shareholders. So it will take more than talk to bring some form of ethical fairness to strategies that focus on ripping off the customer in front of their eyes.
What’s unique about these industries is the majority of people believe their behaviour is unfair to downright criminal and yet nothing is done to rectify the situation and protect the consumer. Even those reading this far will be feeling apathetic to the situation and it’s a lot worse for the older generation – where we’re actually asking the elderly to be street smart and business savvy which is just so unreasonable.
Nothing is likely to change until consumers start standing up for their rights and using their group consumer power to force ethical change – until this happens, consumers will continue to moan amongst themselves – but nothing will actually change until they make a stand.

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