Consumers on top or bottom?

By Michael Fraase

Sunday, 10 August 2003 04:15PM CST

Section: Business

The Washington Post needs to get its story straight. “We’re Empowered, By the Internet and Intense Competition” says the consumers are on top. Same issue, same section, same page; “We’re Manipulated: Marketers Pounce on Our Weaknesses” says consumers’ sense of empowerment is all an illusion.

Margaret Webb Pressler’s rah-rah piece on consumers being in charge maintains that we’ve managed to wrest control from the distributors, manufacturers, and retailers; in that order, since the late 1700s. Pressler sources from Roger Blackwell, a marketing professor at Ohio State University, who amazingly opines that “Today WalMart asks the consumer what should be on the shelves.”

On the contrary; WalMart, in most parts of the United States, determines what our kids see and hear.

Neither Washington Post piece bothers to mention how WalMart bans outright certain material from its stores and bullies mainstream recording artists and authors to create “sanitized” versions of their work for sale within the vaunted aisles of the mega-retailer. In cities large enough to support independent retailers, it’s an annoyance; in locations where WalMart is the only game in town, it’s much more than that.

Meanwhile, Dina ElBoghdady’s article points out that the bulk of American consumers are too lazy to file rebates with manufacturers, calculate the cheapest interest rate, or avoid late fees. Rebates are everywhere because manufacturers understand that only 5% - 40% of all consumers will redeem rebates. And only a small percentage of those will complain if the rebate doesn’t materialize. Credit card companies have been pressured by “consumer preferences” to abandon annual fees and now make up revenue on late fees. To the tune of US$8 billion per year, accounting for about 8% of total revenues (annual fees accounted for only 3% of total revenues).

Top or bottom? It doesn’t much matter—we’re getting screwed coming and going.

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