Do you know what the most dangerous word for consumers is?
FREE .
More people have been cheated out of money by those four letters than any other marketing tactic that I can think of.
We all are wired to salivate when we see or hear the word free. All logic and rules of finance flee from our minds.
It is used by scam artists and respected businesses, both knowing what a powerful consumer magnet that word is.
Just think about the ads from furniture stores about free delivery, television ads about buy one product and get the second one free, electronics stores promising free cell phones.
Are these really free? Of course not.
The price of delivery is included in the furniture you buy. Ask the retailer how much they will knock off the price if they don’t have to deliver.
When you buy one item and get the second one for “free” you pay DOUBLE shipping and handling, which more than makes up for the second product.
And of course the cell phone requires a two-year contract, which if you break, could cost you $175 for the free phone.
Those are every day examples of how legitimate businesses market to us using the word free.
Now here is the latest example I received of a scam using the same phrase. In black and white it seems ridiculous, but too many have bought in to just laugh it off.
Robin of Ledyard emailed me after getting an offer from “America West” for a FREE cruise, wanting to know if it was legitimate.
“These guys called me out of the blue and offered me plane tickets and a free cruise if I come and listen to a 90 minute presentation about their vacation packages,” Robin wrote me.
“I feel nervous about it because I cannot really find information about them. They have no website and I have to leave a message at an 800 number (888-530-6243) after which someone calls me back, supposedly from Seattle. They said they have been in biz for a couple of years and want to expand into New England How do I know if these people are legit? Is this a common type of scam or a common type of perk? My husband and I are supposed to drive an hour from our CT home to Warwick, RI for a presentation this weekend. Thank you for any light you can shed!!!”
I am familiar with travel clubs which charge thousands of dollars up front and promise you UP TO 60 percent or more in savings on vacations. I have yet to see one that isn’t a scam.
But I never heard of America West, the alleged name of the company that called Robin. I called the toll-free number, left my name and telephone number, but no one called me back.
The Better Business Bureau had no record of the company either by name or by the toll-free number and could not find anything about the firm on Google.
And when I Googled the phone number, what came up was “Blue Ribbon Maids” a cleaning service out of Burien, Washington.
Based on that research and my knowledge about travel clubs I called Robin and asked her why she was even interested in attending a 90 minute sales talk.
“It all sounds real straight. They said they are a new company,” she told me.
I asked Robin when was the last time she ever got anything for FREE, other than a free sample at a grocery store. She said “I know, that is why we contacted you.”
So I explained to her the kind of high pressure sales pitches they would get – similar to the ones for DirectBuy and timeshares – and urged them not to go. I asked her to consider how a firm could stay in business giving away FREE vacations. Robin said she would talk it over with her husband.
I checked back, and they decided to heed my advice.
Keep her story in mind the next time you are tempted by the word FREE. My wish for 2012 is that we all keep it mind.
Soon I will write about the most dangerous phrase in the English language for consumers: UP TO.
Would love to hear from you about your experiences with the word FREE.
