Sometimes we just really need to stick up for each other. So there they were, just before Christmas, two friends struggling with a store guy to get a refund after being slipped a useless extended warranty.

Becca had been upsold. “I really did feel subtly coerced into purchasing the warranty by a lovely and very helpful young man who sold me a cheap laptop and tablet.”

Upselling is that sales technique where we get offered another related product just as we’re buying something. “Want fries with that?” is perhaps the best example of all time. It’s extremely effective.

“He really was on my side and looking out for me – that’s what I was led to believe anyway.”

Still, there’s something shady about it. Here’s why: studies have shown that something called “decision fatigue” is real. Making choice after choice is downright draining mentally.

So if we’ve been exhausting our brainpower on selecting the right laptop – comparing features, prices, etc. – we’re more prone to being upsold an extended warranty we’ll never use. We spend our mental energy on the first choice, without realising that there will be another to make that will need our full attention, and without much time to think, either.

The best upsells are supposed to give us some additional benefit to our original purchase, which is why extended warranties make good candidates. But in Becca’s case, when she looked at her receipt afterwards, the warranty was not what she thought she’d bought: it was for one year, not three; it didn’t cover the full value of the computer either.

And here’s the thing: that laptop was already covered under the Consumer Guarantees Act, which gives us the right to expect that our purchases will last for a reasonable amount of time. And this applies for most things we buy. The Fair Trading Act also gives us the right to change our minds on extended warranties and ask for our money back within five working days.

“So I asked for a refund after everyone in the office was aghast that I fell for it,” Becca says.

Now it helps to have friends in high places, or at least one whose job it is to let people know about their rights as consumers. And it certainly also helps to be able to whip out a smartphone and dial up the Consumer Guarantees Act when you’re aiming to get your money back. Yet the salesperson almost convinced Becca to keep the warranty.

“If Clem wasn’t with me, getting out her phone to show the Consumer Guarantees Act to the store guy,” she says, “I would have lost the gumption.” After what seemed ages, the refund finally came through.

When the successful pair left, the store guys were scratching their heads, not quite sure what had just happened. “So that lady just asked for a refund on the warranty? But she didn’t return the laptop? What’s up with that?”

Apparently this sort of thing doesn’t happen as much as it should. Who knows how many needless warranties we’ve all been upsold over the years?

 

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Comments (5)

  • Tania

    10:28am | 16 Mar 2016

    Thanks for this info. More people need to know about this type of marketing. The tactics for selling crap is just getting worse and worse these days.

  • Tom

    3:40pm | 2 Mar 2016

    Hi everyone, thanks for commenting. Cross-sell or upsell? Upselling is adding more to something being bought right then and there; cross-selling, instead, is selling something completely different to a customer, even at another time. The classic cross-sell we see is when you go into your bank to cash a cheque and you get sold the bank's KiwiSaver scheme. Cheers

  • anonymous

    3:39pm | 2 Mar 2016

    What a load of crap, if you din't get an extended wty on a laptop you are a f*ckwit. Spent 5 1/2 years selling laptops, and always purchased the extended wty because without it if something major goes wrong you night as well just chuck the laptop in the bin! I know the costs on repairs, especially on laptops! The consumer guarantees act does not give you the coverage that you think iot dose. It is vaugely worded and out of date. Once you have had the computer for 6mths good luck!

  • anonymous

    3:38pm | 2 Mar 2016

    I worked in retail for years, and the employees are demanded to up-sell anything and everything they can. They have targets to meet, i.e. at least two warranties a day, one add on to every major product, and if they do not meet those targets, then they cannot reach the second pay scale or miss out on bonuses and other opportunities. I agree that it is wrong, but it is usually not the employees' fault. They are just doing their job - what they have been trained to do. Also, they do not receive training in the consumer guarantee's act, and if customers would read the act properly, they'll find it doesn't cover everything that they thought it would cover. Too often, customers quoted that act to me, and actually, they knew nothing about it. They just thought that it would automatically side with them, as the consumer. So, really it is the CEOs of such companies who are demanding more profit, more sales, and who are then dictating this to their employees, who actually just want to keep their jobs.

  • Sylvia Bowden

    3:38pm | 2 Mar 2016

    I bought a cell phone on contract for two years. After just over 12 months it broke down. It was out of the manufacturers warranty. After I did some research I found out that under the consumer guarantees act the phone should last for two years because I had a contract for two years. I took it back to the retailer and asked it to be fixed at no cost- I got 'it is out of the manufacturers warranty etc". However, because I knew (and showed them the relevant part of the act) the retailer did fix it and lent me a phone until mine was fixed. The sales assistant had never heard of this before I pointed it out.