Are you a victim of the "Negative Option?"

06/05/03 - Interested in checking out a few of the latest automobiles, you stop by a luxurious showroom. There they are - some of the hottest and most expensive models. You slip behind the wheel of the snazzy red coupe - and then it happens. The salesperson is in your left ear suggesting, "How 'bout a test drive?"

"What can that hurt?" you say to yourself. "I really want to feel it on the road."

"Come with me while I get the keys." You follow the sales person to the "check-out" desk, and they ask for your license, your identification and your insurance papers. Nothing out of the ordinary here - you are taking a test drive in a $65,000 machine. 

You sign the little form they present - not taking the time to read the whole thing. The road is waiting! Five minutes later, you're pulling out of the lot - and on to a few minutes of the rush that only a fine machine can bring.

That night, you dream of the afternoon ride - then you wake in a start when that sane quadrant of your brain kicks in to remind you of the payments, the license fees, the insurance premiums, and the depreciation. Your feet hit the floor as you say to yourself, "Thank God - I could have actually bought that thing!"

You think of your faithful old car - and go to the window to give it an admiring glance as it sits waiting for you in the driveway. But what's this!

There beside it is the red bomb you test drove yesterday. What the heck is going on?

The answer is right under the new bomb's windshield wiper. It's your invoice - for $71,460.36 - escalated by taxes and options. It says, "Welcome to your new car! Since you didn't say 'no" after your test drive - and our little form said we'd deliver your car if you didn't decline it, we've set up your payments for only $1,500.00 a month." Your credit was fine - so welcome to the open road".

Sound ridiculous? Well that's only because car dealers haven't latched on to the Negative Option.  While they haven't - almost everyone else has. It's especially prevalent with so-called "clubs" for CD's and other items - and for magazines and other periodicals.

Somewhere back in time - a devious marketer realized that people have no concept for just how fast time flies. Even better - for this form of marketing - folks rarely have time, the skills or the inclination to go through the detailed process of telling a firm they DON'T want something they've tried. Few know "how" to stop them from sending the goods. It gets even worse when things received must be returned to end the billings.

This little scheme - first used in the days of radio - has matured to be a multi-billion dollar issue - now being taken on by lawmakers because of the deluge of justifiable complaints. Some states already have consumer protection laws - but overall - the practice still thrives. Not surprising - this sales approach has the highest acceptance among those who seek something for nothing. Unfortunately - for them - this type of consumer often accepts multiple offers for "free" trials, forgetting to decline in the allotted time. This makes their names even more valuable as a direct-marketing target - and firms make lots of money just selling the contact information for those who accept.

Certainly, one's first defense is awareness. Whenever receiving a "free trial" offer, check to see if you will be charged for anything at all. Most of these offers charge your credit card - or send you a bill - the moment you accept the free trial. To avoid or recover the charges, you must embark on a ritualistic mission - documenting each step of the way. Some say this is as easy as a toll-free call. The easiest way is to simply decline the offer - while asking the firm to remove your name from their list.

We urge any company considering the negative option as a marketing campaign to look ahead - to probable federal and state regulation, fines, customer dissatisfaction, and high servicing costs. The scheme is "worth it" for only the most practiced perpetrators - the ones that have finely tuned their "modus operandi."

The opposites of the negative option are the no risk free-trial and the satisfaction guarantee. The correct use of these marketing approaches has made millions and established a happily-satisfied customer base for thousands of companies - large and small. Contact us to talk about the ways these tools can benefit your business ... and what to look out for.

That's it for this month. Thanks for tuning in - and if you have some comments - we'd enjoy hearing from you.



William H. Thompson
Principal

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