Pricing Errors

[GoldenEggs]

Last Sunday, Nov. 16, Target had an incredible deal on Britax carseats. Normal retail price is $279 and two styles were on sale for $42.99 and qualified for free shipping. A lot of the mother, baby, pregnancy boards that I frequent had threads letting moms know about this deal. Some people bought one, others bought several for resale purposes.

It turns out it was a pricing error and Target emailed a lot of people saying that the order would be cancelled, since the actual price should have been $279. A lot of parents are upset and I believe the attorney general in New York is looking into the matter.

http://www.whec.com/article/stories/S668882.shtml?cat=0

Some of the parents are angry because Target's customer service gave conflicting answers, some parents were offered the opportunity to buy the carseat at $199 and some parents supposedly already received the carseat at $42.99 with the free shipping.

I usually let the customer know that the item was priced incorrectly but that their credit card had not been charged and give them the option to buy it at the correct price. I'm curious how everyone else deals with significant pricing errors.

 

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[Luke12321]

I had this happen when I was shopping for a car. It was a really good deal but not like a 50k car for 5k. Anyways, I called the dealership and was ready to drive to GA but he said they put the wrong price. May have been a marketing tatic to get people to call, no clue...he did not try to get me to come down though.

I guess I would look at the situation. If you own a business that is profitable, one or two orders at a loss probably would not kill your biz. If it was just a few orders, you could probably work out some sort of deal with the customers. When a big retailers messes up, they are probably THOUSANDS of orders. I would try to work it out with my customers though if I was a small business who made the mistake. Chances are, your customers will just complain a bit and then either decide yes, I still want to buy the item or no...I was trying to get something for nothing.

 

[kimberland]

Yep, I'd explain, apologize,
give them a lower priced freebie
and move on,
because as you mentioned,
some of the buyers of the carseats
were simply reselling, trying to make a fast buck.
Those aren't real customers.

And real customers will know the pricing is a mistake.

Oh, when I called to explain
I wouldn't say the company made a mistake,
I would say I made a mistake.
I don't know what happened, I usually catch it... etc etc
Make the mistake human.

 

[biophase]

I had this happen to me on my one of my online stores. For some reason, a line of products was on sale for 80% off. So a $500 product was listed at $100 on my store. I found out when I got an order for $100.

I just emailed the customer and told them that there was a pricing error and refunded the money. He didn't complain or anything. I will offer him the product at my cost once its back in stock. I'm not sure what I would have done if he complained and wanted it for $100.

 

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[randallg99]

So, lemme get this straight: People want to buy something for next to nothing and the company apologizes for the mistake.... and now those people are rallying to get the Attorney General involved because they want something for nothing.

this behavior epitomizes scum. People need to understand that mistakes happen.

This happens often in my business where many items are customized. Rarely are customers upset with price differences when they're called to discuss the issue.

 

[Bilgefisher]

Unfortunately people are going to see the big bad corporation scoffing over a few hundred bucks. I think many folks cannot see outside their narrow field of vision. But, you cannot change this mindset, so how can business owners adjust?

I don't have an online store, so I ask, what can you do as a business owner to correctly fix the mistake, without completely upsetting the average customer? Remember for Target, that $279 product actually represents much more. Think about what the average person spends at target in their lifetime.

I recently had a sears furnace installed. The salesman said my furnace represents 25-30k worth of future purchases with them. He wanted to make sure I was a happy customer. I was impressed with that line of thinking.

 

[GoldenEggs]

Personally, I havevn't been so upset by a pricing error that I've demanded to see a manager or write a letter to the store. Mistakes happen and sometimes there are people who just like to mess things up. I had a friend who used to switch around stickered prices so that she could then afford to buy something. Sometimes the cashier would realize that the item couldn't be that cheap and refuse to sell it.

I think the problem with the Target error is the customer service. There were so many conflicting answers being given, yes $42 is the right price, no it should be $279 or well, you can have it for $199.

What I think is interesting is that Target also had another pricing error on a snowthrower for $15 (retail price $299) but I haven't seen people up in arms over that.

 

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[Jill]

Mistakes are mistakes. They happen. Most reasonable people understand that. If they don't, then TRUST ME, you don't want them as customer. They will be far more trouble than they're worth. (See this section from Tim Ferris's 4-hour workweek - or ask me for personal experiences!!!)

The only exception I would post is with regards to companies who advertise a product for an exceptionally low price to get you into the store, then inform you ( 2 hours after the ad was released) that they are sold out. The ol' bait-n-switch. When this happens, I have no sympathy for the retailer. Athough, if they had a single piece of the merchandise in inventory when the ran the ad, you probably won't have much grounds to sue. But you can still punish them for the deceit.

 

[kimberland]

That's why I advised to
have an individual within the organization take the blame.
He/She should send out the emails.
He/She should make the phone calls.

It doesn't even have to be a real person.
Telemarketers do this all the time.
'Sue' is the returns lady.
There may be really 300 'Sue's'
but it puts a human face on the company.

Not many of the email or phone support people use their real names.
Not that many Robert's in India.