The snake oil salesmen of yore were among the first to discover that oftentimes, the merits of a product matter less than how it is marketed. Madison Avenue, TV ads and infomercials, and now Internet marketers, have since turned marketing into a supreme art, designed to cleverly charm our hearts and mind, while adeptly prying loose our purse strings.
When it comes to the Internet and ecommerce, the always blurry line between providing legitimate information and conning people into buying useless products they don’t want or need has turned out to be particularly fuzzy. And credit cards, unfortunately, often play into the mix in ways that are harmful to consumers.
If you’re like most Internet users, you’ve probably had this experience: you sign up for a “free” trial offer, enter your credit card information, and try out the offer with the intention to cancel it within a few days. Then life happens, and you promptly forget all about it; until, of course, the credit card bill arrives in the mail with a pesky new monthly subscription charge on it.
For consumers juggling multiple credit cards, those innocuous little $9.97 to $14.97 charges are easy to ignore-they’re designed to be. For busy cardholders who look at their statements only briefly, it often takes months before they spot the recurring charges and/or find the time to cancel them. After all what is ten dollars? Well, sum it all up, and by the end of the year, it turns into real money.
Many Internet marketers have made an art of exploiting the fact that busy consumers often overlook charges on their statements for months before they take action to cancel them. At times Internet marketers take this practice to the extreme and cross the line when aggressive marketing practices enter the territory of scam artists.
A case in point is illustrated by one of the largest ever ecommerce scandals involving three Internet marketing companies, Affinion, Webloyalty, and Vertrue. According to a current investigation by the U.S. Senate Committee on Commerce, Science and Transportation, the three companies charged an estimated $1.4 billion to the credit cards of millions of unsuspecting American online shoppers. The shoppers had been duped into signing up for monthly subscription service without ever realizing it.
The three companies lured in shoppers during the check-out process at well-known eCommerce websites by offering them a $10 – 15 rebate offer. Shoppers were asked to simply enter their e-mail address to get the rebate. Carefully hidden in the fine print was the fine detail that by clicking the Submit button, they were opting into a monthly subscription program and authorizing monthly charges to their credit card. The ploy was particularly tricky because shoppers never had to give out their credit card information. That was passed on to the three internet marketing companies by the online retailer-in exchange, of course, for a fee.
Even as the Senate investigation continues, the companies involved have taken the offensive and hired lobbyists that specialize in crisis management, according to CNET News. In addition, they have changed their practices to make them appear more legitimate, such as requiring consumers to enter the last four digits of their credit card number for verification. One of the companies, Affinion, has announced that it will stop the controversial practice of buying credit card numbers and other information from online merchants. Several online merchants from their sides have already cut off ties with the firms, including Vista Print, Priceline, and Continental Airlines.
While most Internet marketing offers are completely legitimate, the case in a good reminder that in the brave new world of the Internet, it’s not just buyer beware, it’s browser beware. Stay clear of tempting deals when you browse the Internet; in the cyber world, as in the real world, there is no such thing as a free lunch.
While cardholders are protected by fraudulent charges arising from credit card theft, there is no fraud protection for transactions which you have, in theory at least, agreed to. Still, you can and should dispute unauthorized charges immediately, first the company making the charge, and, if it’s not refunded, then with your credit card company. If you provide legitimate reasons that the transaction was unauthorized, your card issuer will settle the account in your favor. However, be sure to take action within 60 days, as credit card companies will not let you to dispute charges more than two months old.
