How Office Depot Pushes Service Plans On Customers

Harry writes "I was amused, appalled, and angry — yes, all three — when I spotted signs above every register at my local Office Depot with handy scripts for clerks to use in 'recommending' that customers buy extra-cost, extremely profitable protection plans. And now Laptop Magazine has posted an eye-opening investigative report that charges local Office Depot stores with instructing staffers to lie and tell people who want to buy laptops without service plans that they're out of stock." Update: 03/13 00:53 GMT by T : An employee with Office Depot, somewhere in the southeastern US, wrote to respond to this story as a employee of the company, but in his off time and not in any official capacity: "I will only say that what is described in your article and the Laptop Mag article is not something that occurs across the entire company as sanctioned or ordered by the Corporate Higher Ups and is certainly nothing I have experienced as a 10-year employee of the company, we want sales. Yes, we want add-ons, but we will take the sales regardless."

Comments

Best Buy tried this as well to "fight" piracy.

[Doug52392]

About a year ago, I walked into a local Best Buy, and was shocked, appalled, angry, but not surprised, to see anti-filesharing propaganda set up throughout the store.

I counted over 25 fliers hanging on walls, telling people "DOWNLOADING IS A CRIME!", and other propaganda. The most elaborate display they set up was in the MP3 Players section of the store. They mounted two flashing strobe lights on top of a display, designed to look like a police car's flashing lights. They then placed a large sign stating that "DOWNLOADING IS A CRIME. DON'T GO TO JAIL, DON'T DOWNLOAD".

So I asked one of the employees about the signs. They said it was an order by their upper management (as in, from their corporate offices). I then asked if they believed that downloading music is a criminal offense that can result in arrest, as they clearly try to say. They did not know. Some of them said "Yes", while others didn't answer the question.

Needless to say, I guess people complained, because the signs were gone after a while...

I bought mine... at Circuit City

[PCM2]

Believe it or not, I bought my current PC at Circuit City. I know, I know. But at the time, Circuit City had the same model HP Pavilion for as little or less than anyone online, with the additional advantage that I could jump on the bus and go buy one today, rather than having to wait around for UPS to deliver it. A week later, Amazon.com dropped the price by $50, so I went back to Circuit City and said, "Hey! I you guys ripped me off!" The nice kid at the cash register promptly credited $50 to my card. Total time without a working computer: 18 hours. Total money lost due to not shopping online: $0.

Am I sorry they're out of business?

I dunno. Not really.

Re:Company or store policy?

[sahonen]

I worked for OfficeMax a few years ago. Everybody who worked there received commissions for selling those overpriced plans to customers.

OfficeMax was my shitty high school job, I had the same thing... I don't think I'll ever forget the poor customer who bought the protection plan on a $5 mouse because I was following the script and she didn't know how to say "no." I stopped following the script after that.

A former employee

[UnrealisticWhample]

A few years ago I worked at Office Depot for about a month while I was looking for other work. I was hired on as a stocker, though they'd occasionally have me cover the computer department when we were short staffed. At our store, management set a quota for each employee for how many service plans we were supposed to sell each week with a required Saturday morning training session for any employee who did not reach their quota where we would do crap like train on these scripts and brainstorm incentive plans on how to motivate us to sell more.

I went to one of these stupid meetings and all I could say for myself is that since I worked as a stocker in office supplies, I didn't even sell anything that I could in theory have pushed a service plan on, even if I didn't think they were crap. They responded that I was mistaken because batteries were in my department and they qualified. WTF? How the hell are you supposed to sell a service plan on a pack of AA batteries? I quit before the next Saturday as I'd found another job, though I probably would have given them notice if it weren't for the crappy work environment.

Re:A former employee

[Akili]

About a decade ago I worked for Staples, in their business center.

I witnessed, firsthand, a 'model' employee taking a printer out of a customer's cart when the customer revealed that they weren't going to buy the money pit of an extended warranty plan! Subsequently telling that same customer that the entire wall of boxed printers was on hold for 'a school' was the icing on that particular cake.

Our store had the best rankings in the district because 'we' flat-out refused to let warranty-able items go out the door without a warranty being purchased. While the official store policy was never to use those sorts of tactics, there was a sheet that was distributed to each store in a given district, posted prominently in the break room, ranking each store by how well they did selling those warranty plans, and the best store got awards and the like. Kind of a we don't condone this behavior, but if it gets results, we'll pretend not to notice arrangement, it seemed.

I got in some hot water for not pushing those warranties - I sold perhaps one a month, usually because the customer wanted it - but I had other good employee qualities that they apparently decided were worth keeping me for.

Anyway. I have no idea if they still do such a thing, but it's not a new idea.

Re:Company or store policy?

[Ethanol-fueled]

Obviously, the employees hate that shit as much as the customers do.

Yes! Laymen, please keep that in mind the next time you get that crap from one of us working that shit job. Also know that those bullshit policies are often enforced by secret shoppers. Secret shoppers are people who work for agencies who are paid by the company to monitor employee behavioral compliance.

OfficeMax didn't have them then, but the drugstore chain did. In that case, the random weekly visits measured for all of the employees working in the store(YMMV):

Did the employee greet you with a smile?
Did the employee ask you if you found everything you wanted?
Did the employee offer to take(or call somebody to take) you to the item?
Did the employee offer a friendly parting comment?

I never found out for sure, but I've heard that store managers receive bonuses for keeping payrolls low. My store manager was paid 63K a year while the understaffed underlings often work for minimum wages. Keep that in mind the next time you visit a drug or grocery store with 30 people in line being served by only 2 cashiers.

Re:The More You Read the Uglier It Gets

[vindimy]

Everyone talks about Circuit City, and indeed, these news are nothing new... Every electronics outlet does that to stay competitive, no? If everyone steals, you either steal too, or go out of business.

Here's an account of a former Circuit City employee.

Not News

[hduff]

When did we forget caveat emptor and expect the seller to be fair and do business in our favor all the time?

• The idealism of consumer-focused selling always falls prey to reality.
• We demand low prices that result in low profits, so a business needs to find some other means to generate profits.
• "Selling what we have" will prevail over "Selling what's best for the customer" almost every time.
• People lie and cheat to achieve their goals, especially when their goals are at contretemps to the other party and they'll lose their jobs if they aren't successful.
• Buyers always have a choice; complain and/or vote with your pocketbook/feet.

I once worked at a bank that set high goals for the "sale" of credit life insurance on consumer loans. Without exception, credit life insurance obtained through the lender is a bad deal for the borrower and a great deal for the bank - DON'T EVER BUY CREDIT LIFE INSURANCE. If the borrower "asks" for it, the premium is not counted in the A.P.R. calculation; if it is required, it must be part of that calculation, vastly inflating the A.P.R. Guess how much credit life was sold as "asked for" and how much was sold as "required"?

We were instructed as to patently illegal and devious means to write it as "asked for" while the bank President stood in the room. The one fellow who questioned the practices was fired within the month. I left shortly thereafter.

It happens everywhere. That's the sad, harsh real world.

This is not news.

"Office Depot Provides Legitimate Extended Warranties At No Extra Cost" would be news.

Re:Company or store policy?

[Yeef]

I used to work at the local Best Buy and, like most big retailers, they had us pushing the service plans and other stupid add-ons (magazine subscriptions, credit cards, etc). While they never told us to lie, they'd often tell us to omit mentioning any potential negatives unless the customer specifically asked about it.

Best Buy employees don't work on commission, true, but of course they gave more hours to the people that managed to get more customers to sign up for service plans. There's nothing wrong with that. Now, most of my co-workers were honest people; it wasn't uncommon to see some of them give the customers faulty information, but it was usually out of ignorance rather than trying to purposely be deceptive.

There was a handful of people, though, that would tell outright falsehoods to customers to get them to get a service plan or what have you. There was one employee in particular that would sign people up for the magazine subscriptions without even asking then (the 'free' trial that they charge you for after the 8th week if you don't cancel).

Of course, since I worked Customer Service I was the one who had to deal with all of the angry customers. Easily the most stressful job I've ever had. On the one side I had customers venting their frustrations at me. Then, with the way Best Buy's hierarchy is set up (there were about 12 managers, all with the same level of authority and conflicting sets of instructions) it was chaos trying to figure out exactly what they expected from me. So, I simply stuck to the official store policy and, of course, I got 'spoken to' (but not written up, because they really wouldn't have a leg to stand on) for accepting too many returns even though I was following company policy to the letter. After putting up with that shit for two years, I'd finally had enough and quit.

I suppose I'm going off on a tangent here, so let me get back on topic. I think that, with the exception of a few people, most retail employees loathe using lying to people, even if only through omission. Unfortunately, the way the system is setup, there isn't really much of a choice. I was fortunate enough that I could afford to quit a job that I hated (and that was back when the economy was still relatively good). But not everyone has that luxury. If you have a family to support or are a student paying your own tuition (as a lot of my co-workers were) it's not really an option. When I was working at Best Buy, the only people there that seemed to genuinely enjoy their job, other than the managers, were the people working in the warehouse (away from the customers). Most everyone else just sort of begrudgingly accepted that things could be worse and did their best to bear it.

Re:Company or store policy?

[LaskoVortex]

Could you be any more insulting to your species ?

Yes, of course he could. He could offer them a protection plan they don't need. I'd call that a first rate insult.

Re:Company or store policy?

[sahonen]

Much better, you're up to 7/10, and actually worth replying to.

Also, the GP didn't say how much the warranty cost.

I don't remember exactly, but far more than simply buying a new mouse when the old one fails, especially considering we're talking about devices with no moving parts here. I've never had an optical mouse fail on me under normal use. Also, depending on how you value your time, spending the hour or so digging up the receipt and waiting on the phone, going through whatever procedures they require for you to get your replacement... It's simply not worth spending that kind of time on something you can pay for out of pocket by just working for 15 minutes.

If it weren't for competitive strategies such as that we'd all still be paying $50 per mouse like we were 10 - 15 years ago.

Yeah, advances in miniaturization and manufacturing techniques have totally had nothing to do with that. I suppose you think the reason I've got more computing power for a third of the cost in my iPod Touch than my desktop machine had 15 years ago is because Apple sells warranties too!

Insinuating that people are somehow idiots who can't think for themselves, and that companies prey on them is WAY more insulting.

I suggest you take a hypnosis class some time, you'll learn that even your average person is fairly suggestible. On the low end of the bell curve there are people you can sell *anything* to. There's enough weak-willed people out there that a good panhandler can live in a house.

Re:Better Question

[schmiddy]

Where is it, again, that I can put blow on my credit card?

Glad I could help. On a serious note, if you're the sharp type and good at reading fine print, you can occasionally make money with "credit card arbitrage" by taking advantage of 0% APR balance transfer options. Not for the faint of heart, of course. Or you can take advantage of the US Mint's offers to sell dollar coins at face value with free shipping to skim credit card rewards points.

Re:Better Question

[IANAAC]

Buy from a national chain, and the money flows outward, probably never to return to your region/city/neighborhood. For every $100 spent at a national book chain, only an infinitesimal amount remains locally (something like $10 or so). Buy from a local book store, and at least $45 remains in your neighborhood. Which means more employment, etc., etc. Dig????

Great! Point me to a local, non-national chain store to buy a netbook or MID (or laptop, for that matter) and I'm totally there (oh, and I should add at an attractive price, since that's usually what takes people to national chains).

Look, electronics and books are two very different industries and you just can't compare them. Books can be and are sometimes published and produced locally. I don't know of any local, US-based place that produces the electronics I would use. Dig?