Although we all want to take advantage of new online deals, a new study has revealed that most sellers could be dishonest to consumers. For instance, the collaborative study revealed that almost a quarter of vacuum cleaner sellers on amazon has, on a given occasion, lied to offer discounts. Still, in a real sense, they increased the price.
Sellers on Amazon deceive sellers with discounts but charge high prices
According to researchers from the Universities of Florida, Arizona State, and South Carolina, most Amazon sellers will also add the previously unstated “list price” towards the listings while increasing prices. In order to give customers the idea that they are getting a good deal, the site crosses out the significantly higher retail price.
The researchers found that this strategy deceives consumers into believing they are receiving a bargain when, in reality, they are spending 23% more on average for a vacuum cleaner than they would have paid one day before. Several days afterwards, the price is reduced, and the false claims regarding the retail price and discount are no longer present.
Interestingly the tactic doesn’t apply to vacuum cleaners only. The study found that drones, blenders, books, and digital camera senders also use misleading tactics but not as much as vacuum cleaner sellers. Interestingly, the false discounts result in more sales that, in turn, contribute to the improvement of the products’ sales rankings on Amazon.
Deceptive pricing is illegal according to regulations.
One may wonder whether the sellers’ actions are legal. They are illegal according to regulations that ban deceptive pricing strategies and require sellers to show true price comparisons. Consumers have in the past filed class action suits against sellers such as Ann Taylor and JC Penny for promoting discounts with deceptive values shown for price comparisons.
However, with present sales schemes, it doesn’t always meet the categorization as a lie. This is because prices can sometimes be truthful and misleading simultaneously. For example, a seller can sell at a low price without list comparisons, and it only becomes deceptive when they display comparisons.