WEBVTT 00:00:00.000 --> 00:00:03.280 It says 5'1", he should fit in our server rack. 00:00:03.280 --> 00:00:09.760 No, it's starting at 5'1", and here it's listed as up to 7 feet. 00:00:09.760 --> 00:00:14.320 Hold on, I found the same guy on Amazon and it says compare at 6'2"? 00:00:14.320 --> 00:00:18.640 What does that mean? He's an organic mask. We just want him in the server rack. 00:00:18.640 --> 00:00:20.080 What are you even talking about? No. 00:00:24.640 --> 00:00:28.880 This type of deceptive marketing has existed for as long as I've been 4'1", 00:00:28.960 --> 00:00:31.920 but more recently it's become an even bigger problem. 00:00:32.480 --> 00:00:39.200 For example, just last year, Best Buy.com decided to change how they present promotional prices. 00:00:39.200 --> 00:00:45.200 Instead of calculating discounts compared to their typical everyday price, or, you know, MSRP, 00:00:45.200 --> 00:00:52.720 they now use a compare at reference price that is, from what we can tell, at best optimistic 00:00:52.720 --> 00:00:57.600 and at worst an outright lie. And the worst part is Best Buy seems to know this, 00:00:57.600 --> 00:01:01.280 given that they haven't brought this practice to other regions where they have 00:01:01.280 --> 00:01:08.240 stricter regulations on this behavior. So let's talk about how retailers are trying to avoid pricing transparency, 00:01:08.240 --> 00:01:13.600 how this plague is spreading, and what we can do as consumers to push back against it. 00:01:13.600 --> 00:01:16.640 Starting at this segue to our sponsor. 00:01:25.840 --> 00:01:30.400 This problem runs much deeper than just one retailer, and we're going to get into that later, 00:01:30.400 --> 00:01:33.440 but I want to start with Best Buy's recent changes. 00:01:33.440 --> 00:01:39.920 This monitor, for instance, is listed for $260 off compared to Best Buy's comparable value. 00:01:39.920 --> 00:01:45.680 Compared to what, though? At a glance, this seems to suggest that it is compared to their normal retail price, but 00:01:46.560 --> 00:01:51.920 why don't we dig into the fine print here? Oh, and dig into the fine print here, shall we? 00:01:52.800 --> 00:02:00.000 Our comparable value prices are based on the price at which the product or a comparable item. 00:02:02.400 --> 00:02:06.560 Wait, the reference price can be for another product entirely? 00:02:06.560 --> 00:02:10.000 Who decides what's comparable? Oh, wait, okay, hold on, there's more. 00:02:10.000 --> 00:02:16.080 It can also be a price that was or in the future will be offered for sale by Best Buy, 00:02:16.080 --> 00:02:19.520 Marketplace sellers, manufacturers, suppliers, or other retailers online or in store. 00:02:19.600 --> 00:02:28.720 Let me get this straight. Best Buy's new policy is that it can reference the price of any product at any time, even in the 00:02:28.720 --> 00:02:34.800 future, sold by anyone, anywhere, and use that to calculate how much money I'm saving, 00:02:34.800 --> 00:02:37.840 and they think that that's a useful reference? 00:02:37.840 --> 00:02:47.840 No, of course they don't. Why would they make this change? The simple answer is to capitalize on the FOMO of shoppers who might not obsessively track prices 00:02:47.840 --> 00:02:52.960 and might not realize that the discounts they're being offered are kind of BS. 00:02:52.960 --> 00:02:56.880 If you want me to illustrate why this matters and why it needs to be stopped, 00:02:56.880 --> 00:03:03.760 I've got a perfect example for you. LTTstore.com sometimes discounts our legendary ratcheting multi-bit screwdriver. 00:03:03.760 --> 00:03:06.960 $10 off, though, doesn't sound like that big of a deal. 00:03:06.960 --> 00:03:14.400 But hold on a second. What if I compare at some other multi-bit screwdriver from, say, Vera Tools? 00:03:14.960 --> 00:03:19.600 No, no. Not the price on their site. How about this one from a random seller? 00:03:20.400 --> 00:03:23.600 Now look at the LTT screwdriver. What a deal. 00:03:23.600 --> 00:03:30.800 But wait, there's more. I think that that Red Bull Edition could double in price in the future. 00:03:30.800 --> 00:03:37.280 Well, now you're saving $940 on your purchase from LTTstore.com, 00:03:37.280 --> 00:03:43.840 which sounds ridiculous because it is. But if we don't do something, that's the direction we could be headed. 00:03:43.840 --> 00:03:48.560 And look, I fully recognize that the slippery slope argument may be a fallacy. 00:03:48.560 --> 00:03:53.200 But Best Buy is obviously out there icing the hill right now. 00:03:53.200 --> 00:03:58.640 So isn't any of this against the law? Well, I'm not a lawyer and this isn't legal advice, 00:03:58.640 --> 00:04:01.760 but the short version is it seems like it is. 00:04:01.760 --> 00:04:07.920 And it seems like Best Buy knows it. You might have noticed that I keep using the words reference price. 00:04:07.920 --> 00:04:12.000 And that's because reference pricing is a common phrase used in legal documents 00:04:12.000 --> 00:04:15.920 for what the American FTC calls retail price comparisons. 00:04:15.920 --> 00:04:19.680 And false reference pricing or deceptive pricing 00:04:19.680 --> 00:04:24.640 is a practice that is regulated by the FTC. How do I know that Best Buy knows this? 00:04:24.640 --> 00:04:28.240 Because they've been sued over it as recently as just last year. 00:04:28.880 --> 00:04:33.520 That suit claims that Best Buy enticed shoppers with discounted prices 00:04:33.520 --> 00:04:37.600 that would either not change after the sale period 00:04:37.600 --> 00:04:41.440 were not lower than the regular price 90 days before the sale 00:04:41.440 --> 00:04:46.000 or even were higher than another recently advertised price. 00:04:46.000 --> 00:04:49.280 Now that case was voluntarily dismissed by the plaintiffs. 00:04:49.280 --> 00:04:54.000 But that doesn't mean that Best Buy is in the right. It is possible that they were right, 00:04:54.000 --> 00:04:58.080 but it's also possible that the plaintiffs were dissuaded by the cost of litigation 00:04:58.080 --> 00:05:03.760 or it's possible that Best Buy settled out of court. I don't really consider the matter resolved one way or the other. 00:05:03.760 --> 00:05:07.200 And neither should you. It is worth noting by the way that outside of the U.S. 00:05:07.200 --> 00:05:12.640 Best Buy Canada doesn't use this language. And that appears to be because Canada's Competition Bureau 00:05:12.640 --> 00:05:18.160 requires retailers to pass a certain volume or time test 00:05:18.160 --> 00:05:21.360 in order to count something as an ordinary selling price. 00:05:21.360 --> 00:05:26.640 Although it is worth noting that even then, recent lawsuits have cropped up accusing Best Buy Canada 00:05:26.640 --> 00:05:29.920 of misrepresenting regular prices and savings. 00:05:29.920 --> 00:05:34.480 Now, I've picked on Best Buy a lot so far. But I promise to touch on the others 00:05:34.480 --> 00:05:38.480 and now it's time to do just that because this is a widespread issue. 00:05:39.120 --> 00:05:44.000 Walmart's reference pricing appears to be based on the median price within 90 days 00:05:44.000 --> 00:05:47.920 offered by Walmart or its marketplace sellers. 00:05:47.920 --> 00:05:50.480 That's a little better, but that bit at the end. 00:05:51.200 --> 00:05:59.760 Knowing how marketplace sellers tend to price items, that clearly gives Walmart a lot of leeway for representing their discounts. 00:05:59.760 --> 00:06:05.280 Then of course, there's Amazon. They do use a suggested retail price, 00:06:05.280 --> 00:06:08.320 which can be provided by the manufacturer, supplier, or seller. 00:06:08.400 --> 00:06:14.320 If the reference price is labeled list price, but if it's the typical price, like on Walmart, 00:06:14.320 --> 00:06:17.440 that's just the 90-day median price that customers have paid 00:06:17.440 --> 00:06:22.640 with no real auditing or transparency from our side to actually verify it. 00:06:23.280 --> 00:06:26.640 Now, I could continue to give examples, but I think at this point it would be better to lay out 00:06:26.640 --> 00:06:31.440 what we feel needs to be done, starting with compare at reference prices, 00:06:31.440 --> 00:06:36.800 simply being banned, or required to be the manufacturer's advertised MSRP. 00:06:36.800 --> 00:06:45.440 This move is unlikely to make anything cheaper, see GPUs that regularly retail for well above NVIDIA's supposed MSRPs, 00:06:45.440 --> 00:06:48.880 but at least this would give consumers the transparency to understand 00:06:48.880 --> 00:06:52.560 what is a deal and what just plain is not a deal. 00:06:52.560 --> 00:06:58.480 With that out of the way, compare at, though, is just one of the three horsemen of the deceptive marketing apocalypse. 00:06:58.480 --> 00:07:05.120 Up two can be just as bad, whether it's sales where the deeply discounted items are all garbage, 00:07:05.120 --> 00:07:08.720 or product specifications that would be better represented as 00:07:08.720 --> 00:07:14.320 your mileage may vary. Up two has turned into this catch-all but covering clause 00:07:14.320 --> 00:07:19.040 that just absolves manufacturers and retailers of any responsibility 00:07:19.040 --> 00:07:22.800 for products or offers that don't live up to their promises. 00:07:22.800 --> 00:07:26.080 And the funny thing about it is that guidelines around this one 00:07:26.080 --> 00:07:32.080 totally do exist as well. They just need to be adopted by regulatory bodies and then enforced. 00:07:32.080 --> 00:07:38.480 The Better Business Bureau, for instance, prohibits up two sale claims where at least 10% of the items in the sale 00:07:38.480 --> 00:07:42.800 don't meet the advertised discount threshold. That sounds pretty sensible to me. 00:07:42.800 --> 00:07:48.640 As for the last one, starting at, I'm not going to get into too much detail since we've got a whole video dedicated 00:07:48.640 --> 00:07:52.320 to dunking on companies for advertising an awful configuration 00:07:52.320 --> 00:07:58.560 you shouldn't buy that gets you in the door, then upselling you something usable often for a lot more money. 00:07:58.560 --> 00:08:01.520 So, with the three out there, what can we do about them? 00:08:02.080 --> 00:08:06.400 Well, it's tough because there are cases where these terms do make sense. 00:08:06.400 --> 00:08:10.800 Apple's Mac Mini would be a great example of a product that is an awesome value, 00:08:10.800 --> 00:08:14.320 even at its starting-at configuration. Let's pick on ourselves again. 00:08:14.320 --> 00:08:19.360 Our own true spec USB-C cables are starting at $21.99. 00:08:19.360 --> 00:08:23.680 But like Apple, I'm not going to apologize for that product being a great value, 00:08:23.680 --> 00:08:29.760 especially when the one that's 40 times faster costs just $5 more than that starting-at price. 00:08:29.840 --> 00:08:32.720 And so with everyone setting their own line in the sand, 00:08:33.280 --> 00:08:39.520 I don't know how you would police something like that. So let's come back to compare at because here there's something that we can, 00:08:39.520 --> 00:08:47.920 or at least should be able to do, to fight back. PC Part Picker is an incredibly useful tool because they track pricing across multiple retailers 00:08:47.920 --> 00:08:52.480 over time, which helps shoppers determine what an item is actually worth 00:08:52.480 --> 00:08:56.320 and how a current price compares to a historical pricing. 00:08:56.320 --> 00:09:00.240 But we've noticed a pattern of behavior, especially here in North America, 00:09:00.240 --> 00:09:04.640 where retailers are actively fighting against similar services. 00:09:05.440 --> 00:09:08.800 Similar websites that have tried to do what PC Part Picker did, 00:09:08.800 --> 00:09:12.160 but more broadly, have crumbled under the pressure. 00:09:12.160 --> 00:09:16.880 Like Price Zombie, a tool that tracked price history across multiple online retailers 00:09:16.880 --> 00:09:20.160 and then collected affiliate money from the traffic that their links generated. 00:09:20.160 --> 00:09:23.680 That actually sounds like a business model that would be beneficial for everyone, right? 00:09:23.680 --> 00:09:28.560 Well, Amazon didn't think so, and allegedly they barred Price Zombie from their affiliate program 00:09:28.560 --> 00:09:34.480 for violating its rules that prohibit showing Amazon prices that are more than 24 hours old. 00:09:34.480 --> 00:09:39.680 Given that Amazon affiliate was 90% of Price Zombie's revenue, it was a death blow. 00:09:39.680 --> 00:09:45.680 Then there's Camel Camel Camel, who CEO has said outright that they live or die by Amazon 00:09:45.680 --> 00:09:51.280 and that they also prohibit showing Amazon prices next to pricing from a competitor, 00:09:51.280 --> 00:09:58.400 which is why they decided to only display Amazon data, despite originally also tracking Best Buy and New Egg on separate websites. 00:09:58.400 --> 00:10:06.720 How does Amazon wield so much power here? In the EU, for instance, Idealo is a huge website that somehow manages to display 00:10:06.720 --> 00:10:12.800 and compare prices, even historical prices, across a ton of retailers, including Amazon. 00:10:12.800 --> 00:10:17.520 What are our alternatives? Well, there is one, but I'm not recommending it. 00:10:18.640 --> 00:10:26.320 It's f***ing honey. Those bloodsuckers, with their pay tell money, have somehow managed to build and keep live 00:10:26.320 --> 00:10:31.200 a tool called Drop List that seems to do a pretty decent job of scraping prices 00:10:31.200 --> 00:10:36.640 and tracking price history. It's not as good at showing price history across retailers, all in one place, 00:10:36.640 --> 00:10:42.080 like Idealo is or Price Zombie was, and it seems to glitch out a bit with certain retailers, 00:10:42.640 --> 00:10:49.440 but it is there. It is insane to me that this is the only tool we could find that could do this job 00:10:49.520 --> 00:10:52.240 outside of tech, and it wasn't just us. 00:10:52.800 --> 00:10:58.000 It seems like you just need to have major financial muscle in order to get away with this. 00:10:58.960 --> 00:11:03.040 On that note, the next closest thing has probably got to be Google Shopping, 00:11:03.040 --> 00:11:08.480 but even that doesn't prominently display the best deal, and while its price tracking does exist, 00:11:08.480 --> 00:11:12.800 it also doesn't seem to show you Amazon in any of its results in the US. 00:11:12.800 --> 00:11:17.200 Finally, there's Capital One Shopping, which does a good job of showing multiple retailers 00:11:17.200 --> 00:11:20.800 with the best price up top, but doesn't track price history. 00:11:20.800 --> 00:11:24.000 Now there are a lot of other services that claim to do this job, 00:11:24.000 --> 00:11:27.440 but we usually found that they simply didn't give us the best price. 00:11:27.440 --> 00:11:32.320 With that said, if you know of one we missed, hey, leave a comment below and help to spread the word. 00:11:32.320 --> 00:11:37.280 With all that said, what can you do to stop retailers from using deceptive practices 00:11:37.280 --> 00:11:42.240 like false reference pricing and going after tools that help you make more informed purchasing 00:11:42.240 --> 00:11:46.080 decisions? Unfortunately, the only answer is the one that's going to be work. 00:11:46.160 --> 00:11:51.680 You've got to get involved. Follow websites like ClassAction.org and participate wherever you can. 00:11:51.680 --> 00:11:55.120 You can also advocate for stricter regulations and better enforcement 00:11:55.120 --> 00:12:00.000 by touching base with consumer advocacy groups or by writing your government representative. 00:12:00.000 --> 00:12:05.680 I know that's not a convenient or especially fulfilling solution, but it's what you can do. 00:12:06.400 --> 00:12:11.200 Another thing you can do is steer your hard-earned money toward businesses that don't participate 00:12:11.200 --> 00:12:16.000 in these practices, like for example, LTTstore.com and our sponsor. 00:12:16.000 --> 00:12:19.840 If you guys enjoyed this video, why not check out the one that we did on Starting At? 00:12:19.840 --> 00:12:23.600 It's a little more tech focused, but I think it does a good job of outlining 00:12:23.600 --> 00:12:26.400 why it can be so problematic.