Thursday, October 20, 2011

Have I Got A Deal For You

Like many new cars, my Hyundai Tuscon came with a 90-day XM trial. So I gave it a shot and generally liked it - it was miles better than the pathetic set of Austin radio stations, and did pull songs from time-to-time that weren't already on my 80 GB iPod. However, I didn't like it enough to want to pay the full $160 or so per year fee (as my friends will tell you, I'm pretty much a cheapskate).

Soon after the trial ran out, I got a call from a telemarketer for XM, who offered me a five month subscription period for $20. Well, four dollars a month is pretty different from $14, so I decided to accept that deal. They warned me that I would have to call to renew at that rate once the five months was up, and sure enough, I missed the notification. So I was automatically renewed at a rate of about $85 for six months.

OK, that was my fault, so I sucked it up, but once that six month period was about to end, I called up XM and requested a renewal at the original promotional rate, which they readily accepted. So I am back on for another five months at $20 total.

So in summary, we have here about four different subscription rates for the same service - free (for the initial trial), $4/month (for the discount renewal), $13/month (for the normal retail price), and about $15/month (the rate they renewed me at for some reason).

I find that I have a hard time trusting companies or industries that live on this kind of pricing structure - that you have to "know" how to get the good deal. You have to know the magic code, or know how to work the customer service lines, or know to get this special package, or whatever, to avoid paying double or triple the price. Other industries where this happens are airlines and hotels, for example. I don't know why some companies feel they have to hide the ball - provide a good product or service that I like, tell me what it costs, and I will make a decision. Don't make me wonder if I somehow missed the magic incantation that the guy next to me found. Don't make me wonder why you can sell me this service for $5/month when last month you charged me $15 for the same thing.

It shouldn't have to be like this. For example, compare Apple to other computer or cell phone manufacturers. Apple has a relatively small number of models, with a relatively simple number of options (usually installed disk space, memory or screen sizes). They don't have 40 varieties of touch screen models, each with slightly different sets of features. And they don't have lots of special deals - in fact, Apple clamps down pretty severely on their retailers to make sure they sell at the same price. They provide a good product and don't make it hard to purchase. Do their customers squeeze out every last penny that could by running the salesman gauntlets? No - but on the whole they are more satisfied as customers than most other companies.

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