The rise of consumer power (and the birth of Pricewatch)
‘The consumer agency was hobbled from the start and it was not given the teeth or the cash to really fight on behalf of the consumers
The earliest mention of “consumers” in The Irish Times came on the day the paper was first published in March 1859 but as it debuted in an advertisement for Patrick Byrne’s “white soaps and sperm candles” in which he promised “liberal discounts to large consumers” it was hardly the most auspicious of beginnings.
Since then the C word has appeared just under 140,000 times on these pages but in recent times it has been a whole lot more likely to be linked to rights, protection, empowerment and disgruntlement than candles made from whale blubber.
The notion that consumers might need protection or even have a voice is pretty recent and we had to wait until the mid-1960s – when the Consumer Association of Ireland was founded – for that voice to grow loud enough to be heard.
In the early 1970s disparate groups, frequently led by redoubtable country women, sought out Gay Byrne and a few sympathetic ears in the print media to highlight the high cost of food and dairy products in the new-fangled supermarkets that were opening their doors, but such matters were largely ignored by those who controlled the levers of power.
In 1975 the EEC drew up the first programme for consumer protection. The rights of the consumer were outlined for the first time: the right to choose, to be informed, to safety, to be heard and to be represented. They haven’t changed much since then, although the consumer’s voice is louder than ever, and most companies claim to have the consumer’s best interests at heart.
The customer is always wronged
It still seems, however, that lip-service is more common than good service, and the customer who is supposed to be always right is far too frequently wronged. In the early part of the last decade – as we were getting used to all the lovely boominess – it seemed to dawn on consumers that all was not right in their world of amply stocked supermarket shelves, high-end motor cars, designer handbags and low-fare jet-set lifestyles. With the illusory wealth of the Celtic Tiger came rip-offs. Lots of rip-offs.
The internet explosion of the early part of the last decade gave us new and better ways to spend our money, but also offered us new ways to identify the most egregious rips-offs. Consultations with the web oracles of Google and Amazon made it clear that retailers big and small, mobile phone companies, banks and even our doctors and dentists were bleeding us dry.
The Fianna Fáil government set up a committee to help consumers get a better deal.
After much deliberation this committee published a strategy report which was long on promises and short on results. The Groceries Order was abolished, although prices did not fall as much as we were promised they would.
That committee was also behind the setting up of the National Consumer Agency (NCA). Its chief executive was Ann Fitzgerald who had chaired the consumer strategy group. Not long after taking office she criticised the State for its failure to consult with, inform or advocate on behalf of the consumer, and she described the power of vested interests in preventing consumers getting a fair deal as “frightening”. The NCA worked out that the cost to the economy of passive consumers and bad services was €840 million a year. The agency was hobbled from the start and it was not given the teeth or the cash to really fight on behalf of consumers.
And consumers needed help. Inertia extends to almost all service providers and retailers as, time and time again, people have shown themselves reluctant to take themselves and their cash elsewhere to punish businesses which let them down or charged them too much.
Things have improved on that score and, according to a recent study into consumer behaviour by Accenture, Irish people complain more than ever and care more about the quality of care they are offered.
What’s a tracker mortgage?
Remember the guy on the bus who did not know what a tracker mortgage was? Not many of us did. Then we all did, as banks started giving these cut-price mortgages out with unseemly haste. The country paid for it in the end, and the banks’ reckless lending practices have cost us €64 billion or €16,000 for every man, woman and child living in the Republic today.
Banks have frequently abused consumer trust. They mis-sold payment protection insurance (PPI) to potentially hundreds of thousands and penalised those who missed the tracker boat, with a barrage of standard variable rate hikes.
Few were spared the new charges the banks rolled out while cutting services. It is hard for individuals – or media organisations – to take on the banks. Even the Government can’t bring them to heel.
United Breaks Guitars
There is an old truism which says that people treated well by a business tell one or two others while those who are treated shabbily tell 20. It has never looked so out of date. Social networking has seen a major power shift in recent years. With the help of Facebook, Twitter, YouTube and countless bulletin boards and discussion forums, people with access to a computer can complain to a potential audience of millions if a company displeases them.
The results are sometimes hilarious. A few years ago an obscure musician called Dave Carroll was given the runaround by United Airlines for nine months after one of its baggage handlers smashed his €3,000 guitar. Fed up, he wrote a song documenting his negative experiences. The song, United Breaks Guitars, was posted on YouTube in July 2009. All told nearly 14 million people have now watched the clip, and despite multiple apologies from United, the only thing most of the 14 million know about the airline is that it breaks guitars.
Birth of Pricewatch
Pricewatch has been around since early 2003 and has dealt with thousands of customer complaints. The roll of dishonour has been long with cable television companies, airlines, phone and broadband providers and a handful of supermarkets and utilities jostling for position at the top of the list of companies that have displeased readers.
The first complaint came from a reader who warned about the dangers of trusting a mobile- phone operator when roaming. This reader said an unnamed network provider was not entirely upfront about where the best value roaming charges were to be found in a particular country and instead pointed her to a dearer company to which it was linked.
“So don’t just accept the first foreign network recommended by your operator: ask about other options and get a breakdown of all tariffs”, was the best advice we could come up with. We’re a lot more likely to name and shame the company today.