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Which companies will be naughty or nice this holiday season?

Consumer Reports News: November 22, 2010 06:08 AM

As the holidays loom, who’s been naughty and who’s been nice?

Imagine if all companies behaved as if they really had customers’ best interests at heart? Wouldn’t it be something if advertisements were always sincere, minus the double-speak, fine print, and lip service?

Surely, no company would brag about squeezing every last nickel out of the American consumer by larding on questionable fees and hefty shipping costs, shortening return periods, and imposing obscene penalties for canceling contracts for everyday services.

Now that the holidays are here, we thought this would be the perfect time for our first ever naughty and nice list, a collection of customer-service policies we like or loathe because they strike us as particularly consumer friendly or not so friendly.

Consider it a pat on the back or a kick in the pants. We feel so strongly about the issue that we’re making the list the centerpiece of a holiday educational campaign, following in the footsteps of previous campaigns alerting shoppers to the tricks and traps of extended warranties, gift cards, and credit-card debt.

A couple of points for the record. The list is not derived from any exhaustive Consumer Reports study or survey. Rather, it’s based on input from our in-house reporters and editors, who cover shopping, travel, hospitality, telecommunications, and other franchise areas. While we’ve identified specific companies by name, we acknowledge that there are, of course, other large companies we haven’t singled out that have similar policies. And just because we mention a particular policy doesn’t mean we endorse—or dislike—everything else about that company or the way it does business.

That said, here’s our list, in no particular order.  What policies do you think should be added to the list—for better or worse?

Nice:

1 Southwest. Two pieces of checked luggage, no charge. And that includes bulky freight such as golf clubs and skis.

2 L.L.Bean. 100 percent product satisfaction guarantee. Return anything at any time for any reason.

3 Zappos.com. Free shipping and free returns, including prepaid return label.

4 Costco. Open-ended return policy for virtually everything the warehouse retailer sells minus some home electronics, which come with a still-generous 90-day return period.

5 U.S. Cellular. While the FCC is proposing that cell carriers alert consumers who are about to exceed their plans’ monthly minutes allotment, which could lead to significant overage charges, this company is already practicing due diligence and giving its customers a heads up.

6 Orvis. For customer service the old-fashioned way, shoppers can call a toll-free number and speak to a human being without wading through an arcane automated menu system. Alternatively, Orvis offers live-chat with support staff, e-mail queries, and a guaranteed response time of two hours or less.

7 Hotels.com. The travel website never charges a fee to cancel or change a room booking. But it’s still imperative to check the hotel’s specific reservation policy to avoid any penalty imposed by the chain.

8 J&R. The electronics superstore and e-retailer has a straightforward price-match policy without the many caveats and fine-print exclusions of some other merchants: Find it at a lower price at an authorized seller (the exception being a warehouse membership club) and “we will do everything possible to meet or beat that price” via a special telephone hotline. J&R also gives customers 30 days to ask for a price adjustment on existing orders if they unearth a lower price.

9 Walmart. No receipt, no problem. Customers can return most items to a Walmart store for a cash refund (for purchases under $25), a gift card (for purchases over $25), or even exchange. There’s one catch: More than three such returns within 45 days requires a manager’s approval.

10 Publix. It’s no fun being sick, but if you need an antibiotic, the Florida-based supermarket chain will have its pharmacies dispense up to a 14-day supply for some of the most common generic ones free. All you need is a proper prescription.

Naughty:

1 Buy.com. No returns for “oversize” TV sets, defined as any model 27 inches or larger. If you fail to inspect set upon delivery and sign shipper’s release, Buy.com says it’s your problem and go deal with the manufacturer. Its website also lacks a phone number for customer contact.

2 CompUSA. For imposing unusually punitive restocking fees of “up to 25 percent” of the purchase price on any product the retailer decides doesn’t meet its return criteria. Nowhere is it spelled out which specific products are subject to such a fee.

3 Best Buy. Offers a 14-day grace period to return computers, monitors, camcorders, and digital cameras.

4 Spirit Airlines. The carrier, which pioneered “ancillary” fees among domestic airlines, charges for carry-on bags: $30 in advance, $45 at the gate.

5 Verizon Wireless. Doubled to $350 the Early Termination Fee imposed on consumers who cancel their smart-phone contract after the 30-day grace period. Mercifully, Verizon kept the penalty at $175 for consumers with conventional cell phones.

6 Dollar car rental. It’s bad enough that companies force you to pay for gas you never use if you choose not to refuel the vehicle yourself. But Dollar is even more penny pinching by demanding customers present a receipt to prove that they filled up the tank within 10 miles of the drop-off location or face a fee to top off the tank and the labor required to do so.

7 SanDisk. If mail-in rebates weren’t enough of a headache, SanDisk, which frequently dangles promotional offers for its memory cards, is a big fan of mail-in rebates which are issued in the form of a gift card. What’s wrong with an instant rebate at the register, a practice that the rival company Lexar began based on customer feedback?

8 Macy’s. Proving that high shipping fees are not necessarily a thing of the past, the department store chain calculates its freight charges on the dollar amount of the order, not the size and weight of the package. The base fee is $5.95 for orders under $25, to as much as $23.95 for those $300 or more. And that’s standard delivery.

9 United Airlines. No one wants to overpay on airfare, but you never really know whether you’re getting a rock-bottom price. As peace of mind, United offers customers a low-price guarantee. Find a lower fare on the company’s website for the same itinerary you already booked and not only will United give you the lower fare, but also a voucher good for 20 percent off your next purchase. But hold on. If you have a nonrefundable ticket—the type most people buy—and find a cheaper flight, United imposes a $150 “administrative” fee to make the change.

10 DirecTV. The California-based satellite TV firm, which has more than 18.7 million subscribers, has a policy that automatically extends a customer’s contract for another 24 months if any new equipment is added. If that policy rubs you the wrong way and you want to cancel your service, the penalty is an early termination fee.

-- Tod Marks

   

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