American Apparel is naughty, American Express is nice in latest Consumer Reports list

    Consumer Reports News: November 21, 2011 06:08 AM

    Consumer Reports today unveiled its 2011 Naughty & Nice Holiday List. First introduced in 2010 as part of a public-education campaign, the Naughty & Nice Holiday List looks at the good and not-so-good shopping policies and the companies behind them. This year's List includes high profile companies from a variety of fields including: air travel, electronics, apparel retailing, credit-card lending and concert ticketing.

    The Naughty & Nice Holiday List is based on input from Consumer Reports reporters and editors who cover shopping, travel, hospitality and telecommunications. Consumer Reports notes that the Naughty & Nice Holiday List is based on specific policies and is not reflective of a company as a whole.

    The success of our roundup--timed to coincide with the holiday season, when travel and shopping are at a peak and shoppers at their most vulnerable--has prompted Consumer Reports to make the campaign an annual event. Our 2011 list once again puts some very visible companies in the hot seat for fine print, befuddling fees, and the like. It gives other companies points for good behavior.

    We've checked each policy either by direct contact or reading through the details on the company's website. Although we cite companies by name, other players may engage in similar business practices—for better or worse. And praise or blame for a specific policy doesn't mean we give a thumbs up or down for everything else that company does or the way it treats customers.


    • Bi-Lo supermarkets. Most supermarkets will refund the purchase price of a product that doesn't meet expectations, but this Southern chain offers a double-money-back guarantee on every item it sells whatever the reason for the return.

    • Cablevision. Telecom companies are a frequent target of consumer displeasure, but this industry giant offers more to subscribers who sign up for its Optimum Triple Play - Internet, phone, and TV service - free movie tickets on Tuesdays and deeply discounted tickets on other days. Customers who sign up for Cablevision's Optimum Rewards program (it's free) also get perks like discounted popcorn and soda at participating theaters.

    • Live Nation. The world's largest live-entertainment promoter, ticket distributor, and artist-management firm gives fans three days to cancel their ticket order and get a refund at participating venues (typically until one week before the event). Live Nation also lets customers exchange seats for better ones that become available after a purchase.

    • American Express. The company offers peace of mind at no extra cost. If a cardholder buys a covered item with his or her Amex card and unsuccessfully tries to return it to the merchant within 90 days, American Express can refund the full purchase price, up to $300 ($1,000 per account per year).

    • Orvis. Many e-commerce companies encourage questions by phone or e-mail. But this seller of fishing gear and outdoorsy clothes offers help if a customer lingers on a product long enough, initiating dialog via live chat.

    • Crutchfield. The electronics merchant offers help with installation, setup, troubleshooting 24/7, and tech support at no extra charge for the life of the gear purchased.

    • Costco. The chain has a generous return policy and provides free tech support for many electronics products. Less known is that it automatically extends the manufacturer's original warranty on TVs and computers to two years from the date of purchase.

    • The e-tailing giant has taken a stand against wastefuland hard-to-open product packaging. It encourages customers to share photographs and feedback with manufacturers, who can then modify their package designs and submit them to Amazon's engineers to see if they qualify as frustration-free. If so, the companies can use the "Certified Frustration-Free" logo as a marketing tool. To date, hundreds of products from companies including Philips, Garmin, and Logitech have met the criteria.

    • Microsoft. If someone buys and installs software on his or her computer, most retailers won't give out a refund, no matter how much the customer hates it. Not so with Microsoft. Consumers dissatisfied with a Microsoft software or hardware purchase from any retailer can send it back to the company within 45 days for a refund and reimbursement of shipping costs up to $7.

    • REI. The outdoor/adventure outfitter has one of the most liberal return policies around. It accepts returns or exchanges at any time for any reason, and makes the process simple. Customers can return any item by mail or to any REI store regardless of location, whether they bought online, by mail, or in an REI store. The policy even applies to goods bought from REI's online outlet.


    • AirTran. Imagine that you bought a shirt and were charged extra for the buttons. Ridiculous, right? But this Orlando-based airline's discounted coach and sale-fare flights don't include the price of the seat. If you - like most people -- want to select your seat when you book online, AirTran will charge $6 to $20 each way. Otherwise, you can show up at the gate and take your chances that you don't get stuck with a noisy back-row seat near the lavatory.

    • RadioShack. The company acknowledges that it sometimes charges different prices for the same item. When a reader shopped for an HDMI audio-video cable, the store price was nearly twice the online price. Asked why, a customer-service supervisor said he couldn't do anything about the discrepancy, and directed the reader to the fine print on RadioShack's website.

    • American Apparel. On the plus side, the Los Angeles-based company still makes clothes in the United States. However, it has two different return policies. Online customers have 45 days to return an item for a full refund or credit; store customers have 30 days and receive a merchandise credit.

    • Verizon Wireless. The company tells the Federal Communications Commission that it voluntarily provides ample warning to customers who seem about to exceed their monthly allotment of minutes, messages, or data, so a mandatory rule that would make it issue such alerts isn't necessary. But we caught Verizon doing -- and admitting to -- something else. Two staffers who are Verizon customers recently were notified only after they went over their allotment, at which time the company tried to upsell them to a pricier plan. When contacted by our reporter, a company spokesman acknowledged that its voluntary alert system isn't always reliable. But it now looks like better protection from "bill shock" is on its way. Under a mid-October deal with the FCC, members of CTIA - The Wireless Association, a trade group representing 97 percent of wireless carriers, agreed to begin issuing alerts of impending overages. Full implementation of the alert system could take until April 2013.

    • Liberty Travel. Tour operators often advertise very low prices to suck in customers. But the quotes sometimes exclude high taxes and fees. Take Liberty Travel (billed as "America's vacation experts"). It offers an eye-popping deal such as a three-night Disney vacation package, including airfare, theme park ticket, and some food, starting at $559 per person. But hold on. The 283 words of tiny type at the bottom of the ad say that the price excludes taxes and fees of up to $250, baggage fees, or other fees charged by the airline. And if someone needs to switch a flight? It'll cost as much as $200 extra.

    • The Swiss Colony. Like many businesses, the 85-year-old Wisconsin-based mail-order food firm ties its delivery fees to the dollar amount of an order rather than the size and weight of the package - a practice we've criticized before. Thus, if an order totals $25, shipping and processing is $5.95, but if it costs a penny more, the freight jumps to $7.95 Beyond that, The Swiss Colony asks customers to fork over another $2.99 per shipping address for unspecified reasons. So we called the company for an explanation. The customer service rep told us the surcharge reflects the cost of a mailing label.

    • Southwest Airlines.
    For an extra $10 per flight, travelers can complete online check-in earlier than the usual 24 hours before takeoff, improve their boarding group position, snag a better seat (Southwest doesn't assign seats; it's first-come, first-served), and thus get their pick of available overhead bin space. It sounds benign enough. Yet, it's another reminder that a basic ticket doesn't buy much these days, and how price-conscious customers can get penalized if they don't go for the upgrade.

    • SiriusXM satellite radio. If a subscriber wants to receive a bill in the mail and pay by check (the old-fashioned way), he or she will get socked with a $2 surcharge every month. The penalty can be avoided if the customer gives Sirius credit-card information and elects to be billed electronically on a recurring basis.

    • GameStop. A Fortune 500 company with more than 6,500 stores worldwide, this video game software and hardware merchant has a laundry list of conditions governing returns and exchanges. And in the end, GameStop proclaims, "We reserve the right to refuse any return."

    Tod Marks

    E-mail Newsletters

    FREE e-mail Newsletters! Choose from cars, safety, health, and more!
    Already signed-up?
    Manage your newsletters here too.

    Money News


    Cars Build & Buy Car Buying Service
    Save thousands off MSRP with upfront dealer pricing information and a transparent car buying experience.

    See your savings


    Mobile Get Ratings on the go and compare
    while you shop

    Learn more